Title: Veteran Debt Fairness Act of 2018
Policy area: Armed Forces and National Security

Summary:
Veteran Debt Fairness Act of 2018
This bill limits the ability of the Department of Veterans Affair to recover overpayments of benefits from veterans.

[Congressional Bills 115th Congress]
[From the U.S. Government Publishing Office]
[H.R. 7144 Introduced in House (IH)]

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115th CONGRESS
  2d Session
                                H. R. 7144

  To amend title 38, United States Code, to improve the processing of 
 veterans benefits by the Department of Veterans Affairs, to limit the 
authority of the Secretary of Veterans Affairs to recover overpayments 
made by the Department and other amounts owed by veterans to the United 
 States, to improve the due process accorded veterans with respect to 
                 such recovery, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           November 16, 2018

Mr. Delaney (for himself, Mr. Trott, Mr. Ryan of Ohio, Mr. Coffman, Mr. 
Sean Patrick Maloney of New York, Mrs. Dingell, Mr. Foster, Mr. Raskin, 
Mr. Kilmer, and Mr. Johnson of Georgia) introduced the following bill; 
        which was referred to the Committee on Veterans' Affairs

_______________________________________________________________________

                                 A BILL


 
  To amend title 38, United States Code, to improve the processing of 
 veterans benefits by the Department of Veterans Affairs, to limit the 
authority of the Secretary of Veterans Affairs to recover overpayments 
made by the Department and other amounts owed by veterans to the United 
 States, to improve the due process accorded veterans with respect to 
                 such recovery, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Veteran Debt Fairness Act of 2018''.

SEC. 2. LIMITATIONS ON AUTHORITY OF THE SECRETARY OF VETERANS AFFAIRS 
              TO RECOVER AMOUNTS OWED BY VETERANS TO THE UNITED STATES.

