II 

Calendar No. 706 

108TH CONGRESS 

2D SESSION S. 2486 

[Report No. 108–352] 

To amend title 38, United States Code, to improve and enhance education, 

housing, employment, medical, and other benefits for veterans and to 

improve and extend certain authorities relating to the administration 

or benefits for veterans, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

JUNE 1, 2004 

Mr. SPECTER (for himself, Ms. MURKOWSKI, and Mrs. MURRAY) (by request) 

introduced the following bill; which was read twice and referred to the 

Committee on Veterans’ Affairs 

SEPTEMBER 20, 2004 

Reported by Mr. SPECTER, with an amendment and an amendment to the title 

[Strike out all after the enacting clause and insert the part printed in italic] 

A BILL 

To amend title 38, United States Code, to improve and 

enhance education, housing, employment, medical, and 

other benefits for veterans and to improve and extend 

certain authorities relating to the administration or benefits for veterans, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 
2 

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1 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

2 (a) SHORT TITLE.—This Act may be cited as the 

3 ‘‘Veterans’ Benefits Improvements Act of 2004’’. 

4 (b) TABLE OF CONTENTS.—The table of contents for 

5 this Act is as follows: 

Sec. 1. Short title; table of contents. 

Sec. 2. References to title 38, United States Code. 

TITLE I—EDUCATION BENEFITS 

Sec. 101. Increase in maximum amount of contribution for increased amount 

of basic educational assistance under Montgomery GI Bill. 

Sec. 102. Pilot program on additional two-year period for use of entitlement by 

participants in Montgomery GI Bill for vocational or job readiness training. 

Sec. 103. Exclusion of veterans education benefits in determination of eligibility 

or amount of Federal educational grants and loans. 

Sec. 104. Collection of contributions for educational assistance under Montgomery GI Bill from Reserves called to active duty. 

TITLE II—HOUSING BENEFITS 

Sec. 201. Increase in maximum amount of housing loan guarantee. 

Sec. 202. Permanent authority for guarantee of adjustable rate mortgages. 

Sec. 203. Permanent authority for guarantee of hybrid adjustable rate mortgages and modification of guarantee authority. 

Sec. 204. Termination of collection of loan fees from veterans rated eligible for 

compensation at pre-discharge rating examinations. 

TITLE III—OTHER BENEFITS AND BENEFITS MATTERS 

Subtitle A—Employment Benefits 

Sec. 301. Availability of administrative and judicial redress for certain veterans 

denied opportunity to compete for Federal employment. 

Subtitle B—Medical Benefits 

Sec. 311. Prohibition on collection of copayments for hospice care. 

Subtitle C—Extension of Benefits and Related Authorities 

Sec. 321. Extension of various authorities relating to benefits for veterans. 

Subtitle D—Other Matters 

Sec. 331. Modification of definition of minority group member for purposes of 

Advisory Committee on Minority Veterans. 
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1 SEC. 2. REFERENCES TO TITLE 38, UNITED STATES CODE. 

2 Except as otherwise expressly provided, whenever in 

3 this Act an amendment or repeal is expressed in terms 

4 of an amendment to, or repeal of, a section or other provi5 sion, the reference shall be considered to be made to a 

6 section or other provision of title 38, United States Code. 

7 TITLE I—EDUCATION BENEFITS 

8 SEC. 101. INCREASE IN MAXIMUM AMOUNT OF CONTRIBU9 TION FOR INCREASED AMOUNT OF BASIC 

10 EDUCATIONAL ASSISTANCE UNDER MONT11 GOMERY GI BILL. 

12 (a) ACTIVE DUTY BENEFIT.—Section 3011(e)(3) is 

13 amended by striking ‘‘$600’’ and inserting ‘‘$2,000’’. 

14 (b) SELECTED RESERVE BENEFIT.—Section 

15 3012(f)(3) is amended by striking ‘‘$600’’ and inserting 

16 ‘‘$2,000’’. 

17 SEC. 102. PILOT PROGRAM ON ADDITIONAL TWO-YEAR PE18 RIOD FOR USE OF ENTITLEMENT BY PARTICI19 PANTS IN MONTGOMERY GI BILL FOR VOCA20 TIONAL OR JOB READINESS TRAINING. 

21 (a) IN GENERAL.—(1) Subchapter I of chapter 30 

22 is amended by adding at the end the following new section: 
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1 ‘‘§ 3020A. Additional two-year period for use of enti2 tlement for vocational or job readiness 

3 instruction or training: pilot program 

4 ‘‘(a) PILOT PROGRAM REQUIRED.—(1) The Sec5 retary shall carry out a pilot program to assess the feasi6 bility and advisability of permitting individuals whose enti7 tlement to basic educational assistance under this chapter 

8 expires under section 3031 of this title before their com9 plete use of such entitlement to be entitled to an additional 

10 two-year period for their use of such entitlement. 

11 ‘‘(2) The pilot program shall commence six months 

12 after the date of the enactment of this section, and shall 

13 terminate four years after the date of the commencement 

14 of the pilot program. 

15 ‘‘(b) ADDITIONAL TWO-YEAR PERIOD OF ENTITLE16 MENT.—Notwithstanding any provision of section 3031 of 

17 this title, an individual described in subsection (c) shall, 

18 at the expiration of the 10-year period beginning on the 

19 educational assistance entitlement commencement date of 

20 such individual, be entitled to an additional two-year pe21 riod for the use of entitlement to basic educational assist22 ance under this chapter. 

23 ‘‘(c) ELIGIBLE INDIVIDUALS.—(1) An individual de24 scribed in this subsection is any individual who— 
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1 ‘‘(A) as of the end of the 10-year period begin2 ning on the educational assistance entitlement com3 mencement date of such individual— 

4 ‘‘(i) would remain entitled to basic edu5 cational assistance under this chapter but for 

6 the expiration of the 10-year delimiting period 

7 applicable to such individual under section 3031 

8 of this title; and 

9 ‘‘(ii) has not utilized all of the entitlement 

10 of such individual to basic educational assist11 ance under this chapter; and 

12 ‘‘(B) at the time of the application for entitle13 ment under this subsection (d), is accepted, enrolled, 

14 or otherwise participating (as determined by the 

15 Secretary) in instruction or training described in 

16 subsection (e). 

17 ‘‘(2) This subsection does not apply to an individual 

18 otherwise described by paragraph (1) whose remaining en19 titlement to basic educational assistance under this chap20 ter as described in subparagraph (A)(ii) of that paragraph 

21 is based on the transfer of basic educational assistance 

22 under section 3020 of this title. 

23 ‘‘(d) APPLICATION.—(1) An individual seeking an ad24 ditional two-year period for the use of entitlement under 

25 this section shall submit to the Secretary an application 
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1 therefor containing such information as the Secretary may 

2 require for purposes of this section. 

3 ‘‘(2) The Secretary may not receive applications 

4 under this subsection after the termination date of the 

5 pilot program under subsection (a)(2). 

6 ‘‘(e) COMMENCEMENT OF ADDITIONAL PERIOD FOR

7 USE.—The additional two-year period for the use of enti8 tlement by an individual under this section shall com9 mence on the date the application of the individual under 

10 subsection (d) is received by the Secretary if the Secretary 

11 determines pursuant to a review of the application that 

12 the individual is an individual described by subsection (c) 

13 for purposes of this section. 

14 ‘‘(f) INSTRUCTION OR TRAINING COVERED BY ADDI15 TIONAL PERIOD FOR USE.—(1) The instruction or train16 ing for which entitlement to basic educational assistance 

17 under this chapter may be used during the additional two18 year period for the use of entitlement under this section 

19 is as follows: 

20 ‘‘(A) Education leading to employment in a 

21 high technology industry for purposes of section 

22 3014A of this title. 

23 ‘‘(B) A full-time program of apprenticeship or 

24 other on-job training approved as provided in clause 
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1 (1) or (2), as appropriate, of section 3687 of this 

2 title. 

3 ‘‘(C) A cooperative program (as defined in sec4 tion 3482(a)(2) of this title). 

5 ‘‘(D) A licensing or certification test approved 

6 under section 3689 of this title. 

7 ‘‘(E) Training or education leading toward a 

8 professional or vocational objective which has been 

9 approved in accordance with the provisions of sub10 chapter I of chapter 36 of this title and is identified 

11 by the Secretary in regulations to be prescribed by 

12 the Secretary for purposes of this section. 

13 ‘‘(2) Entitlement to basic educational assistance 

14 under this chapter may not be used during the additional 

15 two-year period for the use of entitlement under this sec16 tion for the instruction or training as follows: 

17 ‘‘(A) General education leading toward a stand18 ard college degree (as defined in section 3452(g) of 

19 this title), unless the program or training concerned 

20 will result in an associates degree that is approved 

21 by the Secretary in the manner specified in para22 graph (1)(E) to be necessary to obtain a professional 

23 or vocational objective. 
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1 ‘‘(B) Preparatory courses for a test that is re2 quired or used for admission to an institution of 

3 higher education or graduate school. 

4 ‘‘(g) COORDINATION WITH CERTAIN OTHER BENE5 FITS.—(1) An individual entitled to basic educational as6 sistance under subsection (c) is entitled to educational and 

7 vocational counseling under section 3697A of this title in 

8 connection with the use of entitlement under this section. 

9 ‘‘(2) An individual using entitlement to basic edu10 cational assistance under this chapter during the addi11 tional two-year period for the use of entitlement under this 

12 section is not entitled during the use of such entitlement 

13 to the following: 

14 ‘‘(A) Supplemental educational assistance under 

15 subchapter III of this chapter. 

16 ‘‘(B) A work-study allowance under section 

17 3485 of this title. 

18 ‘‘(h) EDUCATIONAL ASSISTANCE ENTITLEMENT

19 COMMENCEMENT DATE DEFINED.—In this section, the 

20 term ‘educational assistance entitlement commencement 

21 date’, in the case of an individual described in subsection 

22 (b)(1), means the date on which begins the period during 

23 which the individual may use the individual’s entitlement 

24 to educational assistance under chapter as determined 

25 under section 3031 of this title. 
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1 ‘‘(i) EFFECT OF TERMINATION OF PILOT PRO2 GRAM.—The termination of the pilot program under sub3 section (a)(2) shall not effect the continuing use of entitle4 ment under this section of any individual whose additional 

5 two-year period for the use of entitlement under this sec6 tion continues after the date of the termination of the pilot 

7 program under that subsection.’’. 

8 (2) The table of sections at the beginning of such 

9 chapter is amended by inserting after the item relating 

10 to section 3020 the following new item: 

‘‘3020A. Additional two-year period for use of entitlement for vocational or job 

readiness instruction or training: pilot program.’’. 

11 (b) CROSS-REFERENCE AMENDMENT.—Section 3031 

12 is amended— 

13 (1) in subsection (a), by striking ‘‘subsections 

14 (b) through (g), and subject to subsection (h),’’ and 

15 inserting ‘‘subsections (b) through (h), and subject 

16 to subsection (i),’’; 

17 (2) by redesignating subsection (h) as sub18 section (i); and 

19 (3) by inserting after subsection (g) the fol20 lowing new subsection (h): 

21 ‘‘(h) An individual whose period for the use of entitle22 ment to basic educational assistance under this chapter 

23 would otherwise expire under this section may be eligible 
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1 for an additional two-year period for the use of entitlement 

2 under section 3020A of this title.’’. 

3 SEC. 103. EXCLUSION OF VETERANS EDUCATION BENEFITS 

4 IN DETERMINATION OF ELIGIBILITY OR 

5 AMOUNT OF FEDERAL EDUCATIONAL 

6 GRANTS AND LOANS. 

7 (a) IN GENERAL.—(1) Subchapter II of chapter 36 

8 is amended by inserting after section 3694 the following 

9 new section: 

10 ‘‘§ 3694A. Exclusion of veterans education benefits in 

11 determination of eligibility or amount of 

12 Federal education grants and loans 

13 ‘‘(a) EXCLUSION.—Notwithstanding any other provi14 sion of law and subject to subsection (b), education bene15 fits shall not be considered as income, assets, or other 

16 monetary resource in determining eligibility for, or the 

17 amount of, grant or loan assistance provided under title 

18 IV of the Higher Education Act of 1965 (20 U.S.C. 1070 

19 et seq.). 

20 ‘‘(b) EXCEPTION.—In the case of campus-based stu21 dent financial assistance, the amount of such assistance 

22 for which an individual would otherwise be eligible without 

23 taking into consideration education benefits as described 

24 in subsection (a) shall be reduced to the extent that the 

25 sum of such amount, the amount of the education benefits 
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1 of the individual, and the amount of the Federal Pell 

2 Grant, if any, of the individual exceeds the cost of attend3 ance of the individual. 

4 ‘‘(c) DEFINITIONS.—In this section: 

5 ‘‘(1) The term ‘campus-based student financial 

6 assistance’ means grant, work, or loan assistance 

7 provided under subpart 3 of part A, and parts C and 

8 E of title IV of the Higher Education Act of 1965 

9 (20 U.S.C. 1070b et seq; 42 U.S.C. 2751 et seq.; 20 

10 U.S.C. 1087aa et seq.). 

11 ‘‘(2) The term ‘cost of attendance’ has the 

12 meaning given such term in section 472 of the High13 er Education Act of 1965 (20 U.S.C. 1087ll). 

14 ‘‘(3) The term ‘education benefits’ means edu15 cation benefits under chapters 30, 32, and 35 of this 

16 title and under chapter 1606 of title 10. 

17 ‘‘(4) The term ‘Federal Pell Grant’ means a 

18 grant provided under subpart 1 of part A of title IV 

19 of the Higher Education Act of 1965 (20 U.S.C. 

20 1070a).’’. 

21 (2) The table of sections at the beginning of chapter 

22 36 is amended by inserting after the item referring to sec23 tion 3694 the following new item: 

‘‘3694A. Exclusion of veterans education benefits in determination of eligibility 

or amount of Federal education grants and loans.’’. 
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1 (b) EFFECTIVE DATE.—The amendments made by 

2 this section shall be effective with respect to award years, 

3 as that term is defined in section 481(a)(1) of the Higher 

4 Education Act of 1965 (20 U.S.C. 1088(a)(1)), beginning 

5 on or after July 1, 2004. 

6 SEC. 104. COLLECTION OF CONTRIBUTIONS FOR EDU7 CATIONAL ASSISTANCE UNDER MONT8 GOMERY GI BILL FROM RESERVES CALLED 

9 TO ACTIVE DUTY. 

10 (a) ACTIVE DUTY PROGRAM.—Section 3011(b) is 

11 amended— 

12 (1) by striking ‘‘The basic pay’’ and inserting 

13 ‘‘(1) Except as provided in paragraph (2), the basic 

14 pay’’; 

15 (2) by designating the second sentence as para16 graph (3), indenting the left margin of such para17 graph, as so designated, two ems, and, in that para18 graph by striking ‘‘this chapter’’ and inserting ‘‘this 

19 subsection’’; and 

20 (3) by inserting after paragraph (1), as so des21 ignated, the following new paragraph: 

22 ‘‘(2) In the case of an individual covered by para23 graph (1) who is a Reserve, the Secretary shall collect 

24 from the individual an amount equal to $1,200 before the 

25 commencement by the individual of the use of entitlement 
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1 to basic educational assistance under this chapter. The 

2 Secretary may collect such amount through reductions in 

3 basic pay in accordance with paragraph (1) or through 

4 such other method as the Secretary determines appro5 priate.’’. 

6 (b) SELECTED RESERVE PROGRAM.—Section 

7 3012(c) is amended— 

8 (1) by striking ‘‘The basic pay’’ and inserting 

9 ‘‘(1) Except as provided in paragraph (2), the basic 

10 pay’’; 

11 (2) by designating the second sentence as para12 graph (3), indenting the left margin of such para13 graph, as so designated, two ems, and, in that para14 graph by striking ‘‘this chapter’’ and inserting ‘‘this 

15 subsection’’; and 

16 (3) by inserting after paragraph (1), as so des17 ignated, the following new paragraph: 

18 ‘‘(2) In the case of an individual covered by para19 graph (1) who is a Reserve, the Secretary shall collect 

20 from the individual an amount equal to $1,200 before the 

21 commencement by the individual of the use of entitlement 

22 to basic educational assistance under this chapter. The 

23 Secretary may collect such amount through reductions in 

24 basic pay in accordance with paragraph (1) or through 
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1 such other method as the Secretary determines appro2 priate.’’. 

3 TITLE II—HOUSING BENEFITS 

4 SEC. 201. INCREASE IN MAXIMUM AMOUNT OF HOUSING 

5 LOAN GUARANTEE. 

6 (a) IN GENERAL.—Subparagraph (A)(i)(IV) of sec7 tion 3703(a)(1) is amended by striking ‘‘$60,000’’ and in8 serting ‘‘$83,425’’. 

9 (b) CONFORMING AMENDMENT.—Subparagraph (B) 

10 of such section is amended by striking ‘‘$60,000’’ and in11 serting ‘‘$83,425’’. 

12 SEC. 202. PERMANENT AUTHORITY FOR GUARANTEE OF 

13 ADJUSTABLE RATE MORTGAGES. 

14 Section 3707(a) is amended by striking ‘‘The Sec15 retary shall’’ and all that follows through ‘‘guaranteeing 

16 loans’’ and inserting ‘‘The Secretary shall guarantee 

17 loans’’. 

18 SEC. 203. PERMANENT AUTHORITY FOR GUARANTEE OF 

19 HYBRID ADJUSTABLE RATE MORTGAGES AND 

20 MODIFICATION OF GUARANTEE AUTHORITY. 

21 (a) PERMANENT AUTHORITY.—Subsection (a) of sec22 tion 3707A is amended by striking ‘‘The Secretary shall’’ 

23 and all that follows through ‘‘guaranteeing loans’’ and in24 serting ‘‘The Secretary shall guarantee loans’’. 
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1 (b) MODIFICATION OF INTEREST RATE ADJUSTMENT

2 REQUIREMENTS.—Subsection (c) of such section is 

3 amended— 

4 (1) by striking paragraph (3) and inserting the 

5 following new paragraph (3): 

6 ‘‘(3) in the case of the initial interest rate ad7 justment under such provisions, be limited to a max8 imum increase or decrease of 1 percentage point if 

9 the interest rate remained fixed for 3 or fewer years; 

10 and’’; and 

11 (2) in paragraph (4), by striking ‘‘5 percentage 

12 points’’ and all that follows and inserting ‘‘such 

13 number of percentage points as the Secretary shall 

14 prescribe for purposes of this section.’’. 

15 (c) NO EFFECT ON GUARANTEE OF LOANS UNDER

16 HYBRID ADJUSTABLE RATE MORTGAGE GUARANTEE

17 DEMONSTRATION PROJECT.—The amendments made by 

18 this section shall not be construed to affect the force or 

19 validity of any guarantee of a loan made by the Secretary 

20 of Veterans Affairs under the demonstration project for 

21 the guarantee of hybrid adjustable rate mortgages under 

22 section 3707A of title 38, United States Code, as in effect 

23 on the day before the date of the enactment of this Act. 
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1 SEC. 204. TERMINATION OF COLLECTION OF LOAN FEES 

2 FROM VETERANS RATED ELIGIBLE FOR COM3 PENSATION AT PRE-DISCHARGE RATING EX4 AMINATIONS. 

5 Section 3729(c) is amended— 

6 (1) by inserting ‘‘(1)’’ before ‘‘A fee’’; and 

7 (2) by adding at the end the following new 

8 paragraph: 

9 ‘‘(2) A veteran who is rated eligible to receive com10 pensation as a result of a pre-discharge disability examina11 tion and rating shall be treated as receiving compensation 

12 for purposes of this subsection as of the date on which 

13 the veteran is rated eligible to receive compensation as a 

14 result of the pre-discharge disability examination and rat15 ing without regard to whether an effective date of the 

16 award of compensation is established as of that date.’’. 

17 TITLE III—OTHER BENEFITS 

18 AND BENEFITS MATTERS 

19 Subtitle A—Employment Benefits 

20 SEC. 301. AVAILABILITY OF ADMINISTRATIVE AND JUDI21 CIAL REDRESS FOR CERTAIN VETERANS DE22 NIED OPPORTUNITY TO COMPETE FOR FED23 ERAL EMPLOYMENT. 

24 (a) ADMINISTRATIVE REDRESS.—Section 

25 3330a(a)(1) of title 5, United States Code, is amended— 

26 (1) by inserting ‘‘(A)’’ after ‘‘(1)’’; and 
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1 (2) by adding at the end the following new sub2 paragraph: 

3 ‘‘(B) A veteran described in section 3304(f)(1) who 

4 alleges that an agency has violated such section with re5 spect to such veteran may file a complaint with the Sec6 retary of Labor.’’. 

7 (b) JUDICIAL REDRESS.—Section 3330b(a)(1) of 

8 such title is amended by inserting ‘‘, or a veteran described 

9 by section 3330a(a)(1)(B) with respect to a violation de10 scribed by such section,’’ after ‘‘a preference eligible’’. 

11 Subtitle B—Medical Benefits 

12 SEC. 311. PROHIBITION ON COLLECTION OF COPAYMENTS 

13 FOR HOSPICE CARE. 

14 Section 1710B(c)(2) is amended— 

15 (1) in subparagraph (A), by striking ‘‘or’’ at 

16 the end; 

17 (2) by redesignating subparagraph (B) as sub18 paragraph (C); and 

19 (3) by inserting after subparagraph (A) the fol20 lowing new subparagraph (B): 

21 ‘‘(B) to a veteran being furnished hospice care 

22 under this section; or’’. 
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1 Subtitle C—Extension of Benefits 

2 and Related Authorities 

3 SEC. 321. EXTENSION OF VARIOUS AUTHORITIES RELATING 

4 TO BENEFITS FOR VETERANS. 

5 (a) SIX-YEAR EXTENSION OF BIENNIAL REPORT OF

6 ADVISORY COMMITTEE ON FORMER PRISONERS OF

7 WAR.—Section 541(c)(1) is amended by striking ‘‘2003’’ 

8 and inserting ‘‘2009’’. 

9 (b) PERMANENT AUTHORITY FOR COUNSELING AND

10 TREATMENT FOR SEXUAL TRAUMA.—Section 1720D(a) is 

11 amended— 

12 (1) in paragraph (1), by striking ‘‘During the 

13 period through December 31, 2004, the Secretary’’ 

14 and inserting ‘‘The Secretary’’; and 

15 (2) in paragraph (2), by striking ‘‘, during the 

16 period through December 31, 2004,’’. 

17 (c) FIVE-YEAR EXTENSION OF REPORTS BY SPECIAL

18 MEDICAL ADVISORY GROUP.—Section 7312(d) is amend19 ed by striking ‘‘December 31, 2004’’ and inserting ‘‘De20 cember 31, 2009’’. 
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1 Subtitle D—Other Matters 

2 SEC. 331. MODIFICATION OF DEFINITION OF MINORITY 

3 GROUP MEMBER FOR PURPOSES OF ADVI4 SORY COMMITTEE ON MINORITY VETERANS. 

5 Subsection (d) of section 544 is amended to read as 

6 follows: 

7 ‘‘(d) In this section, the term ‘minority group mem8 ber’ means an individual who is— 

9 ‘‘(1) American Indian or Alaska Native; 

10 ‘‘(2) Asian; 

11 ‘‘(3) Black or African American; 

12 ‘‘(4) Native Hawaiian or other Pacific Islander; 

13 or 

14 ‘‘(5) of Hispanic, Latino, or Spanish origin.’’. 

