108TH CONGRESS

2D SESSION H. R. 4658

AN ACT

To amend the Servicemembers Civil Relief Act to make certain improvements and technical corrections to that Act,

otherwise to improve legal protections provided to reserve

component members called to active duty, and for other

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

3 SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

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

5 ‘‘Servicemembers and Veterans Legal Protections Act of

6 2004’’.

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

8 this Act is as follows:

Sec. 1. Short title; table of contents.

TITLE I—IMPROVEMENTS TO SERVICEMEMBERS CIVIL RELIEF

ACT

Sec. 101. Clarification of meaning of ‘‘judgment’’ as used in the Act.

Sec. 102. Requirements relating to waiver of rights under the Act.

Sec. 103. Right of servicemember plaintiffs to request stay of civil proceedings.

Sec. 104. Termination of leases.

Sec. 105. Prevention of double taxation of certain servicemembers.

TITLE II—EMPLOYMENT AND REEMPLOYMENT RIGHTS

Subtitle A—Extension of Health Care Coverage

Sec. 201. Two-year period of continuation of employer-sponsored health care

coverage.

Sec. 202. Reinstatement of reporting requirements.

Subtitle B—Other Matters

Sec. 211. Requirement for employers to provide notice of rights and duties

under USERRA.

Sec. 212. Demonstration project for referral of USERRA claims against Federal agencies to the Office of Special Counsel.

TITLE III—MATTERS RELATING TO FIDUCIARIES

Sec. 301. Definition of fiduciary.

Sec. 302. Inquiry, investigations, and qualification of fiduciaries.

Sec. 303. Misuse of benefits by fiduciaries.

Sec. 304. Additional protections for beneficiaries with fiduciaries.

Sec. 305. Annual report.

Sec. 306. Annual adjustment in benefits thresholds.

Sec. 307. Effective dates.

TITLE IV—OTHER MATTERS
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Sec. 401. Inventory of medical waste management activities at Department

health-care facilities.

Sec. 402. Technical amendments to education program provisions.

1 TITLE I—IMPROVEMENTS TO

2 SERVICEMEMBERS CIVIL RE3 LIEF ACT

4 SEC. 101. CLARIFICATION OF MEANING OF ‘‘JUDGMENT’’ AS

5 USED IN THE ACT.

6 Section 101 of the Servicemembers Civil Relief Act

7 (50 U.S.C. App. 511) is amended by adding at the end

8 the following new paragraph:

9 ‘‘(9) JUDGMENT.—The term ‘judgment’ means

10 any judgment, decree, order, or ruling, final or tem11 porary.’’.

12 SEC. 102. REQUIREMENTS RELATING TO WAIVER OF

13 RIGHTS UNDER THE ACT.

14 Section 107 of the Servicemembers Civil Relief Act

15 (50 U.S.C. App. 517) is amended—

16 (1) In subsection (a), by inserting after the first

17 sentence the following new sentence: ‘‘Any such

18 waiver that applies to an action listed in subsection

19 (b) of this section is effective only if it is in writing

20 and is executed as an instrument separate from the

21 obligation or liability to which it applies.’’;

22 (2) by redesignating subsection (c) as sub23 section (d); and
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1 (3) by inserting after subsection (b) the fol2 lowing new subsection (c):

3 ‘‘(c) PROMINENT DISPLAY OF CERTAIN CONTRACT

4 RIGHTS WAIVERS.—Any waiver in writing of a right or

5 protection provided by this Act that applies to a contract,

6 lease, or similar legal instrument must be in at least 12

7 point type.’’.

8 SEC. 103. RIGHT OF SERVICEMEMBER PLAINTIFFS TO RE9 QUEST STAY OF CIVIL PROCEEDINGS.

10 Section 202(a) of the Servicemembers Civil Relief Act

11 (50 U.S.C. App. 522(a)) is amended by inserting ‘‘plain12 tiff or’’ before ‘‘defendant’’.

13 SEC. 104. TERMINATION OF LEASES.

14 (a) JOINT LEASES.—Subsection (a) of section 305 of

15 the Servicemembers Civil Relief Act (50 U.S.C. App. 535)

16 is amended to read as follows:

17 ‘‘(a) TERMINATION BY LESSEE.—

18 ‘‘(1) IN GENERAL.—The lessee on a lease de19 scribed in subsection (b) may, at the lessee’s option,

20 terminate the lease at any time after—

21 ‘‘(A) the lessee’s entry into military serv22 ice; or

23 ‘‘(B) the date of the lessee’s military or24 ders described in paragraph (1)(B) or (2)(B) of

25 subsection (b), as the case may be.
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1 ‘‘(2) JOINT LEASES.—A lessee’s termination of

2 a lease pursuant to this subsection shall terminate

3 any obligation a dependent of the lessee may have

4 under the lease.’’.

5 (b) MOTOR VEHICLES LEASES.—

6 (1) APPLICABILITY TO PCS ORDERS FROM

7 STATES OUTSIDE CONUS.—Subparagraph (B) of

8 subsection (b)(2) of such section is amended by

9 striking ‘‘military orders for’’ and all that follows

10 through ‘‘or to deploy’’ and inserting ‘‘military

11 orders—

12 ‘‘(i) for a change of permanent

13 station—

14 ‘‘(I) from a location in the conti15 nental United States to a location out16 side the continental United States; or

17 ‘‘(II) from a location in a State

18 outside the continental United States

19 to any location outside that State; or

20 ‘‘(ii) to deploy’’.

21 (2) DEFINITIONS.—Such section is further

22 amended by adding at the end the following new

23 subsection:

24 ‘‘(i) DEFINITIONS.—
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1 ‘‘(1) MILITARY ORDERS.—The term ‘military

2 orders’, with respect to a servicemember, means offi3 cial military orders, or any notification, certification,

4 or verification from the servicemember’s com5 manding officer, with respect to the servicemember’s

6 current or future military duty status.

7 ‘‘(2) CONUS.—The term ‘continental United

8 States’ means the 48 contiguous States and the Dis9 trict of Columbia.’’.

10 (c) COVERAGE OF INDIVIDUAL DEPLOYMENTS.—

11 Subsection (b) of such section is further amended in para12 graph (1)(B) and paragraph (2)(B)(ii) (as designated by

13 subsection (b) of this section) by inserting ‘‘, or as an indi14 vidual in support of a military operation,’’ after ‘‘deploy

15 with a military unit’’.

16 SEC. 105. PREVENTION OF DOUBLE TAXATION OF CERTAIN

17 SERVICEMEMBERS.

18 Section 511(c) of the Servicemembers Civil Relief Act

19 (50 U.S.C. App. 571(c)) is amended by adding at the end

20 the following new paragraph:

21 ‘‘(5) USE, EXCISE, OR SIMILAR TAXES.—A tax

22 jurisdiction may not impose a use, excise, or similar

23 tax on the personal property of a nonresident

24 servicemember when the laws of the tax jurisdiction

25 fail to provide a credit against such taxes for sales,
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1 use, excise, or similar taxes previously paid on the

2 same property to another tax jurisdiction.’’.

3 TITLE II—EMPLOYMENT AND

4 REEMPLOYMENT RIGHTS

5 Subtitle A—Extension of Health

6 Care Coverage

7 SEC. 201. TWO-YEAR PERIOD OF CONTINUATION OF EM8 PLOYER-SPONSORED HEALTH CARE COV9 ERAGE.

10 (a) IMPROVEMENT IN PERIOD OF COVERAGE.—Sub11 section (a)(1)(A) of section 4317 of title 38, United States

12 Code, is amended by striking ‘‘18-month period’’ and in13 serting ‘‘24-month period’’.

14 (b) EFFECTIVE DATE.—The amendment made by

15 subsection (a) shall apply to elections made under such

16 section 4317 on or after the date of the enactment of this

17 Act.

18 SEC. 202. REINSTATEMENT OF REPORTING REQUIRE19 MENTS.

20 Section 4332 of title 38, United States Code, is

21 amended in the matter preceding paragraph (1) by strik22 ing ‘‘no later than February 1, 1996, and annually there23 after through 2000’’ and inserting ‘‘no later than Feb24 ruary 1, 2005, and annually thereafter’’.
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1 Subtitle B—Other Matters

2 SEC. 211. REQUIREMENT FOR EMPLOYERS TO PROVIDE NO3 TICE OF RIGHTS AND DUTIES UNDER

4 USERRA.

5 (a) NOTICE.—Chapter 43 of title 38, United States

6 Code, is amended by adding at the end the following new

7 section:

8 ‘‘§ 4334. Notice of rights and duties

9 ‘‘(a) REQUIREMENT TO PROVIDE NOTICE.—Each

10 employer shall provide to persons entitled to rights and

11 benefits under this chapter a notice of the rights, benefits,

12 and obligations of such persons and such employers under

13 this chapter. The requirement for the provision of notice

14 under this section may be met by the posting of the notice

15 where employers customarily place notices for employees.

16 ‘‘(b) CONTENT OF NOTICE.—The Secretary shall

17 provide to employers the text of the notice to be provided

18 under this section.’’.

19 (b) CLERICAL AMENDMENT.—The table of sections

20 at the beginning of such chapter is amended by adding

21 at the end the following new item:

‘‘4334. Notice of rights and duties.’’.

22 (c) IMPLEMENTATION.—(1) Not later than the date

23 that is 90 days after the date of the enactment of this

24 Act, the Secretary of Labor shall make available to em-
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1 ployers the notice required under section 4334 of title 38,

2 United States Code, as added by subsection (a).

3 (2) The amendments made by this section shall apply

4 to employers under chapter 43 of such title on and after

5 the first date referred to in paragraph (1).

6 SEC. 212. DEMONSTRATION PROJECT FOR REFERRAL OF

7 USERRA CLAIMS AGAINST FEDERAL AGEN8 CIES TO THE OFFICE OF SPECIAL COUNSEL.

9 (a) ESTABLISHMENT OF PROJECT.—The Secretary

10 of Labor and the Office of Special Counsel shall carry out

11 a demonstration project under which certain claims

12 against Federal executive agencies under the Uniformed

13 Services Employment and Reemployment Rights Act

14 under chapter 43 of title 38, United States Code, are re15 ferred to, or otherwise received by, the Office of Special

16 Counsel for assistance, including investigation and resolu17 tion of the claim as well as enforcement of rights with

18 respect to the claim.

19 (b) REFERRAL OF ALL PROHIBITED PERSONNEL AC20 TION CLAIMS TO THE OFFICE OF SPECIAL COUNSEL.—

21 (1) Under the demonstration project, the Office of Special

22 Counsel shall receive and investigate all claims under the

23 Uniformed Services Employment and Reemployment

24 Rights Act with respect to Federal executive agencies in

25 cases where the Office of Special Counsel has jurisdiction
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1 over related claims pursuant to section 1212 of title 5,

2 United States Code.

3 (2) For purposes of paragraph (1), a related claim

4 is a claim involving the same Federal executive agency and

5 the same or similar factual allegations or legal issues as

6 those being pursued under a claim under the Uniformed

7 Services Employment and Reemployment Rights Act.

8 (c) REFERRAL OF OTHER CLAIMS AGAINST FED9 ERAL EXECUTIVE AGENCIES.—(1) Under the demonstra10 tion project, the Secretary—

11 (A) shall refer to the Office of Special Counsel

12 all claims described in paragraph (2) made during

13 the period of the demonstration project; and

14 (B) may refer any claim described in paragraph

15 (2) filed before the demonstration project that is

16 pending before the Secretary at the beginning of the

17 demonstration project.

18 (2) A claim referred to in paragraph (1) is a claim

19 under chapter 43 of title 38, United States Code, against

20 a Federal executive agency by a claimant with a social se21 curity account number with an odd number as its terminal

22 digit, or, in the case of a claim that does not contain a

23 social security account number, a case number assigned

24 to the claim with an odd number as its terminal digit.
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1 (d) ADMINISTRATION OF DEMONSTRATION

2 PROJECT.—(1) The Office of Special Counsel shall admin3 ister the demonstration project. The Secretary shall co4 operate with the Office of Special Counsel in carrying out

5 the demonstration project.

6 (2) In the case of any claim referred, or otherwise

7 received by, to the Office of Special Counsel under the

8 demonstration project, any reference to the ‘‘Secretary’’

9 in sections 4321, 4322, and 4326 of title 38, United

10 States Code, is deemed a reference to the ‘‘Office of Spe11 cial Counsel’’.

12 (3) In the case of any claim referred to, or otherwise

13 received by, the Office of Special Counsel under the dem14 onstration project, the Office of Special Counsel shall re15 tain administrative jurisdiction over the claim.

16 (e) PERIOD OF PROJECT.—The demonstration

17 project shall be carried out during the period beginning

18 on the date that is 60 days after the date of the enactment

19 of this Act, and ending on September 30, 2007.

20 (f) EVALUATIONS AND REPORT.—(1) The Comp21 troller General of the United States shall conduct periodic

22 evaluations of the demonstration project under this sec23 tion.

24 (2) Not later than April 1, 2007, the Comptroller

25 General shall submit to Congress a report on the evalua-
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1 tions conducted under paragraph (1). The report shall in2 clude the following information and recommendations:

3 (A) A description of the operation and results

4 of the demonstration program, including—

5 (i) the number of claims described in sub6 section (c) referred to, or otherwise received by,

7 the Office of Special Counsel and the number of

8 such claims referred to the Secretary of Labor,

9 and

10 (ii) for each Federal executive agency, the

11 number of claims resolved, the type of correc12 tive action obtained, the period of time for final

13 resolution of the claim, and the results ob14 tained.

15 (B) An assessment of whether referral to the

16 Office of Special Counsel of claims under the dem17 onstration project—

18 (i) improved services to servicemembers

19 and veterans; or

20 (ii) significantly reduced or eliminated du21 plication of effort and unintended delays in re22 solving meritorious claims of those

23 servicemembers and veterans.

24 (C) An assessment of the feasibility and advis25 ability of referring all claims under chapter 43 of
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1 title 38, United States Code, against Federal execu2 tive agencies to the Office of Special Counsel for in3 vestigation and resolution.

4 (D) Such other recommendations for adminis5 trative action or legislation as the Comptroller Gen6 eral determines appropriate.

7 (g) DEFINITIONS.—In this section:

8 (1) The term ‘‘Office of Special Counsel’’

9 means the Office of Special Counsel established by

10 section 1211 of title 5, United States Code.

11 (2) The term ‘‘Secretary’’ means the Secretary

12 of Labor.

13 (3) The term ‘‘Federal executive agency’’ has

14 the meaning given that term in section 4303(5) of

15 title 38, United States Code.

16 TITLE III—MATTERS RELATING

17 TO FIDUCIARIES

18 SEC. 301. DEFINITION OF FIDUCIARY.

19 (a) IN GENERAL.—(1) Chapter 55 of title 38, United

20 States Code, is amended by adding at the end the fol21 lowing new section:

22 ‘‘§ 5506. Definition of ‘fiduciary’

23 ‘‘For purposes of this chapter and chapter 61 of this

24 title, the term ‘fiduciary’ means—
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1 ‘‘(1) a person who is a guardian, curator, con2 servator, committee, or person legally vested with

3 the responsibility or care of a claimant (or a claim4 ant’s estate) or of a beneficiary (or a beneficiary’s

5 estate); or

6 ‘‘(2) any other person having been appointed in

7 a representative capacity to receive money paid

8 under any of the laws administered by the Secretary

9 for the use and benefit of a minor, incompetent, or

10 other beneficiary.’’.

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

12 chapter is amended by adding at the end the following

13 new item:

‘‘5506. Definition of ‘fiduciary’.’’.

14 (b) CONFORMING AMENDMENTS TO SECTION

15 5502.—Section 5502 of such title is amended—

16 (1) in subsection (a)—

17 (A) in paragraph (1), by striking ‘‘other

18 person’’ and inserting ‘‘other fiduciary’’; and

19 (B) in the second sentence of paragraph

20 (2), by inserting ‘‘for benefits under this title’’

21 after ‘‘in connection with rendering fiduciary

22 services’’;

23 (2) in subsection (b), by striking ‘‘guardian, cu24 rator, conservator, or other person’’ each place it ap25 pears and inserting ‘‘fiduciary’’; and
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1 (3) in subsection (d), by striking ‘‘guardian, cu2 rator, or conservator’’ and inserting ‘‘fiduciary’’.

3 (c) CONFORMING AMENDMENT TO SECTION 6101.—

4 Section 6101(a) of such title is amended by striking

5 ‘‘guardian, curator,’’ and all that follows through ‘‘bene6 ficiary,’’ and inserting ‘‘fiduciary (as defined in section

7 5506 of this title) for the benefit of a minor, incompetent,

8 or other beneficiary under laws administered by the Sec9 retary,’’.

10 SEC. 302. INQUIRY, INVESTIGATIONS, AND QUALIFICATION

11 OF FIDUCIARIES.

12 (a) IN GENERAL.—Chapter 55 of title 38, United

13 States Code, as amended by section 301(a)(1), is further

14 amended by adding at the end the following new section:

15 ‘‘§ 5507. Inquiry, investigations, and qualification of

16 fiduciaries

17 ‘‘(a) Any certification of a person for payment of ben18 efits of a beneficiary to that person as such beneficiary’s

19 fiduciary under section 5502 of this title shall be made

20 on the basis of—

21 ‘‘(1) an inquiry or investigation by the Sec22 retary of the fitness of that person to serve as fidu23 ciary for that beneficiary, such inquiry or

24 investigation—
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1 ‘‘(A) to be conducted in advance of such

2 certification;

3 ‘‘(B) to the extent practicable, to include a

4 face-to-face interview with such person; and

5 ‘‘(C) to the extent practicable, to include a

6 copy of a credit report for such person issued

7 within one year of the date of the proposed ap8 pointment;

9 ‘‘(2) adequate evidence that certification of that

10 person as fiduciary for that beneficiary is in the in11 terest of such beneficiary (as determined by the Sec12 retary under regulations); and

13 ‘‘(3) the furnishing of any bond that may be re14 quired by the Secretary.

15 ‘‘(b) As part of any inquiry or investigation of any

16 person under subsection (a), the Secretary shall request

17 information concerning whether that person has been con18 victed of any offense under Federal or State law which

19 resulted in imprisonment for more than one year. If that

20 person has been convicted of such an offense, the Sec21 retary may certify the person as a fiduciary only if the

22 Secretary makes a specific finding that the person has

23 been rehabilitated and is an appropriate person to act as

24 fiduciary for the beneficiary concerned under the cir25 cumstances.
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1 ‘‘(c)(1) In the case of a proposed fiduciary described

2 in paragraph (2), the Secretary, in conducting an inquiry

3 or investigation under subsection (a)(1), may carry out

4 such inquiry or investigation on an expedited basis that

5 may include waiver of any specific requirement relating

6 to such inquiry or investigation, including the otherwise

7 applicable provisions of subparagraphs (A), (B), and (C)

8 of such subsection. Any such inquiry or investigation car9 ried out on such an expedited basis shall be carried out

10 under regulations prescribed for purposes of this section.

11 ‘‘(2) Paragraph (1) applies with respect to a proposed

12 fiduciary who is—

13 ‘‘(A) the parent (natural, adopted, or step14 parent) of a beneficiary who is a minor;

15 ‘‘(B) the spouse or parent of an incompetent

16 beneficiary;

17 ‘‘(C) a person who has been appointed a fidu18 ciary of the beneficiary by a court of competent ju19 risdiction; or

20 ‘‘(D) being appointed to manage an estate

21 where the annual amount of veterans benefits to be

22 managed by the proposed fiduciary does not exceed

23 $3600, as adjusted pursuant to section 5312 of this

24 title.
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1 ‘‘(d) TEMPORARY FIDUCIARIES.—When in the opin2 ion of the Secretary, a temporary fiduciary is needed in

3 order to protect the assets of the beneficiary while a deter4 mination of incompetency is being made or appealed or

5 a fiduciary is appealing a determination of misuse, the

6 Secretary may appoint one or more temporary fiduciaries

7 for a period not to exceed 120 days. If a final decision

8 has not been made within 120 days, the Secretary may

9 not continue the appointment of the fiduciary without ob10 taining a court order for appointment of a guardian, con11 servator, or other fiduciary under the authority provided

12 in section 5502(b) of this title.’’.

13 (b) CLERICAL AMENDMENT.—The table of sections

14 at the beginning of such chapter is amended by adding

15 after the item added by section 301(a)(2) the following

16 new item:

‘‘5507. Inquiry, investigations, and qualification of fiduciaries.’’.

17 SEC. 303. MISUSE OF BENEFITS BY FIDUCIARIES.

18 (a) PROTECTION OF VETERANS BENEFITS WHEN

19 ADMINISTERED BY FIDUCIARIES.—(1) Chapter 61 of title

20 38, United States Code, is amended by adding at the end

21 the following new sections:

22 ‘‘§ 6106. Misuse of benefits by fiduciaries

23 ‘‘(a) FEE FORFEITURE IN CASE OF BENEFIT MIS24 USE BY FIDUCIARIES.—A fiduciary may not collect a fee

25 from a beneficiary for any month with respect to which
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1 the Secretary or a court of competent jurisdiction has de2 termined that the fiduciary misused all or part of the indi3 vidual’s benefit, and any amount so collected by the fidu4 ciary as a fee for such month shall be treated as a misused

5 part of the individual’s benefit.

6 ‘‘(b) LIABILITY OF FIDUCIARIES FOR MISUSED BEN7 EFITS.—(1) If the Secretary or a court of competent juris8 diction determines that a fiduciary that is not a Federal,

9 State, or local government agency has misused all or part

10 of a beneficiary’s benefit that was paid to such fiduciary,

11 the fiduciary shall be liable for the amount misused, and

12 such amount (to the extent not repaid by the fiduciary)

13 shall be treated as an erroneous payment of benefits under

14 this title to the fiduciary for purposes of laws pertaining

15 to the recovery of overpayments. The amount of such over16 payment shall constitute a liability of such fiduciary to the

17 United States and may be recovered in the same manner

18 as any other debt due the United States. Subject to para19 graph (2), upon recovering all or any part of such amount,

20 the Secretary shall pay an amount equal to the recovered

21 amount to such beneficiary or such beneficiary’s successor

22 fiduciary.

23 ‘‘(2) The total of the amounts paid to a beneficiary

24 (or a beneficiary’s successor fiduciary) under paragraph

25 (1) and under section 6107 of this title may not exceed
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1 the total benefit amount misused by the fiduciary with re2 spect to that beneficiary.

3 ‘‘(c) MISUSE OF BENEFITS DEFINED.—For purposes

4 of this chapter, misuse of benefits by a fiduciary occurs

5 in any case in which the fiduciary receives payment, under

6 any of laws administered by the Secretary, for the use and

7 benefit of a beneficiary and uses such payment, or any

8 part thereof, for a use other than for the use and benefit

9 of such beneficiary or that beneficiary’s dependents. Re10 tention by a fiduciary of an amount of a benefit payment

11 as a fiduciary fee or commission, or as attorney’s fees (in12 cluding expenses) and court costs, if authorized by the

13 Secretary or a court of competent jurisdiction, shall be

14 considered to be for the use or benefit of such beneficiary.

15 ‘‘(d) REGULATIONS.—The Secretary may prescribe

16 by regulation the meaning of the term ‘use and benefit’

17 for purposes of this section.

18 ‘‘(e) FINALITY OF DETERMINATIONS.—A determina19 tion by the Secretary that a fiduciary has misused benefits

20 is a decision of the Secretary for purposes of section

21 511(a) of this title.

