Title: SHIELD for Veterans Act of 2020
Policy area: Armed Forces and National Security

Summary:
Veteran Debt Fairness Act of 2019
This bill limits the authority of the Department of Veterans Affairs (VA) to recover overpayments of benefits from veterans. Among other requirements, the VA must update its information technology systems to allow for expedited notification when a veteran incurs a debt via participation in a VA benefits program.
The VA may only deduct the amount of debt of any veteran who is in debt because of participation in a VA benefits program from future benefit payments if the debt is the result of the following:
Additionally, the bill requires the VA to prescribe an administrative process for the dispute of the existence or amount of debt.
The bill also prohibits the VA from recovering certain debt that is more than five years old or withholding more than 25% of certain benefit payments.
Finally, the bill prescribes procedures by which the VA and debt collectors shall correct errors submitted to consumer reporting agencies.


[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[S. 805 Introduced in Senate (IS)]

<DOC>






116th CONGRESS
  1st Session
                                 S. 805

  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 SENATE OF THE UNITED STATES

                             March 14, 2019

 Mr. Tester (for himself, Mr. Boozman, Mr. Brown, Mr. Blumenthal, Ms. 
    Stabenow, Ms. Harris, Ms. Warren, Mr. Wyden, and Mrs. Shaheen) 
introduced the following bill; which was read twice and 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 2019''.

SEC. 2. IMPROVING PROCESSING OF VETERANS BENEFITS BY DEPARTMENT OF 
              VETERANS AFFAIRS.

    (a) Notification of Debts Incurred.--The Secretary of Veterans 
Affairs shall make such changes to such information technology systems 
of the Department of Veterans Affairs, including the eBenefits system 
or successor system, as may be necessary so that a person who is 
entitled to a payment from the Department by virtue of the person's 
participation in a benefits program administered by the Secretary will 
receive, at the request of the person, a notice from the Department 
through means selected by the individual (by electronic mail or other 
mechanism) whenever such person incurs a debt to the United States by 
virtue of such participation.
    (b) Updating Dependent Information.--The Secretary shall make such 
changes to such information technology systems of the Department, 
including the eBenefits system or successor system, as may be necessary 
so that whenever the Secretary records in such systems information 
about a dependent of a person, the person is able to review and revise 
such information.
    (c) Tracking of Metrics.--The Secretary shall make such changes to 
such information technology systems of the Department as may be 
necessary to track the following:
            (1) The number and amount of payments made by the 
        Department to persons as part of a benefits program 
        administered by the Secretary which result in the persons 
        incurring a debt to the United States by virtue of such 
        payments.
            (2) The average debt to the United States incurred by a 
        person by virtue of a payment described in paragraph (1).
            (3) The frequency by which applications for relief under 
        section 5302(a) of title 38, United States Code, are approved 
        and denied.
            (4) Such other metrics as the Secretary considers 
        appropriate.

SEC. 3. REFORMS RELATING TO RECOVERY BY DEPARTMENT OF VETERANS AFFAIRS 
              OF AMOUNTS OWED BY VETERANS TO THE UNITED STATES.

