Burial Benefits, 19021-19034 [E8-7234]

Agencies

• DEPARTMENT OF VETERANS AFFAIRS

[Federal Register Volume 73, Number 68 (Tuesday, April 8, 2008)]
[Proposed Rules]
[Pages 19021-19034]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-7234]


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DEPARTMENT OF VETERANS AFFAIRS

38 CFR Part 5

RIN 2900-AL72


Burial Benefits

AGENCY: Department of Veterans Affairs.

ACTION: Proposed rule.

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SUMMARY: The Department of Veterans Affairs (VA) proposes to reorganize 
and rewrite in plain language provisions applicable to burial benefits. 
These revisions are proposed as part of VA's rewrite and reorganization 
of all of its compensation and pension rules in a logical, claimant-
focused, and user-friendly format. The intended effect of the proposed 
revisions is to assist claimants, beneficiaries, and VA personnel in 
locating and understanding these regulations regarding burial benefits.

DATES: Comments must be received by VA on or before June 9, 2008.

ADDRESSES: Written comments may be submitted through https://
www.Regulations.gov; by mail or hand-delivery to: Director, Regulations 
Management (00REG), Department of Veterans Affairs, 810 Vermont Ave., 
NW., Room 1068, Washington, DC 20420; or by fax to (202) 273-9026 (not 
a toll free number). Comments should indicate that they are submitted 
in response to ``RIN 2900-AL72--Burial Benefits.'' Copies of comments 
received will be available for public inspection in the Office of 
Regulation Policy and Management, Room 1063B, between the hours of 8 
a.m. and 4:30 p.m., Monday through Friday (except holidays). Please 
call (202) 461-4902 for an appointment (not a toll free number). In 
addition, during the comment period, comments may be viewed online 
through the Federal Docket Management System (FDMS) at https://
www.Regulations.gov.

FOR FURTHER INFORMATION CONTACT: William F. Russo, Director of 
Regulations Management (00REG), Department of Veterans Affairs, 810 
Vermont Avenue, NW., Washington, DC 20420, (202) 461-4902 (not a toll 
free number).

SUPPLEMENTARY INFORMATION: The Secretary of Veterans Affairs has 
established an Office of Regulation Policy and Management to provide 
centralized management and coordination of VA's rulemaking process. One 
of the major functions of this office is to oversee a Regulation 
Rewrite Project (the Project) to improve the clarity and consistency of 
existing VA regulations. The Project responds to a recommendation made 
in the October 2001 ``VA Claims Processing Task Force: Report to the 
Secretary of Veterans Affairs.'' The Task Force recommended that the 
compensation and pension regulations be rewritten and reorganized in 
order to improve VA's claims adjudication process. Therefore, the 
Project began its efforts by reviewing, reorganizing, and redrafting 
the content of the regulations in 38 CFR part 3 governing the 
compensation and pension program of the Veterans Benefits 
Administration. These regulations are among the most difficult VA 
regulations for readers to understand and apply.
    Once rewritten, the proposed regulations will be published in 
several portions for public review and comment. This is one such 
portion. It includes proposed rules regarding burial benefits. After 
review and consideration of public comments, final versions of these 
proposed regulations will ultimately be published in a new part 5 in 38 
CFR.

Outline

Overview of New Part 5 Organization
Overview of Proposed Subpart J Organization
Table Comparing Current Part 3 Rules with Proposed Part 5 Rules
Content of Proposed Regulations
    Section 5.630 Types of VA burial benefits
    Section 5.631 Deceased veterans for whom VA may provide burial 
benefits
    Section 5.632 Persons who may receive burial benefits
    Section 5.633 Claims
    Section 5.634 Reimbursable burial expenses--General
    Section 5.635 Reimbursable transportation expenses for veterans 
who are buried in a national cemetery or who died while hospitalized 
by VA
    Section 5.636 Burial of veterans whose remains are unclaimed
    Section 5.638 Burial allowance based on service-connected death
    Section 5.639 Transportation expenses for burial in a national 
cemetery
    Section 5.643 Burial allowance based on nonservice-connected 
death
    Section 5.644 Burial allowance for veterans who died while 
hospitalized by VA
    Section 5.645 Plot or interment allowance
    Section 5.649 Priority of payments when there is more than one 
claimant
    Section 5.650 Escheat (payment of burial benefits to an estate 
with no heirs)
    Section 5.651 Effect of contributions by government, public, or 
private organizations
    Section 5.652 Effect of forfeiture on payment of burial benefits
    Section 5.653 Eligibility based on status before 1958
Endnote Regarding Amendatory Language
Paperwork Reduction Act of 1995
Regulatory Flexibility Act
Executive Order 12866
Unfunded Mandates
Catalog of Federal Domestic Assistance Numbers and Titles
List of Subjects in 38 CFR Part 5

Overview of New Part 5 Organization

    We plan to organize the new part 5 regulations so that most 
provisions governing a specific benefit are located in the same 
subpart, with general provisions pertaining to all compensation and 
pension benefits also grouped together. This organization will allow 
claimants, beneficiaries, and their representatives, as well as VA 
adjudicators, to find information relating to a specific benefit more 
quickly than the organization provided in current part 3.
    The first major subdivision would be ``Subpart A--General 
Provisions.'' It would include information regarding the scope of the 
regulations in new part 5, general definitions, and general policy 
provisions for this part. This subpart was published as proposed on 
March 31, 2006. See 71 FR 16464.
    ``Subpart B--Service Requirements for Veterans'' would include 
information regarding a veteran's military service, including the 
minimum service requirement, types of service, periods of war, and 
service evidence requirements. This subpart was published as proposed 
on January 30, 2004. See 69 FR 4820.
    ``Subpart C--Adjudicative Process, General'' would inform readers 
about claims and benefit application filing procedures, VA's duties, 
rights and responsibilities of claimants and beneficiaries, general 
evidence requirements, and general effective dates for new awards, as 
well as

[[Page 19022]]

revision of decisions and protection of VA ratings. This subpart will 
be published as three separate Notices of Proposed Rulemaking (NPRMs) 
due to its size. The first, concerning the duties of VA and the rights 
and responsibilities of claimants and beneficiaries, was published as 
proposed on May 10, 2005. See 70 FR 24680. The second, covering general 
evidence requirements, effective dates for awards, revision of 
decisions, and protection of VA ratings, was published as proposed on 
May 22, 2007. See 72 FR 28770.
    ``Subpart D--Dependents and Survivors'' would inform readers how VA 
determines whether an individual is a dependent or a survivor for 
purposes of determining eligibility for VA benefits. It would also 
provide the evidence requirements for these determinations. This 
subpart was published as proposed on September 20, 2006. See 71 FR 
55052.
    ``Subpart E--Claims for Service Connection and Disability 
Compensation'' would define service-connected disability compensation 
and service connection, including direct and secondary service 
connection. This subpart would inform readers how VA determines service 
connection and entitlement to disability compensation. The subpart 
would also contain those provisions governing presumptions related to 
service connection, rating principles, and effective dates, as well as 
several special ratings. This subpart will be published as three 
separate NPRMs due to its size. The first, concerning presumptions 
related to service connection, was published as proposed on July 27, 
2004. See 69 FR 44614.
    ``Subpart F--Nonservice-Connected Disability Pensions and Death 
Pensions'' would include information regarding the three types of 
nonservice-connected pension: Old-Law Pension, Section 306 Pension, and 
Improved Pension. This subpart would also include those provisions that 
state how to establish entitlement to Improved Pension and the 
effective dates governing each pension. This subpart was published as 
two separate NPRMs due to its size. The portion concerning Old-Law 
Pension, Section 306 Pension, and elections of Improved Pension was 
published as proposed on December 27, 2004. See 69 FR 77578. The 
portion concerning eligibility and entitlement requirements, as well as 
effective dates for Improved Pension was published as proposed on 
September 26, 2007. See 72 FR 54776.
    ``Subpart G--Dependency and Indemnity Compensation, Death 
Compensation, Accrued Benefits, and Special Rules Applicable Upon Death 
of a Beneficiary'' would contain regulations governing claims for 
dependency and indemnity compensation (DIC); death compensation; 
accrued benefits; benefits awarded, but unpaid at death; and various 
special rules that apply to the disposition of VA benefits, or proceeds 
of VA benefits, when a beneficiary dies. This subpart would also 
include related definitions, effective-date rules, and rate-of-payment 
rules. This subpart was published as two separate NPRMs due to its 
size. The portion concerning accrued benefits, death compensation, 
special rules applicable upon the death of a beneficiary, and several 
effective-date rules, was published as proposed on October 1, 2004. See 
69 FR 59072. The portion concerning DIC benefits and general provisions 
relating to proof of death and service-connected cause of death was 
published as proposed on October 21, 2005. See 70 FR 61326.
    ``Subpart H--Special and Ancillary Benefits for Veterans, 
Dependents, and Survivors'' would pertain to special and ancillary 
benefits available, including benefits for children with various birth 
defects. This subpart was published as proposed on March 9, 2007. See 
72 FR 10860.
    ``Subpart I--Benefits for Certain Filipino Veterans and Survivors'' 
would pertain to the various benefits available to Filipino veterans 
and their survivors. This subpart was published as proposed on June 30, 
2006. See 71 FR 37790.
    ``Subpart J--Burial Benefits'' would pertain to burial allowances. 
This subpart is the subject of this document.
    ``Subpart K--Matters Affecting the Receipt of Benefits'' would 
contain provisions regarding bars to benefits, forfeiture of benefits, 
and renouncement of benefits. This subpart was published as proposed on 
May 31, 2006. See 71 FR 31056.
    ``Subpart L--Payments and Adjustments to Payments'' would include 
general rate-setting rules, several adjustment and resumption 
regulations, and election-of-benefit rules. Because of its size, 
proposed regulations in subpart L will be published in two separate 
NPRMs. The first, concerning payments to beneficiaries who are eligible 
for more than one benefit, was published as proposed on October 2, 
2007. See 72 FR 56136.
    The final subpart, ``Subpart M--Apportionments to Dependents and 
Payments to Fiduciaries and Incarcerated Beneficiaries,'' would include 
regulations governing apportionments, benefits for incarcerated 
beneficiaries, and guardianship.
    Some of the regulations in this NPRM cross-reference other 
compensation and pension regulations. If those regulations have been 
published in this or earlier NPRMs for the Project, we cite the 
proposed part 5 section. We also include, in the relevant portion of 
the Supplementary Information, the Federal Register page where a 
proposed part 5 section published in an earlier NPRM may be found. 
However, where a regulation proposed in this NPRM would cross-reference 
a proposed part 5 regulation that has not yet been published, we cite 
to the current part 3 regulation that deals with the same subject 
matter. The current part 3 section we cite may differ from its eventual 
part 5 counterpart in some respects, but this method will assist 
readers in understanding these proposed regulations where no part 5 
counterpart has yet been published. If there is no part 3 counterpart 
to a proposed part 5 regulation that has not yet been published, we 
have inserted ``[regulation that will be published in a future Notice 
of Proposed Rulemaking]'' where the part 5 regulation citation would be 
placed.
    Because of its large size, proposed part 5 will be published in a 
number of NPRMs, such as this one. VA will not adopt any portion of 
part 5 as final until all of the NPRMs have been published for public 
comment.
    In connection with this rulemaking, VA will accept comments 
relating to a prior rulemaking issued as a part of the Project, if the 
matter being commented on relates to both rulemakings.

Overview of Proposed Subpart J Organization

    This NPRM pertains to burial benefits. These regulations would be 
contained in proposed Subpart J of new 38 CFR part 5. Although these 
regulations have been substantially restructured and rewritten for 
greater clarity and ease of use, most of the basic concepts contained 
in these proposed regulations are the same as in their existing 
counterparts in 38 CFR part 3. However, a few substantive differences 
are proposed, as are some regulations that do not have counterparts in 
38 CFR part 3.

Table Comparing Current Part 3 Rules With Proposed Part 5 Rules

    The following table shows the relationship between the current 
regulations in part 3 and the proposed regulations contained in this 
NPRM:

[[Page 19023]]



------------------------------------------------------------------------
                                         Based in whole or in part on 38
 Proposed part 5 section or  paragraph   CFR part 3 section or paragraph
                                                   (or ``New'')
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5.630..................................  New
5.631(a)(1), (2).......................  3.1600 [first sentence]
5.631(a)(3)............................  New
5.631(b)...............................  3.1600 [second sentence]
5.631(c)...............................  3.1600(d)
5.632..................................  3.1601(a)(1) and (2)
5.633(a)...............................  3.1601(a)
5.633(b)(1)............................  3.1601(b)
5.633(b)(2)............................  3.203(c) [second sentence]
5.634(a)...............................  New
5.634(b)(1)............................  3.1607
5.634(b)(2), (3).......................  3.1608
5.635..................................  3.1606
5.636..................................  3.1600(b)(3), 3.1601(b)(5),
                                          3.1603, 3.1610(b)
5.638(a)...............................  3.1600(a)
5.638(b)...............................  New
5.638(c)(1)............................  3.1600(g)
5.638(c)(2)............................  New
5.639(a) and (b).......................  3.1600(g)
5.639(c)...............................  New
5.643..................................  3.1600(b)(1), (2), and (4)
5.644(a)...............................  3.1600(c); 3.1605 (intro
                                          paragraph)
5.644(b)(1)-(4)........................  3.1600(c)
5.644(b)(5)............................  3.1605(a)
5.644(b)(6)............................  3.1605(d)
5.644(c)...............................  3.1605(a)
5.644(d)...............................  3.1605(b)
5.645(a)...............................  3.1604(d)(1)(i) through (iv)
                                          and (d)(3)
5.645(b)...............................  3.1600(f)
5.645(c)...............................  3.1601(a)(3)
5.649(a)...............................  3.1602(b); 3.1604(d)(4)
5.649(b)...............................  3.1602(a)
5.649(c)...............................  3.1602(c)
5.649(d)...............................  3.1601(a)(2)(iii) [second and
                                          third sentences]
5.649(e)...............................  3.1601(a)
5.650..................................  3.1602(d)
5.651(a), (b)..........................  3.1604(a) and (c); 3.1604(a)(2)
5.651(c)(1)............................  3.1604(b)(1) and (2)
5.651(c)(2)............................  3.1604(b)(3)
5.651(c)(3)............................  New
5.651(d)...............................  3.1604(a)(1)
5.652..................................  3.1609
5.653..................................  3.954
------------------------------------------------------------------------

    Readers who use this table to compare existing regulatory 
provisions with the proposed provisions, and who observe a substantive 
difference between them, should consult the text that appears later in 
this document for an explanation of significant changes in each 
regulation. Not every paragraph of every current part 3 section 
regarding the subject matter of this rulemaking is accounted for in the 
table. In some instances, other portions of the part 3 sections that 
are addressed in these proposed regulations will appear in subparts of 
part 5 that are being published separately for public comment. For 
example, a reader might find a reference to paragraph (a) of a part 3 
section in the table, but no reference to paragraph (b) of that section 
because paragraph (b) will be addressed in a separate NPRM. The table 
also does not include provisions from part 3 regulations that will not 
be repeated in part 5. Such provisions are discussed specifically under 
the appropriate part 5 heading in this preamble. Readers are invited to 
comment on the proposed part 5 provisions and also on our proposals to 
omit those part 3 provisions from part 5.

Content of Proposed Regulations

Generally Applicable Provisions

Section 5.630 Types of VA Burial Benefits
    In order to give the public a general overview of the burial 
benefits VA provides, we propose to add Sec.  5.630. This section lists 
each type of burial benefit described in this proposed rule and also 
those VA burial benefits described in other statutes or VA regulations.
Section 5.631 Deceased Veterans for Whom VA May Provide Burial Benefits
    Proposed Sec.  5.631, would set forth requirements as to the 
service of the deceased person for whom VA May provide monetary burial 
benefits.
    Proposed paragraph (a) would define ``veteran'' for purposes of 
eligibility for monetary burial benefits as including a person who met 
one of three criteria. The first is, ``[h]ad active military service,'' 
the definition contained in the first paragraph of proposed Sec.  5.1, 
``General definitions.'' See 71 FR 16464, 16474 (Mar. 31, 2006). We 
believe this definition is consistent with congressional intent that 
the definition of veteran contained in 38 U.S.C. 101(2) should apply to 
burial benefit claims under 38 U.S.C. chapter 23. The second is, 
``[d]ied during authorized travel to or from a period of active duty 
under Sec.  5.29(a)(1),'' and is based on the introductory paragraph of 
current 38 CFR 3.1600. (Section 5.29(a)(1) is the part 5 counterpart to 
current Sec.  3.6(b)(6) and was published as proposed on January 30, 
2004. See 69 FR 4820, 4837.) The third is, ``entitled to a burial 
benefit based on a specific provision of law.'' An example of such a 
specific provision would be 46 U.S.C. 11201(a) (providing entitlement 
to burial allowance to Merchant Mariners who served between August 16, 
1945, and December 31, 1946, who meet the requirements of 46 U.S.C. 
11201-11204).
    In describing deceased veterans upon whom a claimant may base a 
claim for burial benefits, we propose not to include current Sec.  
3.1600(e), which begins, ``Except as provided in Sec.  3.1605(c) burial 
allowance is not payable in the following cases,'' and then lists five 
classes of individuals. Other part 5 regulations explaining the 
requirements for recognition as a veteran would establish whether the 
listed persons are eligible for burial benefits. Accordingly, 
reiterating those classes of individuals in proposed Sec.  5.631 is 
unnecessary and could be misleading in that it would be only a partial 
list of ineligible persons. The exceptions stated in current Sec.  
3.1605(c) are discussed below with regard to proposed Sec.  5.644.
    Proposed paragraphs (b) and (c) are consistent with the second 
sentence of the introductory paragraph of current Sec.  3.1600 and with 
Sec.  3.1600(d), respectively. Proposed paragraph (c) differs from the 
current rule in that under the proposed rule, VA is not bound by a 
service department holding that a deceased veteran's disability was not 
incurred in line of duty when ``VA receives evidence that permits a 
different finding.'' Under current Sec.  3.1600(d), VA is similarly not 
bound when VA receives such evidence; however, Sec.  3.1600(d) refers 
to evidence being ``submitted.'' We would use the word ``receives'' in 
the proposed regulation because VA may rely on evidence that we obtain 
through means other than submission by a claimant or third party.
Section 5.632 Persons Who May Receive Burial Benefits
    Proposed Sec.  5.632 would describe in plain language those 
individuals to whom VA may pay monetary burial benefits. The regulation 
would begin by stating the general principle that VA may grant a claim 
for burial benefits filed by any individual for a burial expense 
reimbursable by VA under this subpart, up to the amount of the 
applicable statutory burial allowance. The part 3 burial regulations do 
not explicitly state this rule, but the principle is implicit therein 
and this rule reflects VA's actual practice.
    The remainder of proposed Sec.  5.632 is based on current Sec.  
3.1601(a)(1) and (2). The proposed language would not repeat redundant 
language used in the current rule, but does not contain any substantive 
change from current VA rules or practices.
Section 5.633 Claims
    Proposed Sec.  5.633(a) clearly states the time limits mandated by 
statute for filing claims for burial benefits. Under 38 U.S.C. 2304, 
``[a]pplications for payments under section 2302 of [title

[[Page 19024]]

38, United States Code,] must be filed within 2 years after the burial 
of the veteran.'' Section 2302 provides authority for VA to pay the 
nonservice-connected burial allowance. Notwithstanding that there are 
no other time limitations contained within title 38, United States 
Code, on filing claims for burial benefits, the first sentence of 
current Sec.  3.1601(a) applies a two-year time limit to ``[c]laims for 
reimbursement or direct payment of burial and funeral expenses under 
Sec.  3.1600(b) [the nonservice-connected burial allowance] and plot or 
interment allowance under Sec.  3.1600(f).'' Similarly, the second and 
third sentences of current Sec.  3.1604(d)(2) specify a two-year time 
limit for claims for the plot or interment allowance under Sec.  
3.1604(d). The plot or interment allowance is authorized by 38 U.S.C. 
2303(b), and therefore the statutory two-year time limit does not apply 
to the plot or interment allowance. In proposed part 5, we would apply 
only the statutory time limitation. The proposed rule would also 
clarify that no other time limitations apply to claims for burial 
benefits under this subpart.
    Proposed Sec.  5.633(b)(1) describes the evidence that is needed to 
substantiate a claim for burial benefits. Paragraph (b) contains the 
following substantive differences from the current regulations upon 
which it is based.
    Proposed paragraph (b)(1) would require that VA ``receive'' the 
evidence described, whereas current Sec.  3.1601(b) requires that the 
claimant ``submit'' such evidence. The proposed language recognizes 
that VA may obtain relevant evidence on its own initiative and mirrors 
the language of the authorizing statute. See 38 U.S.C. 2304 (VA must 
deny claim ``[i]f such evidence is not received within 1 year from the 
date'' VA notifies claimant that application is incomplete).
    Proposed paragraph (b)(1)(ii) would require proof of death ``in 
accordance with Sec.  5.500,'' whereas current Sec.  3.1601(b)(3) 
requires proof of death ``in accordance with Sec.  3.211.'' In part 5, 
Sec.  5.500 would contain the rule set forth at Sec.  3.211. See 70 FR 
61326, 61341 (Oct. 21, 2005).
    Current Sec.  3.1601(b)(1) requires claimants to provide a 
``[s]tatement of account'' showing, ``[the] name of the deceased 
veteran, the plot or interment costs, and the nature and cost of 
services rendered, and unpaid balance.'' In proposed paragraph 
(b)(1)(iii), we propose to add ``any credits or payments received'' to 
this list because if expenses were paid, partially or entirely, by 
someone other than the claimant, that would affect the amount of 
entitlement to VA burial benefits.
    Proposed paragraph (b)(1)(iv) would allow claimants to provide a 
receipt showing payment to a representative of the funeral director 
and/or cemetery owner, as permitted by current Sec.  3.1601(b)(2), or 
directly to the funeral director and/or cemetery owner. The proposed 
addition reflects long-standing VA practice and recognizes the fact 
that payments are sometimes made directly to the funeral director and/
or cemetery owner. Additionally, paragraph (b)(1)(iv) would state that 
receipts for transportation charges must also show the dates of the 
services rendered, the name of the deceased veteran who was 
transported, and the name of the person who paid the transportation 
charges. This detail is added because VA needs such information in 
order to ensure accuracy in its adjudication of claims for 
reimbursement of transportation charges.
    Proposed paragraph (b)(2) is derived from the second sentence of 
current Sec.  3.203(c), which states that in a claim for nonservice-
connected benefits, evidence of service that VA relied upon to award 
compensation or pension during a veteran's lifetime will be sufficient 
to prove military service, unless there is some other evidence which 
creates doubt as to the correctness of that evidence of service.
Section 5.634 Reimbursable Burial Expenses--General
    Burial expenses and funeral expenses are factually distinct 
categories. The relevant statutes treat burial expenses and funeral 
expenses the same for purposes of eligibility for VA burial benefits. 
Title 38 U.S.C. 2302 is titled, ``Funeral expenses'', but in paragraphs 
(a) and (b) it refers to ``burial and funeral expenses'' without 
distinguishing between them. Title 38 U.S.C. 2303(a)(1)(A) refers to 
``the cost * * * of the burial and funeral'' again without distinction.
    Current VA regulations use the terms burial expenses and funeral 
expenses inconsistently. To ensure that part 5 uses consistent 
terminology, proposed Sec.  5.634(a) defines the term ``burial 
expenses'' for purposes of this subpart as ``expenses of the funeral, 
transportation, and plot or interment.'' Throughout proposed subpart J 
of part 5, we have used the term ``burial expenses'' to refer to the 
aggregate of these categories of expenses. Proposed paragraph (a) also 
states that, generally, VA will reimburse burial expenses up to the 
applicable statutory limit. Part 3 of title 38, CFR, does not contain 
comparable language, and we believe it is useful to state this general 
principle before specifically describing what VA will not provide 
reimbursement for, as is provided in current part 3.
    Paragraph (b) of proposed Sec.  5.634 is based on current 
Sec. Sec.  3.1607 and 3.1608, both of which bar reimbursement for 
particular items. The proposed rule reflects a clear and more 
contemporary articulation of these rules.
    Paragraph (b)(1) is based on current Sec.  3.1607, which states: 
``No reimbursement will be authorized for the cost of a burial flag 
privately purchased by relatives, friends, or other parties but such 
cost may be included in a claim for the burial allowance.'' The 
proposed rule would bar reimbursement for the expense of a ``privately 
purchased burial flag, except when VA was unable to provide a burial 
flag.'' The proposed language would not identify the private purchaser 
as coming from among ``relatives, friends, or other parties'' because 
the specific identity of the private purchaser is not relevant to 
whether VA will allow reimbursement.
    The proposed rule also does not include the phrase, ``but such cost 
may be included in a claim for the burial allowance,'' because that 
phrase, contained in current Sec.  3.1607, has generated confusion by 
appearing to contradict the rule that the cost of flags is not 
generally an allowable expense. The proposed rule accurately reflects 
VA's policy and practice, which is that VA will allow a claim for 
reimbursement for the purchase of a flag only when claimed as an 
expense in a case where VA was unable to provide a burial flag.
    Proposed paragraph (b)(3) would liberalize the rule stated at 
current 3.1608, which bars reimbursement for ``[a]ccessory items[, 
s]uch as items of food and drink.'' We propose to modify this rule for 
purposes of part 5 such that under the proposed rule VA will not 
reimburse the expense of an item or service that is not necessary or 
related to the funeral, burial, or transportation of the deceased 
veteran. We wish to allow reimbursement for expenses related to a 
funeral, which may in some cases include food or drink. By barring 
reimbursement only for expenses not necessary or related to the 
funeral, burial, or transportation of the deceased veteran, we believe 
the regulation is fair and easy to understand and apply.
Section 5.635 Reimbursable Transportation Expenses for Veterans Who Are 
Buried in a National Cemetery or Who Died While Hospitalized by VA
    Proposed Sec.  5.635 restates current Sec.  3.1606. The only 
changes are technical changes necessary to conform to other

[[Page 19025]]

proposed part 5 regulations and to the current requirements for 
publication in the Federal Register.
Section 5.636 Burial of Veterans Whose Remains Are Unclaimed
    Proposed Sec.  5.636 is based on current Sec. Sec.  3.1600(b)(3), 
3.1601(b)(5), and 3.1603. Section 3.1603, ``Authority for burial of 
certain unclaimed bodies,'' states, in pertinent part:

    If the body of a deceased veteran is unclaimed, there being no 
relatives or friends to claim the body, and there is burial 
allowance entitlement which is not based on Sec.  3.1600(b)(3), the 
amount provided for burial and plot or interment allowance will be 
available for the burial upon receipt of a claim accompanied by a 
statement showing what efforts were made to locate relatives or 
friends.

We believe that there is no need to retain the requirement for a 
statement showing what efforts were made to locate relatives or 
friends, because payments under 38 U.S.C. 2307 (discussed in Sec.  
5.638 of this proposed rulemaking), 38 U.S.C. 2302(a)(1) (discussed in 
Sec.  5.643 of this proposed rulemaking), and/or 38 U.S.C. 2303(b) 
(discussed in Sec.  5.645 of this proposed rulemaking) are not 
dependent upon whether the remains were claimed or unclaimed. We have, 
therefore, excluded this requirement from proposed Sec.  5.636(a)(1), 
(b), and (c). Because 38 U.S.C. 2302(a)(2) does include this 
requirement, we have included the requirement in proposed Sec.  
5.636(a)(2).

Burial Benefits Based on Service-Connected Death

Section 5.638 Burial Allowance Based on Service-Connected Death
    The second and third groups of part 5 regulations governing 
monetary burial benefits would be organized under the undesignated 
subheadings, ``Burial Benefits Based on Service-Connected Death'' and, 
``Burial Benefits Payable Regardless of Whether the Death Was Service-
Connected.'' The service-connected burial allowance would be governed 
by Sec.  5.638.
    Proposed paragraph (a) would state the general rules regarding 
eligibility for and the amount of the service-connected burial 
allowance, i.e., the burial allowance based on service-connected death, 
which are derived from current Sec.  3.1600(a) without substantive 
revision. In addition, proposed paragraph (a) would clarify that a 
service-connected death is one described in Sec.  5.504. Section 5.504 
was published as proposed on October 21, 2005. See 70 FR 61326, 61342.
    The last sentence of proposed paragraph (a) states that, subject to 
paragraph (c) of this section, payment of the service-connected burial 
allowance is in lieu of other allowances authorized by this subpart and 
is subject to the applicable further regulations in this subpart. This 
is based on the second-to-last sentence in current Sec.  3.1600(a), 
which makes entitlement to the service-connected burial allowance 
subject to the applicable further provisions of that section and 
Sec. Sec.  3.1601 through 3.1610. The proposed regulation replaces the 
regulation numbers with the reference to ``this subpart'' because all 
of subpart J of part 5, title 38, CFR, would be dedicated to burial 
regulations. We have proposed similar language in paragraph (a) of 
Sec.  5.643, governing the nonservice-connected burial allowance. The 
current version of that rule is also subject to other applicable burial 
regulations. See 38 CFR 3.1600(b)(4).
    Proposed paragraph (b) contains new material that reflects 
developments in the law subsequent to the promulgation of current Sec.  
3.1600. It provides that VA will not pay the service-connected burial 
allowance in two described circumstances. First, under proposed 
paragraph (b)(1), VA would not pay the service-connected burial 
allowance when compensation for the cause of the veteran's death is 
payable only under 38 U.S.C. 1151. Under section 1151, VA will provide 
compensation for certain disabilities or death caused by VA hospital 
care, medical or surgical treatment, examination, training and 
rehabilitation services, or compensated work therapy program ``as if'' 
such disability or death were service connected. An award of the 
service-connected burial allowance in such cases is precluded by the 
decision of the United States Court of Appeals for Veterans Claims 
(CAVC) in Mintz v. Brown, 6 Vet. App. 277, 282-83 (1994). In that case, 
the CAVC held that the widow of a veteran was not entitled to service-
connected burial benefits ``unless service connection is established 
under a statutory provision other than 38 U.S.C. 1151.'' Id. The 
proposed regulation is also consistent with Alleman v. Principi, 349 
F.3d 1368, 1371 (Fed. Cir. 2003), which stated that ``on its face 
section 1151 only grants compensation under chapter 11 and chapter 13 
of title 38,'' United States Code. In Alleman, the Court noted further 
that although section 1151 creates entitlement to housing benefits, 
``there is no basis in either the language of the pertinent statutes or 
their background that would justify construing section 1151 to 
entitle'' a claimant to National Service Life Insurance. Id. at 1372-
73.
    Similar to 38 U.S.C. 1151, 38 U.S.C. 1318 provides compensation to 
the surviving spouse and to the children of a deceased veteran as if 
the veteran's death were service-connected, after certain criteria are 
met. Proposed paragraph (b)(2) would bar payment of the service-
connected burial allowance based on receipt of dependency and indemnity 
compensation under section 1318. The rationale for proposed paragraph 
(b)(2) is similar to the rationale for proposed paragraph (b)(1): No 
statutory language expressly authorizes service-connected burial 
compensation based on the widow or child's receipt of compensation ``as 
if'' the veteran's death were service connected pursuant to 38 U.S.C. 
1318.
    A similar provision appears in this NPRM at proposed Sec.  
5.639(c), which would bar payment for transportation expenses based on 
entitlement to compensation under sections 1151 or 1318. We would add 
that paragraph for the reasons described above.
    Proposed paragraph (c)(2) authorizes VA to pay the plot or 
interment allowance for burial in a State veterans cemetery under Sec.  
5.645(a), in addition to the service-connected burial allowance. This 
reflects the amendment made to 38 U.S.C. 2307 by section 501 of the 
Veterans Benefits Act of 2003, Pub. L. No. 108-183, 117 Stat. 2651, 
2666-67. Prior to the enactment of Public Law No. 108-183, title 38, 
United States Code, did not authorize a separate plot or interment 
allowance where VA paid the burial allowance for service-connected 
death.
    Proposed Sec. Sec.  5.638, 5.643 (concerning the nonservice-
connected burial allowance), and 5.645 (concerning the plot or 
interment allowance) do not refer to current 38 CFR 3.40 (or the part 5 
counterpart thereto), which is referenced by current Sec.  3.1600(a), 
(b), and (f). The reference in the current regulation provides for the 
payment of burial benefits for certain Filipino veterans. We have 
proposed a separate group of regulations in part 5, subpart I, which 
will govern the administration of VA benefits to Filipino veterans. See 
71 FR 37790 (June 30, 2006). In view of this centralized organization, 
there is no need to refer to such veterans here in subpart J.
Section 5.639 Transportation Expenses for Burial in a National Cemetery
    Proposed Sec.  5.639 implements 38 U.S.C. 2308. Paragraphs (a) and 
(b) are derived from and consistent with current Sec.  3.1600(g). 
Proposed paragraph (c) consists of new material, as