15 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

16 (a) SHORT TITLE.—This Act may be cited as the ‘‘Vet17 erans’ Benefits Improvements Act of 2004’’. 

18 (b) TABLE OF CONTENTS.—The table of contents for 

19 this Act is as follows: 

Sec. 1. Short title; table of contents. 

Sec. 2. References to title 38, United States Code. 

TITLE I—HOUSING MATTERS 

Sec. 101. Increase in maximum amount of home loan guaranty for construction 

and purchase of homes and annual indexing of amount. 

Sec. 102. Extension of authority for guarantee of adjustable rate mortgages. 

Sec. 103. Extension and improvement of authority for guarantee of hybrid adjustable rate mortgages. 

Sec. 104. Termination of collection of loan fees from veterans rated eligible for 

compensation at pre-discharge rating examinations. 
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TITLE II—EDUCATION MATTERS 

Sec. 201. Collection of contributions for educational assistance under Montgomery 

GI Bill from members of the Selected Reserve called to active 

duty. 

Sec. 202. Educational assistance under Montgomery GI Bill for members of the 

Selected Reserve who aggregate 2 or more years of active duty 

service during any 5-year period. 

Sec. 203. Ten-year extension of delimiting period for survivors’ and dependents’ 

educational assistance for spouses of members who die on active 

duty. 

Sec. 204. Availability of education benefits for payment for national admissions 

exams and national exams for credit at institutions of higher 

education. 

TITLE III—OTHER MATTERS 

Sec. 301. Availability of administrative and judicial redress for certain veterans 

denied opportunity to compete for Federal employment. 

Sec. 302. Extension of biennial report of Advisory Committee on Former Prisoners of War. 

Sec. 303. Modification of definition of minority group member for purposes of 

Advisory Committee on Minority Veterans. 

1 SEC. 2. REFERENCES TO TITLE 38, UNITED STATES CODE. 

2 Except as otherwise expressly provided, whenever in 

3 this Act an amendment or repeal is expressed in terms of 

4 an amendment to, or repeal of, a section or other provision, 

5 the reference shall be considered to be made to a section or 

6 other provision of title 38, United States Code. 

7 TITLE I—HOUSING MATTERS 

8 SEC. 101. INCREASE IN MAXIMUM AMOUNT OF HOME LOAN 

9 GUARANTY FOR CONSTRUCTION AND PUR10 CHASE OF HOMES AND ANNUAL INDEXING OF 

11 AMOUNT. 

12 (a) MAXIMUM LOAN GUARANTY BASED ON 100 PER13 CENT OF FREDDIE MAC CONFORMING LOAN RATE.—Sec14 tion 3703(a)(1) is amended by striking ‘‘$60,000’’ each 

15 place it appears in subparagraphs (A)(i)(IV) and (B) and 
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1 inserting ‘‘the maximum guaranty amount (as defined in 

2 subparagraph (C))’’. 

3 (b) DEFINITION.—Such section is further amended by 

4 adding at the end the following new subparagraph: 

5 ‘‘(C) In this paragraph, the term ‘maximum guaranty 

6 amount’ means the dollar amount that is equal to 25 per7 cent of the Freddie Mac conforming loan limit limitation 

8 determined under section 305(a)(2) of the Federal Home 

9 Loan Mortgage Corporation Act (12 U.S.C. 1454(a)(2)) for 

10 a single-family residence, as adjusted for the year in11 volved.’’. 

12 SEC. 102. EXTENSION OF AUTHORITY FOR GUARANTEE OF 

13 ADJUSTABLE RATE MORTGAGES. 

14 Section 3707(a) is amended by striking ‘‘during fiscal 

15 years 1993, 1994, and 1995’’ and inserting ‘‘during fiscal 

16 years 1993 through 2011’’. 

17 SEC. 103. EXTENSION AND IMPROVEMENT OF AUTHORITY 

18 FOR GUARANTEE OF HYBRID ADJUSTABLE 

19 RATE MORTGAGES. 

20 (a) EXTENSION OF AUTHORITY.—Subsection (a) of sec21 tion 3707A is amended by striking ‘‘during fiscal years 

22 2004 and 2005’’ and inserting ‘‘during fiscal years 2004 

23 through 2011’’. 
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1 (b) MODIFICATION OF INTEREST RATE ADJUSTMENT

2 REQUIREMENTS.—Subsection (c) of such section is amend3 ed— 

4 (1) by redesignating paragraph (4) as para5 graph (5); 

6 (2) by striking paragraph (3) and inserting the 

7 following new paragraphs: 

8 ‘‘(3) in the case of the initial interest rate ad9 justment— 

10 ‘‘(A) if the initial interest rate remained 

11 fixed for less than 5 years, be limited to a max12 imum increase or decrease of 1 percentage point; 

13 or 

14 ‘‘(B) if the initial interest rate remained 

15 fixed for 5 years or more, be limited to a max16 imum increase or decrease of such percentage 

17 point or points as the Secretary may prescribe; 

18 ‘‘(4) in the case of any single annual interest 

19 rate adjustment after the initial interest rate adjust20 ment, be limited to a maximum increase or decrease 

21 of 1 percentage point; and’’; and 

22 (3) in paragraph (5), as so redesignated, by 

23 striking ‘‘5 percentage points’’ and all that follows 

24 and inserting ‘‘such number of percentage points as 
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1 the Secretary shall prescribe for purposes of this sec2 tion.’’. 