22 ‘‘§ 6107. Reissuance of benefits

23 ‘‘(a) NEGLIGENT FAILURE BY SECRETARY.—(1) In

24 any case in which the negligent failure of the Secretary

25 to investigate or monitor a fiduciary results in misuse of
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1 benefits by the fiduciary, the Secretary shall pay to the

2 beneficiary or the beneficiary’s successor fiduciary an

3 amount equal to the amount of benefits that were so mis4 used.

5 ‘‘(2) There shall be considered to have been a neg6 ligent failure by the Secretary to investigate and monitor

7 a fiduciary in the following cases:

8 ‘‘(A) A case in which the Secretary failed to

9 timely review a fiduciary’s accounting.

10 ‘‘(B) A case in which the Secretary was notified

11 of allegations of misuse, but failed to act in a timely

12 manner to terminate the fiduciary.

13 ‘‘(C) In any other case in which actual neg14 ligence is shown.

15 ‘‘(b) REISSUANCE OF MISUSED BENEFITS IN OTHER

16 CASES.—(1) In any case in which a fiduciary described

17 in paragraph (2) misuses all or part of an individual’s ben18 efit paid to such fiduciary, the Secretary shall pay to the

19 beneficiary or the beneficiary’s successor fiduciary an

20 amount equal to the amount of such benefit so misused.

21 ‘‘(2) Paragraph (1) applies to a fiduciary that—

22 ‘‘(A) is not an individual; or

23 ‘‘(B) is an individual who, for any month dur24 ing a period when misuse occurs, serves 10 or more

25 individuals who are beneficiaries under this title.
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1 ‘‘(c) RECOUPMENT OF AMOUNTS REISSUED.—In any

2 case in which the Secretary reissues a benefit payment (in

3 whole or in part) under subsection (a) or (b), the Sec4 retary shall make a good faith effort to obtain recoupment

5 from the fiduciary to whom the payment was originally

6 made.’’.

7 (b) CLERICAL AMENDMENT.—The table of sections

8 at the beginning of such chapter is amended by adding

9 at the end the following new items:

‘‘6106. Misuse of benefits by fiduciaries.

‘‘6107. Reissuance of benefits.’’.

10 SEC. 304. ADDITIONAL PROTECTIONS FOR BENEFICIARIES

11 WITH FIDUCIARIES.

12 (a) ONSITE REVIEWS AND REQUIRED ACCOUNT13 INGS.—(1) Chapter 55 of title 38, United States Code,

14 as amended by section 302(a), is further amended by add15 ing at the end the following new sections:

16 ‘‘§ 5508. Periodic onsite reviews of institutional fidu17 ciaries

18 ‘‘In addition to such other reviews of fiduciaries as

19 the Secretary may otherwise conduct, the Secretary shall

20 provide for the periodic onsite review of any person or

21 agency located in the United States that receives the bene22 fits payable under laws administered by the Secretary to

23 another individual pursuant to the appointment of such

24 person or agency as a fiduciary under section 5502(a)(1)
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1 of this title in any case in which the fiduciary is serving

2 in that capacity with respect to more than 20 beneficiaries

3 and the total annual amount of such benefits exceeds

4 $50,000, as adjusted pursuant to section 5312 of this

5 title.

6 ‘‘§ 5509. Authority to redirect delivery of benefit pay7 ments when a fiduciary fails to provide

8 required accounting

9 ‘‘(a) REQUIRED REPORTS AND ACCOUNTINGS.—The

10 Secretary may require a fiduciary to file a report or ac11 counting pursuant to regulations prescribed by the Sec12 retary.

13 ‘‘(b) ACTIONS UPON FAILURE TO FILE.—In any case

14 in which a fiduciary fails to submit a report or accounting

15 required by the Secretary under subsection (a), the Sec16 retary may, after furnishing notice to such fiduciary and

17 the beneficiary entitled to such payment of benefits, re18 quire that such fiduciary appear in person at a regional

19 office of the Department serving the area in which the

20 beneficiary resides in order to receive such payments.’’.

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

22 chapter is amended by adding after the item added by sec23 tion 302(b) the following new items:

‘‘5508. Periodic onsite reviews of institutional fiduciaries.

‘‘5509. Authority to redirect delivery of benefit payments when a fiduciary fails

to provide required accounting.’’.
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1 (b) CIVIL MONETARY PENALTIES; JUDICIAL ORDERS

2 OF RESTITUTION.—(1) Chapter 61 of title 38, United

3 States Code, as amended by section 303(a), is further

4 amended by adding at the end the following new sections:

5 ‘‘§ 6108. Civil monetary penalties

6 ‘‘(a) PENALTY FOR CONVERSION.—Any person (in7 cluding an organization, agency, or other entity) who, hav8 ing received, while acting in the capacity of a fiduciary

9 pursuant to section 5502 of this title, a payment under

10 a law administered by the Secretary for the use and ben11 efit of another individual, converts such payment, or any

12 part thereof, to a use that such person knows or should

13 know is other than for the use and benefit of such other

14 individual shall be subject to, in addition to any other pen15 alty that may be prescribed by law, a civil monetary pen16 alty assessed by the Secretary of not more than $5,000

17 for each such conversion.