    (a) Indebtedness Offsets.--Section 5314 of title 38, United States 
Code, is amended as follows:
            (1) In subsection (a)--
                    (A) by inserting ``Authority To Offset; 
                Limitations.--(1)'' before ``Subject to'';
                    (B) by striking ``subsections (b) and (d) of this 
                section and'' and inserting ``paragraphs (2) and (3) of 
                this subsection, subsections (b) and (d) of this 
                section, and''; and
                    (C) by adding at the end the following new 
                paragraph:
    ``(2) The Secretary may make a deduction under paragraph (1) only 
if--
            ``(A) the indebtedness to the United States described in 
        that paragraph--
                    ``(i) is the result of an error, a 
                misrepresentation, or fraud by the person described in 
                that paragraph;
                    ``(ii) in the case of an error by the person 
                described in that paragraph, is less than five years 
                old;
                    ``(iii) is not in dispute under regulations 
                prescribed pursuant to subsection (d)(2)(A); and
                    ``(iv) exceeds $2,500; and
            ``(B) the Secretary determines that the amount of the 
        indebtedness exceeds the cost to the Department to recover the 
        indebtedness.
    ``(3) The Secretary may not make a deduction under paragraph (1) to 
a payment under chapter 11 or 15 of this title that exceeds the lesser 
of--
            ``(A) 25 percent of the payment; and
            ``(B) a percentage that the Secretary determines is the 
        greatest percentage that would not cause a hardship to the 
        recipient.''.
            (2) In subsection (b)--
                    (A) by striking ``Deductions may not be made'' and 
                inserting ``Notice Required.--No deduction may be 
                made'';
                    (B) by striking ``unless the Secretary'' and 
                inserting ``until after'';
                    (C) by amending paragraph (1) to read as follows:
    ``(1) the Secretary has made reasonable efforts to notify the 
person of the person's right--
            ``(A) to dispute the existence or amount of such 
        indebtedness under regulations prescribed pursuant to 
        subsection (d)(2)(A);
            ``(B) to request a waiver of such indebtedness under 
        section 5302 of this title; and
            ``(C) in the case of a payment under chapter 11 or 15 of 
        this title, to request the Secretary make a determination under 
        subsection (a)(3)(B);''; and
                    (D) in paragraph (2), by inserting ``the 
                Secretary'' before ``has made''; and
                    (E) by amending paragraph (3) to read as follows:
    ``(3) the day that is 90 calendar days after the day the Secretary 
sends notice to the person of the indebtedness and of the proposed 
deduction.''.
            (3) In subsection (c), by inserting ``Inapplicability of 
        Statutes of Limitations to Administrative Actions.--'' before 
        ``Notwithstanding''.
            (4) In subsection (d)--
                    (A) by inserting ``Regulations.--(1)'' before ``The 
                Secretary'' ; and
                    (B) by adding at the end the following new 
                paragraph:
    ``(2) The regulations under paragraph (1) shall include 
administrative processes by which a person described in paragraph (1) 
of subsection (a) may--
            ``(A) dispute the existence or amount of indebtedness 
        described in that paragraph; and
            ``(B) request that the Secretary make a determination under 
        paragraph (3)(B) of such subsection.
    ``(3) The regulations under paragraph (1) shall direct the 
Secretary to ensure that each dispute under paragraph (2)(A) is 
adjudicated not later than 120 days after the initiation of such 
dispute.
    ``(4) The regulations under paragraph (1) may not permit the 
Secretary to submit to any debt collector (as defined in section 803 of 
the Fair Debt Collection Practices Act (15 U.S.C. 1692a)) any debt in 
dispute under paragraph (2)(A).
    ``(5) Nothing in this subsection shall be construed to prohibit a 
person from seeking relief from a court of competent jurisdiction.''.
    (b) Limitations on Interest and Fees Charged During Period of 
Dispute.--Section 5315 of such title is amended--
            (1) in subsection (b)(1), in the first sentence by striking 
        ``or (B)'' and inserting ``(B) for any period during which the 
        existence or amount of the indebtedness is being disputed under 
        regulations prescribed pursuant to section 5314(d) of this 
        title, or (C)''; and
            (2) in subsection (c)--
                    (A) by inserting ``(1)'' before ``The 
                administrative''; and
                    (B) by adding at the end the following new 
                paragraph:
    ``(2) No administrative costs may be charged under this section 
with respect to indebtedness described in subsection (a) while the 
existence or amount of the indebtedness is being disputed under section 
5314(d) of this title.''.
    (c) Limitation on Authority To Sue To Collect Certain Debts.--
Section 5316(a) of title 38, United States, is amended--
            (1) in paragraph (1), by striking ``paragraphs (2) and 
        (3)'' and inserting ``paragraphs (2), (3), and (4)'';
            (2) by redesignating paragraph (3) as paragraph (4); and
            (3) by inserting after paragraph (2) the following new 
        paragraph (3):
    ``(3) No suit may be filed under this section to recover any 
indebtedness more than five years old.''.
    (d) Repair of Credit.--
            (1) In general.--Chapter 53 of such title is amended by 
        adding at the end the following new section:
``Sec. 5320. Correction of erroneous information submitted to consumer 
              reporting agencies
    ``(a) Correcting Errors by the Department.--In any case in which 
the Secretary finds that the Department has submitted erroneous 
information to a consumer reporting agency about the indebtedness of 
any person who has been determined by the Secretary to be indebted to 
the United States by virtue of the participation of that person in a 
benefits program administered by the Secretary, the Secretary shall--
            ``(1) instruct the consumer reporting agency to remove such 
        erroneous information from the consumer report of such person 
        or take such other action as may be required to ensure that 
        such erroneous information is not included in the report of 
        such person; and
            ``(2) transmit to the consumer reporting agency such 
        information as the consumer reporting agency may require to 
        take such appropriate actions.
    ``(b) Correcting Errors by Debt Collectors.--In any case in which 
the Secretary finds that a debt collector acting on behalf of the 
Department has submitted erroneous information to a consumer reporting 
agency about the indebtedness of any person who has been determined by 
the Secretary to be indebted to the United States by virtue of the 
participation of that person in a benefits program administered by the 
Secretary, the Secretary shall instruct the debt collector to request 
the consumer reporting agency remove such erroneous information from 
the consumer report of such person or take such other action as may be 
required to ensure such erroneous information is not included in the 
report of such person.
    ``(c) Notice.--Not later than 60 days after the date on which the 
Secretary issues an instruction under subsection (a)(1) or (b) with 
respect to a person, the Secretary shall notify the person that the 
Secretary issued such instruction.
    ``(d) Definitions.--In this section:
            ``(1) The terms `consumer report' and `consumer reporting 
        agency' have the meanings given such terms in section 603 of 
        the Fair Credit Reporting Act (15 U.S.C. 1681a).
            ``(2) The term `debt collector' has the meaning given such 
        term in section 803 of the Fair Debt Collection Practices Act 
        (15 U.S.C. 1692a).''.
            (2) Clerical amendment.--The table of sections at the 
        beginning of chapter 53 of such title is amended by adding at 
        the end the following new item:

``5320. Correction of erroneous information submitted to consumer 
                            reporting agencies.''.
    (e) Effective Date.--The amendments made by this section shall take 
effect on the date of the enactment of this Act and shall apply with 
respect to deductions made under section 5314 of such title, 
administrative costs under section 5315 of such title, and suits filed 
under section 5316 of such title on or after such date.

SEC. 3. IMPROVED PROCESSING OF BENEFITS BY DEPARTMENT OF VETERANS 
              AFFAIRS.

    The Secretary of Veterans Affairs shall improve the information 
technology of the Department of Veterans Affairs (including the 
eBenefits system or successor system) as may be necessary to achieve 
the following:
            (1) Notification of debts incurred.--The Secretary shall 
        provide a notification to a person who--
                    (A) is entitled to a payment from the Secretary 
                under a benefits program administered by the Secretary;
                    (B) incurs a debt to the United States under that 
                benefits program; and
                    (C) elects to receive such notifications.
            (2) Review of information regarding dependents.--A person 
        entitled to a payment from the Secretary under a benefits 
        program administered by the Secretary may review information 
        relating to dependents of that person.
            (3) Tracking metrics.--The Secretary shall be able to 
        track--
                    (A) the number and amount of payments made by the 
                Secretary to a person entitled to a payment from the 
                Secretary under a benefits program administered by the 
                Secretary who incurs a debt to the United States under 
                such program;
                    (B) the average debt to the United States incurred 
                by a person described in subparagraph (A);
                    (C) how frequently the Secretary approves and 
                denies applications for relief under section 5302(a) of 
                title 38, United States Code; and
                    (D) such other metrics the Secretary determines 
                appropriate.

SEC. 4. AUDIT OF ERRONEOUS PAYMENTS BY VETERANS BENEFITS 
              ADMINISTRATION; PLAN OF CORRECTION.

    (a) Audit.--Not later than 180 days after the date of the enactment 
of this Act, the Secretary of Veterans Affairs shall complete an audit 
to determine the following:
            (1) The frequency by which the Department of Veterans 
        Affairs makes an error that results in a payment to a person by 
        virtue of such person's participation in a benefits program 
        administered by the Secretary that such person is not entitled 
        to or in an amount that exceeds the amount to which the person 
        is entitled.
            (2) Whether and to what degree vacant positions in the 
        Veterans Benefits Administration affect such frequency.
    (b) Plan.--Not later than 30 days after the completion of the audit 
under subsection (a), the Secretary of Veterans Affairs shall submit to 
the Committees on Veterans' Affairs of the Senate and House of 
Representatives a plan and description of resources necessary to align 
information technology systems to ensure that errors described in 
subsection (a)(1) are not the result of communication or absence of 
communication between information technology systems.
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