STATEMENT OF
CELIA P. DOLLARHIDE
DIRECTOR, EDUCATION SERVICE
VETERANS BENEFITS ADMINISTRATION
DEPARTMENT OF VETERANS AFFAIRS
BEFORE THE
HOUSE COMMITTEE ON VETERANS' AFFAIRS
SUBCOMMITTEE ON BENEFITS

October 28, 1999

Mr. Chairman and Members of the Subcommittee, thank you for the opportunity to testify today on H.R. 625, a bill to authorize the Department of Veterans Affairs (VA) to continue payment of monthly educational assistance benefits to veterans enrolled at educational institutions during periods between terms if the interval between such periods does not exceed eight weeks. We also appreciate the opportunity to comment on certain draft legislative concepts under consideration to enhance VA educational assistance programs. Specifically, my testimony today will address proposals to: expand the work study program; simplify approval criteria for courses; allow service members to retain Montgomery G.I. Bill (MGIB) eligibility if they are discharged to receive a commission; and modify eligibility criteria for the Survivors' and Dependents' Educational Assistance (DEA) program. VA’s views on H.R. 625 and the concepts follow. With regard to all of them, however, let me note up front that the Administration cannot provide its position without first reviewing a specific legislative proposal and estimating its costs. Regarding those that would be subject to the pay-as-you-go (PAYGO) requirement of the Omnibus Budget Reconciliation Act of 1990, as you know, we would need to work with you to identify necessary offsets for proposals we were to support.

First, I would like to discuss our views on H.R. 625. As previously indicated, this measure would extend the length of the break between school terms for which VA could continue payment of monthly educational assistance benefits. Those individuals affected would have to be enrolled at educational institutions that certify enrollment on a term basis, and the school terms both preceding and following the break could not be shorter than the break period itself.

Current law allows VA to pay only for intervals between terms that do not exceed a full calendar month. The purpose for paying benefits during term breaks is to allow the student whose enrollment is essentially continuous to receive uninterrupted educational assistance from VA. This removes the necessity for the veteran to attempt to find employment to cover subsistence expenses during the interval. We recognize that veterans who receive benefits during a long interval will exhaust their entitlement at a faster rate and, accordingly, we do have some concern about this proposed extension. Nevertheless, we believe that veteran students will act responsibly and carefully consider this use of entitlement when making a decision to accept benefits during breaks in their school terms. Thus, subject to the PAYGO requirements of the Omnibus Budget Reconciliation Act of 1990, VA has no objection to this proposal. We estimate that this provision, if enacted, would result in additional budget costs of $2.45 million for Fiscal Year 2000 and $13.38 million over the period Fiscal Years 2000 through 2004.

Next, I would like to speak to the work-study expansion proposal. We hear from veterans and school officials alike that, with the ever increasing costs of education, some veterans have a real need for greater access to resources that can supplement their MGIB benefits.

Currently, VA work-study participants are limited by statute in the type of work they can perform. For instance, they may work at their educational institutions but are restricted to preparing and processing documentation for VA. While this limitation may have been needed when enacted, it now appears to be an impediment both to these veterans’ program participation and their provision of services to other veteran students. For some time now, demand for work-study jobs on campus has greatly exceeded the limited supply of positions available for engaging in purely VA paperwork activity. Further, a need exists for student services for veteran students that goes beyond merely processing VA education benefit paperwork. Veteran students may need help in finding and applying for other sources of supplemental financial aid, yet the law precludes VA work-study participants from furnishing assistance beyond that related to VA. This frustrates both the work-study participant and veteran students seeking help.

Mr. Chairman, we believe it is in keeping with the purposes of the VA work study program that veteran work-study students be provided this additional educational assistance allowance for performing services that do not merely narrowly relate to VA activities but that broadly help other veterans. Consequently, we would welcome consideration of a statutory amendment permitting VA work-study students to: assist veterans with all paperwork related to their participation in Federal programs; work at educational institutions in jobs related to their programs of education; work at State veterans institutions and nonprofit service organizations that provide community assistance and support to veterans and service members; and work at State Approving Agencies (SAAs). We note, however, that we would need to evaluate any specific legislation to determine any effects on other Federal work-study participants. Furthermore, these proposals would be subject to the PAYGO requirements of the Omnibus Budget Reconciliation Act of 1990. Because we have not had the opportunity to review any specific legislation, we do not yet have an estimate of the budget costs of such changes.

The next issue I would like to address is the proposal for simplified approval criteria for courses. The legislative initiative would permit educational institutions to obtain approval for their courses from the SAA based on meeting State licensing requirements, rather than the requirements listed in title 38, specifically 38 U.S.C. 3675 and 3676. The Secretary of Veterans Affairs would have to determine that the State requirements would result in courses of equal or better quality.

Since the G.I. Bill course approval provisions first became law, several States have introduced strict licensing requirements for educational institutions offering degree and/or non-degree programs. These requirements are similar, though not identical, to the approval requirements in title 38. As a result, educational institutions must comply with two essentially similar sets of rules, assuring, in the process, that they accommodate the slight variation in requirements.

It seems to us that enactment of this initiative would ease the paperwork and recordkeeping burden on schools. It would also make approval easier for those States in which the SAA and State licensing board both report to the same State official. (PAYGO provisions would not apply to this provision since it is cost neutral.)

The next initiative I want to discuss would allow service members to retain eligibility if they are discharged during their initial service period to receive a commission. We recognize that enlisted service members often are selected to attend Officer Training School or Officer Candidate School. Upon completion of these schools, they are discharged in order to accept an immediate commission as an officer. If the discharge occurs before completion of the minimum period of active duty needed to establish MGIB eligibility, the service member is ineligible for education benefits. This proposal would allow the two periods of active duty to be considered as one, thus, allowing these individuals to remain eligible for the MGIB program.

We believe the circumstances under which such individuals are discharged clearly are not comparable to those for which educational assistance is denied an individual who prematurely terminates an initial obligated period of service without meeting minimum qualifying service requirements and without any further active duty commitment. Rather, an individual's completion of Officer Candidate or Officer Training School and subsequent discharge to accept a commission further the military's interests and, in our view, are consistent with the nature and extent of active duty service for which MGIB benefits equitably should be allowed. Consequently, subject to the PAYGO requirements of the Omnibus Budget Reconciliation Act of 1990, we would support this initiative allowing retention of MGIB eligibility in such cases. To the extent that this proposal was consistent with the one in S. 1402, we estimate that it would result in budget costs of $137,000 in Fiscal Year 2000 and a total of $719,000 over the period Fiscal Years 2000—2004.

Finally, I would like to discuss the legislative initiative for modified eligibility criteria for the Survivors' and Dependents' Educational Assistance (DEA) program. This proposal would allow a veteran's claim for a 100 percent service-connected disability rating and a surviving spouse's claim for Dependency and Indemnity Compensation (DIC) to be considered a claim for DEA for the veteran's children.

It would appear the concern here is to propose an equitable solution for designating an appropriate effective date for awarding retroactive DEA benefits when there is significant administrative delay in establishing the criteria on which entitlement to such benefits are based.

This concern is illustrated by the case of a surviving spouse who files a claim for Dependency and Indemnity Compensation (DIC) and must wait more than a year for a final agency decision on service connection for the veteran's death. If it is decided that the veteran's death is service-connected, VA will generally award DIC benefits from the date the veteran died. When the child, however, subsequently seeks DEA benefits from the date of the veteran's death, he or she may be paid retroactively only for training pursued not more than 1 year before the date of the child's DEA claim. (38 U.S.C. § 5113).

As this Subcommittee indicates, the Court of Appeals for Veterans Claims has held that a child must file his or her DEA claim independent of the surviving spouse's DIC claim. Pfau v. West, 12 Vet.App. 515 (1999); Erspamer V. Brown, 9 Vet.App. 507 (1996). Therefore, when a child waits for disposition of the DIC claim before filing the DEA claim, he or she may not be able to receive payment for training undertaken in the interim. A parallel situation exists when the child wishes to claim DEA and the veteran's claim for disability compensation is unresolved. The DEA claim must be independent of the veteran's claim for a 100 percent service-connected disability rating.

We do not disagree with the court’s analysis of current law. Yet, we must acknowledge that a child seeking DEA assistance may be placed in a difficult position because the child’s claim of entitlement necessarily derives from the status of the veteran’s claim for permanent and total service-connected disability or the surviving spouse’s DIC claim. If VA has not decided or has denied the parent’s compensation or DIC claim due to failure to establish the requisite service connection, it may be too much to expect the child, nevertheless, to appreciate the need to file a timely claim in order to preserve his or her rights. Accordingly, we believe it is appropriate to consider amendatory legislation that would provide certain children a reasonable measure of relief in such circumstances.

We would suggest, however, that it be limited to children who reached age 18 and were in school while the claim for DIC or 100 percent service-connected disability rating was still pending. Any such proposal also would be subject to the PAYGO requirements of the Omnibus Budget Reconciliation Act of 1990. Although we have not yet had the opportunity to review any specific legislation, we would expect budget costs on the order of $1 million over the period Fiscal Years 2000—2004.

Mr. Chairman, that concludes my testimony. I would be pleased to reply to any questions you or Members of the Subcommittee may have.