SUPPLEMENTARY INFORMATION:

Per 38 U.S.C. 3100, one of the purposes of the VR&E program (also known as Chapter 31) is to provide services and assistance necessary to enable veterans with service-connected disabilities to obtain suitable employment. This may encompass training or retraining at a facility as part of a veteran's Chapter 31 vocational rehabilitation program. As provided in 38 U.S.C. 3684(a)(1), the veteran and the educational institution offering a course in which such veteran is enrolled under Chapter 31 “shall, without delay, report to the Secretary, in the form prescribed by the Secretary, such enrollment and any interruption or termination of the education of each such veteran.”

VA also pays veterans a subsistence allowance during the period of training. The purpose of the subsistence allowance is to assist with expenses related to the training. VA pays the ( printed page 72352) subsistence allowance after receiving the School Certifying Official's (SCO) certification of a Chapter 31 veteran's enrollment in a facility. The SCO certifies a veteran's rate of pursuit, dates of attendance, and the number of credit or training hours and informs VA when changes are made.

Currently, VR&E has no established timeframes for SCOs to initially certify and inform VA of changes made to a Chapter 31 veteran's rate of pursuit, dates of attendance, and the number of credit or training hours. The lack of an established timeframe contributes to unnecessary delays in the timely processing of monthly subsistence allowance payments to veterans who depend on these funds. Additionally, if a veteran increases, decreases, or terminates enrollment and the certification is not updated in a timely manner, the delay may create an undue hardship for the veteran if he or she is underpaid or overpaid. If a veteran is overpaid, VA must establish a debt against the veteran even though it may have been due to the SCO's delay in updating the certification. VA is proposing to revise 38 CFR 21.294 to describe what would constitute timely initial certification and timely reporting of changes to rate of pursuit, dates of attendance, and the number of credit or training hours for Chapter 31 veterans. Revised § 21.294(a)(4)(ii) would require SCOs to submit initial certifications to VA within 30 days of the beginning of the school term. See, e.g.,38 CFR 21.4203(d) (reporting requirements under VA's education program). SCOs would also be required to report changes in rate of pursuit, dates of attendance or the number of credit or training hours within 30 days of when a veteran makes such change. This amendment would help prevent underpayments and overpayments that may otherwise create unnecessary hardship for veterans. A veteran could request waiver of a debt, but such request would not be granted automatically. These changes would result in improved, timelier services to veterans.

Executive Orders 12866, 13563 and 14094

Executive Order 12866 (Regulatory Planning and Review) directs agencies to assess the costs and benefits of available regulatory alternatives and, when regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, and other advantages; distributive impacts; and equity). Executive Order 13563 (Improving Regulation and Regulatory Review) emphasizes the importance of quantifying both costs and benefits, reducing costs, harmonizing rules, and promoting flexibility. Executive Order 14094 (Executive Order on Modernizing Regulatory Review) supplements and reaffirms the principles, structures, and definitions governing contemporary regulatory review established in Executive Order 12866 of September 30, 1993 (Regulatory Planning and Review), and Executive Order 13563 of January 18, 2011 (Improving Regulation and Regulatory Review). The Office of Information and Regulatory Affairs has determined that this rulemaking is not a significant regulatory action under Executive Order 12866, as amended by Executive Order 14094. The Regulatory Impact Analysis associated with this rulemaking can be found as a supporting document at www.regulations.gov.

Regulatory Flexibility Act

The Secretary hereby certifies that this proposed rule would not have a 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). The factual basis for this certification is that the changes made by this rulemaking would require SCOs, which are currently required to submit certifications and reports to VA, to submit them in a timely manner, which would primarily impact the veteran participants. Any impact this rulemaking may have on facilities that may be considered small entities should be nominal because we would not be creating any additional obligations or burdens on the facilities. Therefore, pursuant to 5 U.S.C. 605(b), the initial and final regulatory flexibility analysis requirements of 5 U.S.C. 603 and 604 do not apply.

Unfunded Mandates

The Unfunded Mandates Reform Act of 1995 requires, at 2 U.S.C. 1532, that agencies prepare an assessment of anticipated costs and benefits before issuing any rule that may result in the expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $100 million or more (adjusted annually for inflation) in any one year. This proposed rule would have no such effect on State, local, and tribal governments, or on the private sector.

Paperwork Reduction Act

Although this proposed rule contains collections of information under the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3521), there are no provisions associated with this rulemaking constituting any new collection of information or any revisions to the current collections of information. The collections of information for 38 CFR 21.294 are currently approved by the Office of Management and Budget (OMB) and have valid OMB control numbers of 2900-0073 and 2900-0156.

Signing Authority

Denis McDonough, Secretary of Veterans Affairs, approved and signed this document on August 29, 2024, and authorized the undersigned to sign and submit the document to the Office of the Federal Register for publication electronically as an official document of the Department of Veterans Affairs.

For the reasons stated in the preamble, the Department of Veterans Affairs proposes to amend 38 CFR part 21 as set forth below:

1. The authority citation for part 21, subpart A, continues to read as follows:

Authority: 38 U.S.C. 501(a), chs. 18, 31, and as noted in specific sections.

2. Amend § 21.294 by revising paragraph (a)(4)(ii) to read as follows: