II Calendar No. 539 116TH CONGRESS 2D 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, Mrs. SHAHEEN, Ms. BALDWIN, and Ms. KLOBUCHAR) introduced the following bill; which was read twice and referred to the Committee on Veterans’ Affairs SEPTEMBER 15, 2020 Reported by Mr. MORAN, with an amendment [Strike out all after the enacting clause and insert the part printed in italic] 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 ac- VerDate Sep 11 2014 00:32 Sep 16, 2020 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6652 E:\BILLS\S805.RS S805 kjohnson on DSK79L0C42PROD with BILLS 2 •S 805 RS corded veterans with respect to such recovery, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Veteran Debt Fairness 4 Act of 2019’’. 5 SEC. 2. IMPROVING PROCESSING OF VETERANS BENEFITS 6 BY DEPARTMENT OF VETERANS AFFAIRS. 7 (a) NOTIFICATION OF DEBTS INCURRED.—The Sec- 8 retary of Veterans Affairs shall make such changes to such 9 information technology systems of the Department of Vet- 10 erans Affairs, including the eBenefits system or successor 11 system, as may be necessary so that a person who is enti- 12 tled to a payment from the Department by virtue of the 13 person’s participation in a benefits program administered 14 by the Secretary will receive, at the request of the person, 15 a notice from the Department through means selected by 16 the individual (by electronic mail or other mechanism) 17 whenever such person incurs a debt to the United States 18 by virtue of such participation. 19 (b) UPDATING DEPENDENT INFORMATION.—The 20 Secretary shall make such changes to such information 21 technology systems of the Department, including the 22 eBenefits system or successor system, as may be necessary 23 so that whenever the Secretary records in such systems 24 VerDate Sep 11 2014 00:32 Sep 16, 2020 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6401 E:\BILLS\S805.RS S805 kjohnson on DSK79L0C42PROD with BILLS 3 •S 805 RS information about a dependent of a person, the person is 1 able to review and revise such information. 2 (c) TRACKING OF METRICS.—The Secretary shall 3 make such changes to such information technology sys- 4 tems of the Department as may be necessary to track the 5 following: 6 (1) The number and amount of payments made 7 by the Department to persons as part of a benefits 8 program administered by the Secretary which result 9 in the persons incurring a debt to the United States 10 by virtue of such payments. 11 (2) The average debt to the United States in- 12 curred by a person by virtue of a payment described 13 in paragraph (1). 14 (3) The frequency by which applications for re- 15 lief under section 5302(a) of title 38, United States 16 Code, are approved and denied. 17 (4) Such other metrics as the Secretary con- 18 siders appropriate. 19 SEC. 3. REFORMS RELATING TO RECOVERY BY DEPART- 20 MENT OF VETERANS AFFAIRS OF AMOUNTS 21 OWED BY VETERANS TO THE UNITED STATES. 22 (a) INDEBTEDNESS OFFSETS.— 23 VerDate Sep 11 2014 00:32 Sep 16, 2020 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6401 E:\BILLS\S805.RS S805 kjohnson on DSK79L0C42PROD with BILLS 4 •S 805 RS (1) LIMITATION ON SCOPE OF AUTHORITY.— 1 Subsection (a) of section 5314 of title 38, United 2 States Code, is amended— 3 (A) by inserting ‘‘(1)’’ before ‘‘Subject to’’; 4 (B) in paragraph (1), as designated by 5 subparagraph (A), by striking ‘‘to subsections 6 (b) and (d) of this section’’ and inserting ‘‘to 7 paragraphs (2) through (6) of this subsection, 8 subsections (b) and (e) of this section,’’; and 9 (C) by adding at the end the following new 10 paragraph: 11 ‘‘(2) Notwithstanding any other provision of law, the 12 Secretary may only deduct under paragraph (1) an 13 amount of the indebtedness of a veteran, the estate of a 14 veteran, a spouse or child of a veteran who is deceased, 15 or a recipient of educational assistance under chapter 30, 16 31, 32, 33, 34, or 35 of this title if the indebtedness is 17 a result of one or more of the following: 18 ‘‘(A) An error made by or failure to report re- 19 quired information to the Department by the vet- 20 eran, estate, spouse, child, or recipient of edu- 21 cational assistance, as the case may be. 22 ‘‘(B) Fraud perpetrated by the veteran, estate, 23 spouse, child, or recipient of educational assistance, 24 as the case may be. 25 VerDate Sep 11 2014 00:32 Sep 16, 2020 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6401 E:\BILLS\S805.RS S805 kjohnson on DSK79L0C42PROD with BILLS 5 •S 805 RS ‘‘(C) A misrepresentation made by the veteran, 1 estate, spouse, child, or recipient of educational as- 2 sistance, as the case may be. 3 ‘‘(D) In the case of a recipient of educational 4 assistance under such chapters, a reduction in or 5 termination of pursuit of a program of education by 6 the recipient. 