18 ‘‘(b) PENALTY IN LIEU OF DAMAGES.—Any person

19 who makes a conversion of a payment described in sub20 section (a) and is subject to a civil monetary penalty under

21 that subsection by reason of such conversion shall also be

22 subject to an assessment by the Secretary, in lieu of dam23 ages sustained by the United States resulting from the

24 conversion, of not more than twice the amount of any pay25 ments so converted.
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1 ‘‘(c) COSTS OF RECOVERY.—From amounts collected

2 under this section, the amount necessary to recoup the De3 partment’s costs of such collection shall be credited to ap4 propriations currently available for the same purpose as

5 the appropriation that incurred those costs, to remain

6 available until expended.

7 ‘‘§ 6109. Authority for judicial orders of restitution

8 ‘‘(a) Any Federal court, when sentencing a defendant

9 convicted of an offense arising from the misuse of benefits

10 under this title, may order, in addition to or in lieu of

11 any other penalty authorized by law, that the defendant

12 make restitution to the Department.

13 ‘‘(b) Sections 3612, 3663, and 3664 of title 18 shall

14 apply with respect to the issuance and enforcement of or15 ders of restitution under subsection (a). In so applying

16 those sections, the Department shall be considered the vic17 tim.

18 ‘‘(c) If the court does not order restitution, or orders

19 only partial restitution, under subsection (a), the court

20 shall state on the record the reasons therefor.

21 ‘‘(d)(1) Except as provided in paragraph (2),

22 amounts received or recovered by the Secretary pursuant

23 to an order of restitution under subsection (a), to the ex24 tent and in the amounts provided in advance in appropria25 tions Acts, shall be available to defray expenses incurred
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1 by the Office of the Inspector General for the investigation

2 of fiduciaries under this title.

3 ‘‘(2) Paragraph (1) shall not apply with respect to

4 amounts received in connection with misuse by a fiduciary

5 of funds paid as benefits under laws administered by the

6 Secretary. Such amounts shall be paid to the individual

7 whose benefits were misused unless the Secretary has pre8 viously reissued the misused benefits, in which case the

9 amounts shall be treated in the same manner as overpay10 ments recouped by the Secretary and shall be deposited

11 to the credit of the applicable revolving fund, trust fund,

12 or appropriation.’’.

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

14 chapter is amended by adding after the item added by sec15 tion 303(b) the following new items:

‘‘6108. Civil monetary penalties.

‘‘6109. Authority for judicial orders of restitution.’’.

16 SEC. 305. ANNUAL REPORT.

17 (a) IN GENERAL.—Chapter 55 of title 38, United

18 States Code, as amended by section 304(a)(1), is further

19 amended by adding at the end the following new section:

20 ‘‘§ 5510. Annual report

21 ‘‘The Secretary shall include in the Annual Benefits

22 Report of the Veterans Benefits Administration or the

23 Secretary’s Annual Performance and Accountability Re24 port information concerning fiduciaries who have been ap-
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1 pointed to receive payments for beneficiaries of the De2 partment. As part of such information, the Secretary shall

3 separately set forth the following:

4 ‘‘(1) The number of beneficiaries in each cat5 egory (veteran, surviving spouse, child, adult dis6 abled child, or parent).

7 ‘‘(2) The types of benefit being paid (compensa8 tion, pension, dependency and indemnity compensa9 tion, death pension or benefits payable to a disabled

10 child under chapter 18 of this title).

11 ‘‘(3) The total annual amounts and average an12 nual amounts of benefits paid to fiduciaries for each

13 category and type of benefit.

14 ‘‘(4) The number of fiduciaries who are the

15 (spouse, parent, legal custodian, court-appointed fi16 duciary, institutional fiduciary, custodian in fact,

17 and supervised direct payment).

18 ‘‘(5) The number of cases in which the fidu19 ciary was changed by the Secretary because of a

20 finding that benefits had been misused.

21 ‘‘(6) How such cases of misuse of benefits were

22 addressed by the Secretary.

23 ‘‘(7) The final disposition of such cases of mis24 use of benefits, including the number and dollar

25 amount of any civil or criminal penalties imposed.
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1 ‘‘(8) Such other information as the Secretary

2 considers appropriate.’’.

3 (b) CLERICAL AMENDMENT.—The table of sections

4 at the beginning of such chapter is amended by adding

5 after the items added by the amendment made by section

6 304(a)(2) the following new item:

‘‘5510. Annual report.’’.

7 SEC. 306. ANNUAL ADJUSTMENT IN BENEFITS THRESH8 OLDS.

9 Section 5312(b)(1) of title 38, United States Code,

10 is amended by inserting ‘‘and the annual benefit amount

11 limitations under sections 5507(c)(2)(D) and 5508 of this

12 title,’’ after ‘‘(d)(3) of such section,’’.

13 SEC. 307. EFFECTIVE DATES.

14 (a) IN GENERAL.—Except as otherwise provided, this

15 title and the amendments made by this title shall take ef16 fect on the first day of the seventh month beginning after

17 the date of the enactment of this Act.

18 (b) SPECIAL RULES.—(1) Section 5510 of title 38,

19 United States Code, as added by section 305(a), shall take

20 effect on the date of the enactment of this Act.

21 (2) Sections 6106 and 6107 of title 38, United States

22 Code, as added by section 303(a), shall apply with respect

23 to any determinations by the Secretary of Veterans Affairs

24 made after the date of the enactment of this Act of misuse

25 of funds by a fiduciary.
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1 TITLE IV—OTHER MATTERS

2 SEC. 401. INVENTORY OF MEDICAL WASTE MANAGEMENT

3 ACTIVITIES AT DEPARTMENT HEALTH-CARE

4 FACILITIES.

5 (a) INVENTORY.—The Secretary of Veterans Affairs

6 shall establish and maintain a national inventory of med7 ical waste management activities in the health-care facili8 ties of the Department of Veterans Affairs. The inventory

9 shall include the following:

10 (1) A statement of the current national policy

11 of the Department on managing and disposing of

12 medical waste, including regulated medical waste in

13 all its forms.

14 (2) A description of the program of each geo15 graphic service area of the Department to manage

16 and dispose of medical waste, including general med17 ical waste and regulated medical waste, with a de18 scription of the primary methods used in those pro19 grams and the associated costs of those programs,

20 with cost information shown separately for in-house

21 costs (including full-time equivalent employees) and

22 contract costs.

23 (b) REPORT.—Not later than April 15, 2005, the

24 Secretary of Veterans Affairs shall submit to the Commit25 tees on Veterans’ Affairs of the Senate and House of Rep-
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1 resentatives a report on medical waste management activi2 ties in the facilities of the Department of Veterans Affairs.

3 The report shall include the following:

4 (1) The inventory established under subsection

5 (a), including all the matters specified in that sub6 section.

7 (2) A listing of each violation of medical waste

8 management and disposal regulations reported at

9 any health-care facility of the Department over the

10 preceding five years by any State or Federal agency,

11 along with an explanation of any remedial or other

12 action taken by the Secretary in response to each

13 such reported violation.

14 (3) A description of any plans to modernize,

15 consolidate, or otherwise improve the management of

16 medical waste and disposal programs at health-care

17 facilities of the Department, including the projected

18 costs associated with such plans and any barriers to

19 achieving goals associated with such plans.

20 (4) An assessment or evaluation of the available

21 methods of disposing of medical waste and identi22 fication of which of those methods are more desir23 able from an environmental perspective in that they

24 would be least likely to result in contamination of air

25 or water or otherwise cause future cleanup problems.
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1 SEC. 402. TECHNICAL AMENDMENTS TO EDUCATION PRO2 GRAM PROVISIONS.

3 (a) INAPPLICABILITY OF WAGE REQUIREMENTS FOR

4 ON-JOB TRAINING PROGRAMS LEADING TO SELF-EM5 PLOYMENT.—(1) Section 3677(b) is amended by adding

6 at the end the following new paragraph:

7 ‘‘(3) Notwithstanding paragraph (1)(A) and sub8 section (c)(8), no wages shall be required to be paid an

9 eligible person or veteran by a training establishment de10 scribed in section 3452(e)(2) of this title.’’.

11 (2) Section 3452(e), as amended by section 301 of

12 the Veterans Benefits Act of 2003 (Public Law 108–183;

13 117 Stat. 2658), is amended by striking ‘‘An’’ in para14 graph (2) and inserting ‘‘For the period beginning on Oc15 tober 1, 2005, and ending on September 30, 2010, an’’.

16 (b) EFFECTIVE DATE.—The amendments made by

17 subsection (a) shall take effect as if included in the enact18 ment of section 301 of the Veterans Benefits Act of 2003

19 (Public Law 108–183; 117 Stat. 2658).

Passed the House of Representatives October 7 (legislative day, October 6), 2004.

Attest:

Clerk.

108TH CONGRESS

2D SESSION H. R. 4658

AN ACT

To amend the Servicemembers Civil Relief Act to

called to active duty, and for other purposes.tections provided to reserve component memberstions to that Act, otherwise to improve legal promake certain improvements and technical correc-