3 (c) NO EFFECT ON GUARANTEE OF LOANS UNDER HY4 BRID ADJUSTABLE RATE MORTGAGE GUARANTEE DEM5 ONSTRATION PROJECT.—The amendments made by this sec6 tion shall not be construed to affect the force or validity 

7 of any guarantee of a loan made by the Secretary of Vet8 erans Affairs under the demonstration project for the guar9 antee of hybrid adjustable rate mortgages under section 

10 3707A of title 38, United States Code, as in effect on the 

11 day before the date of the enactment of this Act. 

12 SEC. 104. TERMINATION OF COLLECTION OF LOAN FEES 

13 FROM VETERANS RATED ELIGIBLE FOR COM14 PENSATION AT PRE-DISCHARGE RATING EX15 AMINATIONS. 

16 Section 3729(c) is amended— 

17 (1) by inserting ‘‘(1)’’ before ‘‘A fee’’; and 

18 (2) by adding at the end the following new para19 graph: 

20 ‘‘(2) A veteran who is rated eligible to receive com21 pensation as a result of a pre-discharge disability examina22 tion and rating shall be treated as receiving compensation 

23 for purposes of this subsection as of the date on which the 

24 veteran is rated eligible to receive compensation as a result 

25 of the pre-discharge disability examination and rating 
24 

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1 without regard to whether an effective date of the award 

2 of compensation is established as of that date.’’. 

3 TITLE II—EDUCATION MATTERS 

4 SEC. 201. COLLECTION OF CONTRIBUTIONS FOR EDU5 CATIONAL ASSISTANCE UNDER MONT6 GOMERY GI BILL FROM MEMBERS OF THE SE7 LECTED RESERVE CALLED TO ACTIVE DUTY. 

8 (a) ACTIVE DUTY PROGRAM.—Section 3011(b) is 

9 amended— 

10 (1) by striking ‘‘The basic pay’’ and inserting 

11 ‘‘(1) Except as provided in paragraph (2), the basic 

12 pay’’; 

13 (2) by designating the second sentence as para14 graph (3), indenting the left margin of such para15 graph, as so designated, two ems, and, in that para16 graph by striking ‘‘this chapter’’ and inserting ‘‘this 

17 subsection’’; and 

18 (3) by inserting after paragraph (1), as so des19 ignated, the following new paragraph: 

20 ‘‘(2) In the case of an individual covered by paragraph 

21 (1) who is a Reserve, the Secretary of Defense shall collect 

22 from the individual an amount equal to $1,200 before the 

23 commencement by the individual of the use of entitlement 

24 to basic educational assistance under this chapter. The Sec25 retary of Defense may collect such amount through reduc-
25 

•S 2486 RS 

1 tions in basic pay in accordance with paragraph (1) or 

2 through such other method as the Secretary of Defense con3 siders appropriate.’’. 

4 (b) SELECTED RESERVE PROGRAM.—Section 3012(c) 

5 is amended— 

6 (1) by striking ‘‘The basic pay’’ and inserting 

7 ‘‘(1) Except as provided in paragraph (2), the basic 

8 pay’’; 

9 (2) by designating the second sentence as para10 graph (3), indenting the left margin of such para11 graph, as so designated, two ems, and, in that para12 graph by striking ‘‘this chapter’’ and inserting ‘‘this 

13 subsection’’; and 

14 (3) by inserting after paragraph (1), as so des15 ignated, the following new paragraph: 

16 ‘‘(2) In the case of an individual covered by paragraph 

17 (1) who is a Reserve, the Secretary of Defense shall collect 

18 from the individual an amount equal to $1,200 before the 

19 commencement by the individual of the use of entitlement 

20 to basic educational assistance under this chapter. The Sec21 retary of Defense may collect such amount through reduc22 tions in basic pay in accordance with paragraph (1) or 

23 through such other method as the Secretary of Defense con24 siders appropriate.’’. 
26 

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1 SEC. 202. EDUCATIONAL ASSISTANCE UNDER MONT2 GOMERY GI BILL FOR MEMBERS OF THE SE3 LECTED RESERVE WHO AGGREGATE 2 OR 

4 MORE YEARS OF ACTIVE DUTY SERVICE DUR5 ING ANY 5-YEAR PERIOD. 

6 (a) ENTITLEMENT.—Section 3012(a)(1) is amended— 

7 (1) in subparagraph (B), by striking ‘‘or’’ at the 

8 end; 

9 (2) in subparagraph (C), by adding ‘‘or’’ at the 

10 end; and 

11 (3) by inserting after subparagraph (C) the fol12 lowing new subparagraph (D): 

13 ‘‘(D) during any five-year period beginning 

14 on or after September 11, 2001, and ending on 

15 or before June 30, 2008, while in the Selected 

16 Reserve, serves on active duty in the Armed 

17 Forces for one or more periods (whether contin18 uous or otherwise) aggregating not less than two 

19 years of service on active duty during such pe20 riod;’’. 

21 (b) COLLECTION OF CONTRIBUTIONS.—Section 

22 3012(c), as amended by section 201(b) of this Act, is further 

23 amended by adding at the end the following new paragraph: 

24 ‘‘(4)(A) In the case of an individual who becomes enti25 tled to basic educational assistance under this chapter by 

26 reason of subsection (a)(1)(D), the Secretary of Defense 
27 

•S 2486 RS 

1 shall collect from the individual an amount equal to $1,200 

2 not later than one year after the completion by the indi3 vidual of the two years of service on active duty providing 

4 the basis for such entitlement. 

5 ‘‘(B) An individual described in subparagraph (A) 

6 shall not be entitled to basic educational assistance as de7 scribed in that subparagraph unless an amount equal to 

8 $1,200 is first collected from the individual as required 

9 under that subparagraph. 

10 ‘‘(C) The Secretary of Defense may collect amounts 

11 under subparagraph (A) through reductions in basic pay 

12 in accordance with paragraph (1) or through such other 

13 method as the Secretary of Defense considers appropriate.’’. 

14 (c) DURATION OF ASSISTANCE.—Section 3013(b) is 

15 amended by striking ‘‘is entitled to’’ and all that follows 

16 and inserting the following: ‘‘is entitled to— 

17 ‘‘(1) one month of educational assistance benefits 

18 under this chapter— 

19 ‘‘(A) in the case of an individual described 

20 in section 3012(a)(1)(A) of this title, for each 

21 month of continuous active duty served by such 

22 individual after June 30, 1985, as part of the 

23 obligated period of active duty on which such en24 titlement is based; 
28 

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1 ‘‘(B) in the case of an individual described 

2 in section 3012(a)(1)(B) of this title, for each 

3 month of continuous active duty served by such 

4 individual after June 30, 1985; or 

5 ‘‘(C) in the case of an individual described 

6 in section 3012(a)(1)(D) of this title, for each 

7 month of active duty served by such individual 

8 after September 11, 2001, and before July 1, 

9 2008, as part of the aggregate period of active 

10 duty on which such entitlement is based; and 

11 ‘‘(2) one month of educational assistance benefits 

12 under this chapter for each four months served by 

13 such individual in the Selected Reserve after the ap14 plicable date specified in paragraph (1) of this sub15 section (other than any month in which the indi16 vidual served on active duty).’’. 

17 (d) AMOUNT OF ASSISTANCE.—Section 3015 is amend18 ed— 

19 (1) in subsections (a)(1)(D) and (b)(1)(D), by 

20 striking ‘‘subsection (h)’’ and inserting ‘‘subsection 

21 (i)’’; 

22 (2) by redesignating subsection (h) as subsection 

23 (i); and 

24 (3) by inserting after subsection (g) the following 

25 new subsection (h): 
29 

•S 2486 RS 

1 ‘‘(h) In the case of an individual entitled to an edu2 cational assistance allowance under section 3012(a)(1)(D) 

3 of this title, the amount of the basic educational assistance 

4 allowance payable under this chapter is the amount deter5 mined under subsection (b) of this section.’’. 

6 (e) OUTREACH.—(1) The Secretary concerned shall 

7 take actions to inform members of the Selected Reserve who 

8 are or may become entitled to basic educational assistance 

9 benefits under chapter 30 of title 38, United States Code, 

10 as a result of section 3012(a)(1)(D) of such title (as amend11 ed by subsection (a) of this section) of the minimum service 

12 requirements for entitlement to such benefits under that 

13 chapter and of the scope and nature of such benefits. 

14 (2) In this subsection: 

15 (A) The term ‘‘Secretary concerned’’ has the 

16 meaning given such term in section 101(25) of title 

17 38, United States Code. 

18 (B) The term ‘‘Selected Reserve’’ has the mean19 ing given such term in section 3002(4) of title 38, 

20 United States Code. 

21 SEC. 203. TEN-YEAR EXTENSION OF DELIMITING PERIOD 

22 FOR SURVIVORS’ AND DEPENDENTS’ EDU23 CATIONAL ASSISTANCE FOR SPOUSES OF 

24 MEMBERS WHO DIE ON ACTIVE DUTY. 

25 Section 3512(b)(1) is amended— 
30 

•S 2486 RS 

1 (1) in subparagraph (A), by striking ‘‘in sub2 paragraph (B)’’ and inserting ‘‘in subparagraph (B) 

3 or (C)’’; and 

4 (2) by adding at the end the following new sub5 paragraph: 

6 ‘‘(C) Notwithstanding subparagraph (A), an eligible 

7 person referred to in that subparagraph who is made eligi8 ble under section 3501(a)(1)(B) of this title by reason of 

9 the death of a person on active duty may be afforded edu10 cational assistance under this chapter during the 20-year 

11 period beginning on the date (as determined by the Sec12 retary) such person becomes an eligible person within the 

13 meaning of such section.’’. 

14 SEC. 204. AVAILABILITY OF EDUCATION BENEFITS FOR PAY15 MENT FOR NATIONAL ADMISSIONS EXAMS 

16 AND NATIONAL EXAMS FOR CREDIT AT INSTI17 TUTIONS OF HIGHER EDUCATION. 

18 (a) COVERED EXAMS.—Sections 3452(b) and 

19 3501(a)(5) are each amended by adding at the end the fol20 lowing new sentence: ‘‘Such term also includes national 

21 tests for admission to institutions of higher learning or 

22 graduate schools (such as the SAT, LSAT, GRE, and 

23 GMAT exams) and national tests providing an opportunity 

24 for course credit at institutions of higher learning (such as 

25 the AP exam).’’. 
31 

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1 (b) AMOUNT OF PAYMENT.— 

2 (1) CHAPTER 30.—Section 3032 is amended by 

3 adding at the end the following new subsection: 

4 ‘‘(g)(1) Subject to paragraph (3), the amount of edu5 cational assistance payable under this chapter for a na6 tional test for admission or national test providing an op7 portunity for course credit at institutions of higher learning 

8 described in section 3452(b) of this title is the amount of 

9 the fee charged for the test. 

10 ‘‘(2) The number of months of entitlement charged in 

11 the case of any individual for a test described in paragraph 

12 (1) is equal to the number (including any fraction) deter13 mined by dividing the total amount of educational assist14 ance paid such individual for such test by the full-time 

15 monthly institutional rate of educational assistance, except 

16 for paragraph (1), such individual would otherwise be paid 

17 under subsection (a)(1), (b)(1), (d), or (e)(1) of section 3015 

18 of this title, as the case may be. 

19 ‘‘(3) In no event shall payment of educational assist20 ance under this subsection for a test described in paragraph 

21 (1) exceed the amount of the individual’s available entitle22 ment under this chapter.’’. 

23 (2) CHAPTER 32.—Section 3232 is amended by 

24 adding at the end the following new subsection: 
32 

•S 2486 RS 

1 ‘‘(d)(1) Subject to paragraph (3), the amount of edu2 cational assistance payable under this chapter for a na3 tional test for admission or national test providing an op4 portunity for course credit at institutions of higher learning 

5 described in section 3452(b) of this title is the amount of 

6 the fee charged for the test. 

7 ‘‘(2) The number of months of entitlement charged in 

8 the case of any individual for a test described in paragraph 

9 (1) is equal to the number (including any fraction) deter10 mined by dividing the total amount of educational assist11 ance paid such individual for such test by the full-time 

12 monthly institutional rate of educational assistance, except 

13 for paragraph (1), such individual would otherwise be paid 

14 under this chapter. 

15 ‘‘(3) In no event shall payment of educational assist16 ance under this subsection for a test described in paragraph 

17 (1) exceed the amount of the individual’s available entitle18 ment under this chapter.’’. 

19 (3) CHAPTER 34.—Section 3482 is amended by 

20 adding at the end the following new subsection: 

21 ‘‘(i)(1) Subject to paragraph (3), the amount of edu22 cational assistance payable under this chapter for a na23 tional test for admission or national test providing an op24 portunity for course credit at institutions of higher learning 
33 

•S 2486 RS 

1 described in section 3452(b) of this title is the amount of 

2 the fee charged for the test. 

3 ‘‘(2) The number of months of entitlement charged in 

4 the case of any individual for a test described in paragraph 

5 (1) is equal to the number (including any fraction) deter6 mined by dividing the total amount of educational assist7 ance paid such individual for such test by the full-time 

8 monthly institutional rate of educational assistance, except 

9 for paragraph (1), such individual would otherwise be paid 

10 under this chapter. 

11 ‘‘(3) In no event shall payment of educational assist12 ance under this subsection for a test described in paragraph 

13 (1) exceed the amount of the individual’s available entitle14 ment under this chapter.’’. 

15 (4) CHAPTER 35.—Section 3532 is amended by 

16 adding at the end the following new subsection: 

17 ‘‘(g)(1) Subject to paragraph (3), the amount of edu18 cational assistance payable under this chapter for a na19 tional test for admission or national test providing an op20 portunity for course credit at institutions of higher learning 

21 described in section 3501(a)(5) of this title is the amount 

22 of the fee charged for the test. 

23 ‘‘(2) The number of months of entitlement charged in 

24 the case of any individual for a test described in paragraph 

25 (1) is equal to the number (including any fraction) deter-
34 

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1 mined by dividing the total amount of educational assist2 ance paid such individual for such test by the full-time 

3 monthly institutional rate of educational assistance, except 

4 for paragraph (1), such individual would otherwise be paid 

5 under this chapter. 

6 ‘‘(3) In no event shall payment of educational assist7 ance under this subsection for a test described in paragraph 

8 (1) exceed the amount of the individual’s available entitle9 ment under this chapter.’’. 

10 TITLE III—OTHER MATTERS 

11 SEC. 301. AVAILABILITY OF ADMINISTRATIVE AND JUDICIAL 

12 REDRESS FOR CERTAIN VETERANS DENIED 

13 OPPORTUNITY TO COMPETE FOR FEDERAL 

14 EMPLOYMENT. 

15 (a) ADMINISTRATIVE REDRESS.—Section 3330a(a)(1) 

16 of title 5, United States Code, is amended— 

17 (1) by inserting ‘‘(A)’’ after ‘‘(1)’’; and 

18 (2) by adding at the end the following new sub19 paragraph: 

20 ‘‘(B) A veteran described in section 3304(f)(1) who al21 leges that an agency has violated such section with respect 

22 to such veteran may file a complaint with the Secretary 

23 of Labor.’’. 

24 (b) JUDICIAL REDRESS.—Section 3330b(a) of such 

25 title is amended by inserting ‘‘, or a veteran described by 
35 

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1 section 3330a(a)(1)(B) with respect to a violation described 

2 by such section,’’ after ‘‘a preference eligible’’. 

3 SEC. 302. EXTENSION OF BIENNIAL REPORT OF ADVISORY 

4 COMMITTEE ON FORMER PRISONERS OF WAR. 

5 Section 541(c)(1) is amended by striking ‘‘2003’’ and 

6 inserting ‘‘2009’’. 

7 SEC. 303. MODIFICATION OF DEFINITION OF MINORITY 

8 GROUP MEMBER FOR PURPOSES OF ADVI9 SORY COMMITTEE ON MINORITY VETERANS. 

10 Subsection (d) of section 544 is amended to read as 

11 follows: 

12 ‘‘(d) In this section, the term ‘minority group member’ 

13 means an individual who is— 

14 ‘‘(1) American Indian or Alaska Native; 

15 ‘‘(2) Asian; 

16 ‘‘(3) Black or African American; 

17 ‘‘(4) Native Hawaiian or other Pacific Islander; 

18 or 

19 ‘‘(5) of Hispanic, Latino, or Spanish origin.’’. 

Amend the title so as to read: ‘‘A bill to amend title 

38, United States Code, to improve and extend housing, 

education, and other benefits under the laws administered by the Secretary of Veterans Affairs, and for other 

purposes.’’. 
Calendar No. 706 

108TH CONGRESS 

2D SESSION S. 2486 

[Report No. 108–352] 

A BILL 

To amend title 38, United States Code, to improve 

for other purposes. the administration or benefits for veterans, and improve and extend certain authorities relating to medical, and other benefits for veterans and to and enhance education, housing, employment, 

SEPTEMBER 20, 2004 

Reported with an amendment and an amendment to the 

title 

Calendar No. 706 

108TH CONGRESS 

2D SESSION S. 2486 

[Report No. 108–352] 

A BILL 

To amend title 38, United States Code, to improve 

for other purposes. the administration or benefits for veterans, and improve and extend certain authorities relating to medical, and other benefits for veterans and to and enhance education, housing, employment, 

SEPTEMBER 20, 2004 

Reported with an amendment and an amendment to the 

title