7 ‘‘(E) A failure described in section 8 3319(i)(2)(A) of this title. 9 ‘‘(3)(A) The Secretary may not deduct under para- 10 graph (1) from any payment made under chapter 11 or 11 15 of this title more than the lessor of— 12 ‘‘(i) 25 percent of such payment; or 13 ‘‘(ii) such other percent of such payment as the 14 Secretary and the person whose future payments are 15 to be reduced under paragraph (1) agree would not 16 cause a hardship to the person of the payment. 17 ‘‘(B) A person whose future payments are to be re- 18 duced under paragraph (1) may request, via the adminis- 19 trative process prescribed under subsection (c), the Sec- 20 retary make a determination under subparagraph (A)(ii) 21 of this paragraph. 22 ‘‘(4) In the case of an indebtedness that was incurred 23 as a result of an error or failure described in paragraph 24 (2)(A), the Secretary may not deduct under paragraph (1) 25 VerDate Sep 11 2014 00:32 Sep 16, 2020 Jkt 099200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6401 E:\BILLS\S805.RS S805 kjohnson on DSK79L0C42PROD with BILLS 6 •S 805 RS any amount relating to such indebtedness after the date 1 that is five years after the date on which the debt was 2 incurred. 3 ‘‘(5) The Secretary may not deduct under paragraph 4 (1) any amount relating to an indebtedness while the ex- 5 istence or amount of such indebtedness is being— 6 ‘‘(A) disputed under subsection (c); or 7 ‘‘(B) appealed. 8 ‘‘(6) The Secretary may not deduct under paragraph 9 (1) any amount if the Secretary determines that the cost 10 that would be incurred by the Department to recover such 11 amount would exceed the amount to be recovered. 12 ‘‘(7) Paragraphs (2) through (6) shall not apply to 13 payments under chapter 19 of this title.’’. 14 (2) DUE PROCESS.— 15 (A) MINIMUM PERIOD FOR NOTICE.—Sub- 16 section (b) of such section is amended— 17 (i) by amending paragraph (1) to read 18 as follows: 19 ‘‘(1) has made reasonable efforts to notify such 20 person of such person’s right— 21 ‘‘(A) to dispute through prescribed admin- 22 istrative processes the existence or amount of 23 such indebtedness; 24 VerDate Sep 11 2014 00:32 Sep 16, 2020 Jkt 099200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6401 E:\BILLS\S805.RS S805 kjohnson on DSK79L0C42PROD with BILLS 7 •S 805 RS ‘‘(B) to request a waiver of such indebted- 1 ness under section 5302 of this title; and 2 ‘‘(C) to request the Secretary make a de- 3 termination under subsection (a)(3)(A)(ii);’’; 4 and 5 (ii) by striking paragraph (3) and in- 6 serting the following new paragraphs: 7 ‘‘(3) has notified such person about the pro- 8 posed deductions by mailing a notice of intent letter, 9 which— 10 ‘‘(A) is mailed to the person— 11 ‘‘(i) in the case of a debt incurred by 12 a person by virtue of the person’s partici- 13 pation in a program of educational assist- 14 ance administered by the Secretary, not 15 later than 45 days before making any of 16 such deductions; and 17 ‘‘(ii) in the case of a debt incurred by 18 a person by virtue of the person’s partici- 19 pation in any other benefit program ad- 20 ministered by the Secretary, not later than 21 90 days before making any of such deduc- 22 tions; and 23 ‘‘(B) includes detailed information about 24 the indebtedness, including, in the case of an 25 VerDate Sep 11 2014 00:32 Sep 16, 2020 Jkt 099200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6401 E:\BILLS\S805.RS S805 kjohnson on DSK79L0C42PROD with BILLS 8 •S 805 RS overpayment, an itemized list of each overpay- 1 ment and the specific reason for the overpay- 2 ment.’’. 3 (B) ADJUDICATION OF DISPUTES.— 4 (i) IN GENERAL.—Such section is 5 amended— 6 (I) by redesignating subsections 7 (c) and (d) as subsections (d) and (e); 8 and 9 (II) by inserting after subsection 10 (b) the following new subsection (c): 11 ‘‘(c)(1) The Secretary shall prescribe an administra- 12 tive process for— 13 ‘‘(A) the dispute of the existence or amount of 14 an indebtedness subject to subsection (a); and 15 ‘‘(B) making requests under paragraph (3)(B) 16 of such subsection. 17 ‘‘(2) The Secretary shall ensure that each dispute 18 under paragraph (1)(A) is adjudicated not later than 120 19 days after the dispute is filed. 20 ‘‘(3) The Secretary may not submit to any debt col- 21 lector (as defined in section 803 of the Fair Debt Collec- 22 tion Practices Act (15 U.S.C. 1692a)) any debt pending 23 adjudication under the process prescribed under para- 24 graph (1). 25 VerDate Sep 11 2014 00:32 Sep 16, 2020 Jkt 099200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6401 E:\BILLS\S805.RS S805 kjohnson on DSK79L0C42PROD with BILLS 9 •S 805 RS ‘‘(4) Nothing in this subsection shall be construed to 1 prohibit a person from seeking relief from a court of com- 2 petent jurisdiction.’’. 3 (ii) LIMITATIONS ON INTEREST AND 4 FEES CHARGED DURING PERIOD OF DIS- 5 PUTE.—Section 5315 of such title is 6 amended— 7 (I) in subsection (b)(1), in the 8 first sentence by striking ‘‘or (B)’’ 9 and inserting ‘‘(B) for any period dur- 10 ing which the existence or amount of 11 the indebtedness is being disputed 12 under section 5314(c) of this title, or 13 (C)’’; and 14 (II) in subsection (c)— 15 (aa) by inserting ‘‘(1)’’ be- 16 fore ‘‘The administrative’’; and 17 (bb) by adding at the end 18 the following new paragraph: 19 ‘‘(2) No administrative costs may be charged under 20 this section with respect to an indebtedness described in 21 subsection (a) while the existence or amount of the indebt- 22 edness is being disputed under section 5314(c) of this 23 title.’’. 24 VerDate Sep 11 2014 00:32 Sep 16, 2020 Jkt 099200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6401 E:\BILLS\S805.RS S805 kjohnson on DSK79L0C42PROD with BILLS 10 •S 805 RS (3) EFFECTIVE DATE.—This subsection and the 1 amendments made by this subsection shall take ef- 2 fect on the date of the enactment of this Act and 3 shall apply with respect to deductions made under 4 section 5314 of such title on or after such date. 5 (4) RULE OF CONSTRUCTION.—This subsection 6 and the amendments made by this subsection shall 7 be construed to apply to an error in a payment to 8 a person from the Department of Veterans Affairs 9 the person is entitled to by virtue of the person’s 10 participation in a benefits program administered by 11 the Secretary of Veterans Affairs following the per- 12 son’s notice to the Department of a change in the 13 person’s eligibility regarding such benefit or partici- 14 pation. 15 (b) LIMITATION ON AUTHORITY TO SUE TO COL- 16 LECT CERTAIN DEBTS.— 17 (1) IN GENERAL.—Section 5316(a) of such title 18 is amended— 19 (A) in paragraph (1), by striking ‘‘(2) and 20 (3)’’ and inserting ‘‘(2), (3), and (4)’’; 21 (B) by redesignating paragraph (3) as 22 paragraph (4); and 23 (C) by inserting after paragraph (2) the 24 following new paragraph (3): 25 VerDate Sep 11 2014 00:32 Sep 16, 2020 Jkt 099200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6401 E:\BILLS\S805.RS S805 kjohnson on DSK79L0C42PROD with BILLS 11 •S 805 RS ‘‘(3) In the case of an indebtedness that was incurred 1 as a result or an error or failure described in section 2 5314(a)(2)(A) of this title, no suit may be filed under this 3 section to recover the indebtedness after the date that is 4 five years after the date on which the debt was incurred.’’. 5 (2) EFFECTIVE DATE.—This subsection and the 6 amendments made by this subsection shall take ef- 7 fect on the date of the enactment of this Act and 8 shall apply with respect to suits filed under section 9 5316 of such title on or after such date. 10 (c) LIMITATION ON COOPERATION WITH OTHER 11 FEDERAL AGENCIES TO COLLECT.—Section 5316 of such 12 title is amended by adding at the end the following new 13 subsection: 14 ‘‘(d) The Secretary may not provide any information 15 or assistance to any other element of the Federal Govern- 16 ment to recover, whether by bringing suit in a court of 17 competent jurisdiction, by deducting amounts from future 18 payments, or by other method, any indebtedness of any 19 person who has been determined to be indebted to the 20 United States by virtue of such person’s participation in 21 a benefits program administered by the Secretary if the 22 Secretary does not have the authority to recover such in- 23 debtedness under this title.’’. 24 (d) REPAIR OF CREDIT.— 25 VerDate Sep 11 2014 00:32 Sep 16, 2020 Jkt 099200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6401 E:\BILLS\S805.RS S805 kjohnson on DSK79L0C42PROD with BILLS 12 •S 805 RS (1) IN GENERAL.—Chapter 53 of such title is 1 amended by adding at the end the following new sec- 2 tion: 3 ‘‘§ 5320. Correction of erroneous information sub- 4 mitted to consumer reporting agencies 5 ‘‘(a) CORRECTING ERRORS BY THE DEPARTMENT.— 6 In any case in which the Secretary finds that the Depart- 7 ment has submitted erroneous information to a consumer 8 reporting agency about the indebtedness of any person 9 who has been determined by the Secretary to be indebted 10 to the United States by virtue of such person’s participa- 11 tion in a benefits program administered by the Secretary, 12 the Secr [Text truncated for display. Full text available on Congress.gov.]