Election of Education Benefits

DEPARTMENT OF DEFENSE

DEPARTMENT OF TRANSPORTATION

Coast Guard

DEPARTMENT OF VETERANS AFFAIRS

38 CFR Part 21

RIN 2900-AH88

Election of Education Benefits

AGENCIES: Department of Defense, Department of Transportation (Coast

Guard), and Department of Veterans Affairs.

ACTION: Final rule.

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SUMMARY: This document amends the Department of Veterans Affairs (VA)

educational assistance and educational benefits regulations relating to

certain elections between benefits. VA has provided by regulation that

after a veteran seeks to make an election to have service in the

Selected Reserve credited toward payment under the Montgomery GI Bill--

Selected Reserve (MGIB-SR) program or under the Montgomery GI Bill--

Active Duty (MGIB-AD) program, the election will take effect when the

individual has negotiated a check issued under the program she or he

has elected. In order to adapt the regulations to the new system of

electronic transfers, these election provisions are changed to make the

election effective either upon negotiation of a check or electronic

receipt of education benefits. VA has provided by regulation that an

election to receive benefits under Survivors' and Dependents'

Educational Assistance (DEA) for a program of education rather than

pension, compensation, or Dependency and Indemnity Compensation (DIC)

will take effect when the individual has commenced a program of

education and negotiated a check issued under the program she or he has

elected. In order to adapt the regulations to the new system of

electronic transfers and to ensure that decisions are made with

knowledge, these election provisions are changed to require a written

election to be submitted and to make the election effective either upon

negotiation of a check or electronic receipt of education benefits.

Nonsubstantive changes are also made for purposes of clarity and to

reflect current statutory codification and authority. This final rule

also involves collections of information.

EFFECTIVE DATE: September 28, 1998.

FOR FURTHER INFORMATION CONTACT: William G. Susling, Jr., Education

Adviser, Education Service (225C), Veterans Benefits Administration,

Department of Veterans Affairs, (202) 273-7187.

SUPPLEMENTARY INFORMATION: In a document published in the Federal

Register on November 25, 1997 (62 FR 62736), it was proposed to amend

the ``SURVIVORS' AND DEPENDENTS' EDUCATIONAL ASSISTANCE UNDER 38 U.S.C.

CHAPTER 35'' regulations, the ``ALL VOLUNTEER FORCE EDUCATIONAL

ASSISTANCE PROGRAM (MONTGOMERY GI BILL--ACTIVE DUTY)'' regulations, and

the ``EDUCATIONAL ASSISTANCE FOR MEMBERS OF THE SELECTED RESERVE''

regulations as set forth in the SUMMARY portion of this document. These

regulations are set forth at 38 CFR Part 21, Subparts C, K, and L.

Interested persons were given 60 days to submit comments. No

comments were received. Based on the rationale set forth in the

proposed rule, we are adopting the provisions of the proposed rule as a

final rule.

The Department of Defense (DOD), the Department of Transportation

(Coast Guard), and VA are jointly issuing this final rule insofar as it

relates to the MGIB-SR program. This program is funded by DOD and the

Coast Guard, and is administered by VA. The remainder of this final

rule is issued solely by VA.

Paperwork Reduction Act of 1995

Information collection and recordkeeping requirements associated

with this final rule concerning Sec. 21.3023 have been approved by the

Office of Management and Budget (OMB) under the provisions of the

Paperwork Reduction Act (44 U.S.C. 3501-3520) and have been assigned

OMB control number 2900-0595. The final rule at Sec. 21.3023 requires

that an election to receive DEA rather than DIC must be made to VA in

writing.

Furthermore, information collection and recordkeeping requirements

associated with this final rule concerning Secs. 21.7042 and 21.7540

have been approved by OMB under the provisions of the Paperwork

Reduction Act (44 U.S.C. 3501-3520) and have been assigned OMB control

number 2900-0594. The final rule at Secs. 21.7042 and 21.7540 requires

that a veteran must choose to apply certain Selected Reserve service

either to MGIB--SR or MGIB.

OMB assigns control numbers to collections of information it

approves. VA may not conduct or sponsor, and a person is not required

to respond to, a collection of information unless it displays a

currently valid OMB control number. The valid OMB control number

assigned to each collection of information in this final rule is

displayed at the end of each affected section of the regulations.

Regulatory Flexibility Act

The signers of this document hereby certify that this final rule

does not have significant economic impact on a substantial number of

small entities as they are defined in the Regulatory Flexibility Act, 5

U.S.C. 601-612. This final rule directly affects only individuals and

does not directly affect small entities. Pursuant to 5 U.S.C. 605(b),

the final rule, therefore, is exempt from the initial and final

regulatory flexibility analyses requirements of Secs. 603 and 604.

The Catalog of Federal Domestic Assistance numbers for programs

affected by the final rule are 64.117 and 64.124. The final rule also

affects the Montgomery GI Bill--Selected Reserve for which there is no

Catalog of Federal Domestic Assistance number.

List of Subjects in 38 CFR Part 21

Administrative practice and procedure, Armed Forces, Civil rights,

Claims, Colleges and universities, Conflicts of interests, Defense

Department, Education, Educational institutions, Employment, Grant-

programs-education, Grant programs-veterans, Health care, Loan

programs-education, Loan programs-veterans, Manpower training programs,

Reporting and recordkeeping requirements, Schools, Travel and

transportation, Veterans, Vocational education, Vocational

rehabilitation.

[[Page 45718]]

Approved: May 19, 1998.

Togo D. West, Jr.,

Secretary of Veterans Affairs.

Approved: July 15, 1998.

Normand G. Lezy,

Lieutenant General, USAF, Deputy Assistant Secretary (Military

Personnel Policy), Department of Defense.

Approved: July 28, 1998.

T. J. Barrett,

RADM, USCG, Acting Assistant Commandant for Human Resources.

For the reasons set out in the preamble, 38 CFR part 21 (subparts

C, K, and L) is amended as set forth below.

PART 21--VOCATIONAL REHABILITATION AND EDUCATION

Subpart C--Survivors and Dependents Educational Assistance Under 38

U.S.C. Chapter 35

1. The authority citation for part 21, subpart C continues to read

as follows:

Authority: 38 U.S.C. 501(a), 512, 3500-3566, unless otherwise

noted.

2. In Sec. 21.3023, paragraph (c)(3) is amended by removing

``educational assistance'' and adding, in its place, ``education under

DEA''; the section heading, paragraph (c) introductory text, and

paragraph (c)(1) are revised; a parenthetical is added at the end of

the section, and an authority citation for the section is added, to

read as follows:

Sec. 21.3023 Nonduplication; pension, compensation, and dependency and

indemnity compensation.

* * * * *

(c) Child; election. An election by a child under this section must

be submitted to VA in writing.

(1) Except as provided in paragraph (c)(2) of this section, an

election to receive Survivors' and Dependents' Educational Assistance

(DEA) is final when the eligible child commences a program of education

under DEA (38 U.S.C. chapter 35). Commencement of a program of

education under DEA will be deemed to have occurred for VA purposes on

the date the first payment of DEA educational assistance is made, as

evidenced by negotiation of the first check or receipt of the first

payment by electronic funds transfer.

* * * * *

(The information collection requirements in this section have been

approved by the Office of Management and Budget under control number

2900-0595)

(Authority: 38 U.S.C. 3562)

Subpart K--All Volunteer Force Educational Assistance Program

(Montgomery GI Bill--Active Duty)

3. The authority citation for part 21, subpart K continues to read

as follows:

Authority: 38 U.S.C. 501(a), chs. 30, 36, unless otherwise

noted.

4. In Sec. 21.7042, the section heading and paragraphs (d)(2) and

(d)(3) are revised, paragraph (d)(4) and its authority citation are

added, and a parenthetical is added at the end of the section, to read

as follows:

Sec. 21.7042 Eligibility for basic educational assistance.