    (a) Indebtedness Offsets.--
            (1) Limitation on scope of authority.--Subsection (a) of 
        section 5314 of title 38, United States Code, is amended--
                    (A) by inserting ``(1)'' before ``Subject to'';
                    (B) in paragraph (1), as designated by subparagraph 
                (A), by striking ``to subsections (b) and (d) of this 
                section'' and inserting ``to paragraphs (2) through (6) 
                of this subsection, subsections (b) and (e) of this 
                section,''; and
                    (C) by adding at the end the following new 
                paragraph:
    ``(2) Notwithstanding any other provision of law, the Secretary may 
only deduct under paragraph (1) an amount of the indebtedness of a 
veteran, the estate of a veteran, a spouse or child of a veteran who is 
deceased, or a recipient of educational assistance under chapter 30, 
31, 32, 33, 34, or 35 of this title if the indebtedness is a result of 
one or more of the following:
            ``(A) An error made by or failure to report required 
        information to the Department by the veteran, estate, spouse, 
        child, or recipient of educational assistance, as the case may 
        be.
            ``(B) Fraud perpetrated by the veteran, estate, spouse, 
        child, or recipient of educational assistance, as the case may 
        be.
            ``(C) A misrepresentation made by the veteran, estate, 
        spouse, child, or recipient of educational assistance, as the 
        case may be.
            ``(D) In the case of a recipient of educational assistance 
        under such chapters, a reduction in or termination of pursuit 
        of a program of education by the recipient.
            ``(E) A failure described in section 3319(i)(2)(A) of this 
        title.
    ``(3)(A) The Secretary may not deduct under paragraph (1) from any 
payment made under chapter 11 or 15 of this title more than the lessor 
of--
            ``(i) 25 percent of such payment; or
            ``(ii) such other percent of such payment as the Secretary 
        and the person whose future payments are to be reduced under 
        paragraph (1) agree would not cause a hardship to the person of 
        the payment.
    ``(B) A person whose future payments are to be reduced under 
paragraph (1) may request, via the administrative process prescribed 
under subsection (c), the Secretary make a determination under 
subparagraph (A)(ii) of this paragraph.
    ``(4) In the case of an indebtedness that was incurred as a result 
of an error or failure described in paragraph (2)(A), the Secretary may 
not deduct under paragraph (1) any amount relating to such indebtedness 
after the date that is five years after the date on which the debt was 
incurred.
    ``(5) The Secretary may not deduct under paragraph (1) any amount 
relating to an indebtedness while the existence or amount of such 
indebtedness is being--
            ``(A) disputed under subsection (c); or
            ``(B) appealed.
    ``(6) The Secretary may not deduct under paragraph (1) any amount 
if the Secretary determines that the cost that would be incurred by the 
Department to recover such amount would exceed the amount to be 
recovered.
    ``(7) Paragraphs (2) through (6) shall not apply to payments under 
chapter 19 of this title.''.
            (2) Due process.--
                    (A) Minimum period for notice.--Subsection (b) of 
                such section is amended--
                            (i) by amending paragraph (1) to read as 
                        follows:
            ``(1) has made reasonable efforts to notify such person of 
        such person's right--
                    ``(A) to dispute through prescribed administrative 
                processes the existence or amount of such indebtedness;
                    ``(B) to request a waiver of such indebtedness 
                under section 5302 of this title; and
                    ``(C) to request the Secretary make a determination 
                under subsection (a)(3)(A)(ii);''; and
                            (ii) by striking paragraph (3) and 
                        inserting the following new paragraphs:
            ``(3) has notified such person about the proposed 
        deductions by mailing a notice of intent letter, which--
                    ``(A) is mailed to the person--
                            ``(i) in the case of a debt incurred by a 
                        person by virtue of the person's participation 
                        in a program of educational assistance 
                        administered by the Secretary, not later than 
                        45 days before making any of such deductions; 
                        and
                            ``(ii) in the case of a debt incurred by a 
                        person by virtue of the person's participation 
                        in any other benefit program administered by 
                        the Secretary, not later than 90 days before 
                        making any of such deductions; and
                    ``(B) includes detailed information about the 
                indebtedness, including, in the case of an overpayment, 
                an itemized list of each overpayment and the specific 
                reason for the overpayment.''.
                    (B) Adjudication of disputes.--
                            (i) In general.--Such section is amended--
                                    (I) by redesignating subsections 
                                (c) and (d) as subsections (d) and (e); 
                                and
                                    (II) by inserting after subsection 
                                (b) the following new subsection (c):
    ``(c)(1) The Secretary shall prescribe an administrative process 
for--
            ``(A) the dispute of the existence or amount of an 
        indebtedness subject to subsection (a); and
            ``(B) making requests under paragraph (3)(B) of such 
        subsection.
    ``(2) The Secretary shall ensure that each dispute under paragraph 
(1)(A) is adjudicated not later than 120 days after the dispute is 
filed.