* * * * *

(d) * * *

(2) An individual must elect, in writing, whether he or she wishes

service in the Selected Reserve to be credited towards establishing

eligibility under 38 U.S.C. chapter 30 or under 10 U.S.C. chapter 1606

when:

(i) The individual:

(A) Is a veteran who has established eligibility for basic

educational assistance through meeting the provisions of paragraph (b)

of this section; and

(B) Also is a reservist who has established eligibility for

benefits under 10 U.S.C. chapter 1606 through meeting the requirements

of Sec. 21.7540; or

(ii) The individual is a member of the National Guard or Air

National Guard who has established eligibility for basic educational

assistance under 38 U.S.C. chapter 30 through activation under a

provision of law other than 32 U.S.C. 316, 502, 503, 504, or 505.

(3) An election under this paragraph (d) to have Selected Reserve

service credited towards eligibility for payment of educational

assistance under 38 U.S.C. chapter 30 or under 10 U.S.C. chapter 1606

is irrevocable when the veteran either negotiates the first check or

receives the first payment by electronic funds transfer of the

educational assistance elected.

(4) If a veteran is eligible to receive educational assistance

under both 38 U.S.C. chapter 30 and 10 U.S.C. chapter 1606, he or she

may receive educational assistance alternately or consecutively under

each of these chapters to the extent that the educational assistance is

based on service not irrevocably credited to one or the other chapter

as provided in paragraphs (d)(1) through (d)(3) of this section.

(Authority: 10 U.S.C. 16132, 38 U.S.C. 3033(c))

* * * * *

(The information requirements in this section have been approved by

the Office of Management and Budget under control number 2900-0594)

Subpart L--Educational Assistance for Members of the Selected

Reserve

5. The authority citation for part 21, subpart L is revised to read

as follows:

Authority: 10 U.S.C. ch. 1606; 38 U.S.C. 501, unless otherwise

noted.

6. In Sec. 21.7540, paragraph (c) and the authority citation for

paragraph (d) are revised, and a parenthetical is added at the end of

the section, to read as follows:

Sec. 21.7540 Eligibility for educational assistance.

* * * * *

(c) Limitations on establishing eligibility. (1) An individual must

elect in writing whether he or she wishes service in the Selected

Reserve to be credited towards establishing eligibility under 38 U.S.C.

chapter 30 or under 10 U.S.C. chapter 1606 when:

(i) The individual is a reservist who is eligible for basic

educational assistance provided under 38 U.S.C. 3012, and has

established eligibility to that assistance partially through service in

the Selected Reserve; or

(ii) The individual is a member of the National Guard or Air

National Guard who has established eligibility for basic educational

assistance provided under 38 U.S.C. 3012 through activation under a

provision of law other than 32 U.S.C. 316, 502, 503, 504, or 505

followed by service in the Selected Reserve.

(2) An election under this paragraph (c) to have Selected Reserve

service credited towards eligibility for payment of educational

assistance under 38 U.S.C. chapter 30 or under 10 U.S.C. chapter 1606

is irrevocable when the reservist either negotiates the first check or

receives the first payment by electronic funds transfer of the

educational assistance elected.

(3) If a reservist is eligible to receive educational assistance

under both 38 U.S.C. chapter 30 and 10 U.S.C. chapter 1606, he or she

may receive educational assistance alternately or consecutively under

each of these chapters to the extent that the educational assistance is

based on service not irrevocably credited to one or the other chapter

as provided in paragraphs (c)(1) and (c)(2) of this section.

(Authority: 10 U.S.C. 16132; 38 U.S.C. 3033(c))

* * * * *

(d) * * *

(Authority: 10 U.S.C. 16132(d), 16134)

(The information collection requirements in this section have been

approved by the Office

[[Page 45719]]

of Management and Budget under control number 2900-0594)

[FR Doc. 98-22856 Filed 8-26-98; 8:45 am]

BILLING CODE 8320-01-P