    ``(3) The Secretary may not submit to any debt collector (as 
defined in section 803 of the Fair Debt Collection Practices Act (15 
U.S.C. 1692a)) any debt pending adjudication under the process 
prescribed under paragraph (1).
    ``(4) Nothing in this subsection shall be construed to prohibit a 
person from seeking relief from a court of competent jurisdiction.''.
                            (ii) Limitations on interest and fees 
                        charged during period of dispute.--Section 5315 
                        of such title is amended--
                                    (I) 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 section 5314(c) of this title, or 
                                (C)''; and
                                    (II) in subsection (c)--
                                            (aa) by inserting ``(1)'' 
                                        before ``The administrative''; 
                                        and
                                            (bb) by adding at the end 
                                        the following new paragraph:
    ``(2) No administrative costs may be charged under this section 
with respect to an indebtedness described in subsection (a) while the 
existence or amount of the indebtedness is being disputed under section 
5314(c) of this title.''.
            (3) Effective date.--This subsection and the amendments 
        made by this subsection 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 on or after 
        such date.
            (4) Rule of construction.--This subsection and the 
        amendments made by this subsection shall be construed to apply 
        to an error in a payment to a person from the Department of 
        Veterans Affairs the person is entitled to by virtue of the 
        person's participation in a benefits program administered by 
        the Secretary of Veterans Affairs following the person's notice 
        to the Department of a change in the person's eligibility 
        regarding such benefit or participation.
    (b) Limitation on Authority To Sue To Collect Certain Debts.--
            (1) In general.--Section 5316(a) of such title is amended--
                    (A) in paragraph (1), by striking ``(2) and (3)'' 
                and inserting ``(2), (3), and (4)'';
                    (B) by redesignating paragraph (3) as paragraph 
                (4); and
                    (C) by inserting after paragraph (2) the following 
                new paragraph (3):
    ``(3) In the case of an indebtedness that was incurred as a result 
or an error or failure described in section 5314(a)(2)(A) of this 
title, no suit may be filed under this section to recover the 
indebtedness after the date that is five years after the date on which 
the debt was incurred.''.
            (2) Effective date.--This subsection and the amendments 
        made by this subsection shall take effect on the date of the 
        enactment of this Act and shall apply with respect to suits 
        filed under section 5316 of such title on or after such date.
    (c) Limitation on Cooperation With Other Federal Agencies To 
Collect.--Section 5316 of such title is amended by adding at the end 
the following new subsection:
    ``(d) The Secretary may not provide any information or assistance 
to any other element of the Federal Government to recover, whether by 
bringing suit in a court of competent jurisdiction, by deducting 
amounts from future payments, or by other method, any indebtedness of 
any person who has been determined to be indebted to the United States 
by virtue of such person's participation in a benefits program 
administered by the Secretary if the Secretary does not have the 
authority to recover such indebtedness under this title.''.
    (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 such person's participation 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 such 
person's participation 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) Audits.--
            (1) One-time 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:
                    (A) 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.
                    (B) Whether and to what degree vacant positions in 
                the Veterans Benefits Administration affect such 
                errors.
            (2) Annual audits.--Section 5314 of such title, as amended 
        by subsection (a), is further amended by adding at the end the 
        following new subsection:
    ``(f) Not less frequently than once each year, the Secretary shall 
complete an audit of not less than 10 percent of all debts to the 
United States incurred by virtue of a person's participation in a 
benefits program administered by the Secretary to identify errors.''.
    (f) Plan.--Not later than 180 days after the date of the enactment 
of this Act, the Secretary shall submit to the Committee on Veterans' 
Affairs of the Senate and the Committee on Veterans' Affairs of the 
House of Representatives a plan and description of resource 
requirements necessary to align information technology systems to 
ensure that errors described in subsection (d)(1) are not the result of 
communication or absence of communication between information 
technology systems.
    (g) Coordination With Other Federal Agencies.--
            (1) Interagency working group.--The Secretary of Veterans 
        Affairs may establish an interagency working to assess how 
        executive agencies should submit timely information to the 
        Secretary of Veterans Affairs in order to reduce overpayments 
        to veterans in the event of a life event, such as a change in 
        work status, incarceration, or change in marital status.
            (2) Quarterly reporting by secretary of defense to 
        secretary of veterans affairs.--Each quarter, the Secretary of 
        Defense shall transmit to the Secretary of Veterans Affairs 
        information on compensation received by members of the reserve 
        components of the Armed Forces who received during such quarter 
        for instruction, training, or other duties under section 206 of 
        title 37, United States Code.
                                 <all>