[[Page 19026]]

discussed earlier in this NPRM in our explanation of Sec.  5.638(b).

Burial Benefits Payable Regardless of Whether the Death Was Service-
Connected

Section 5.643 Burial Allowance Based on Nonservice-Connected Death
    The nonservice-connected burial allowance would be governed by 
Sec.  5.643, which is based on current Sec.  3.1600(b). Proposed Sec.  
5.643(a) states the general rules governing when VA will pay the 
nonservice-connected burial allowance and what amount may be paid, 
using construction similar to proposed Sec.  5.638. Proposed Sec.  
5.643(b) would set forth eligibility requirements that are consistent 
with the requirements of current Sec.  3.1600(b)(1) and (2), except as 
noted below.
    Current Sec.  3.1600(b)(2) provides eligibility for the nonservice-
connected burial allowance if the deceased veteran had a ``reopened 
claim'' for pension or disability compensation pending at the time of 
the veteran's death. Rather than refer to a ``reopened claim,'' in 
proposed paragraph (b)(3) we would refer to a ``claim to reopen.'' The 
rationale for awarding death benefits based on a pending claim is that 
the veteran would have met the prerequisite for an award of the 
nonservice-connected burial allowance (i.e., the veteran would have 
been receiving disability compensation or pension effective before the 
day the veteran died) if the veteran had not died before VA granted the 
veteran's claim for compensation or pension. Thus, it is important that 
the veteran's claim to reopen was filed, but it matters less whether VA 
actually reopened the claim (but had yet to award benefits thereon). In 
other words, the proposed language more accurately describes the 
regulatory requirement that the veteran have initiated the claims-
adjudication process during his or her lifetime and that the claim is 
still pending. The use of the phrase ``claim to reopen'' rather than 
``reopened claim'' does not represent a substantive change; it merely 
clarifies the intended effect of Sec.  3.1600(b)(2).
    Current Sec.  3.1600(b)(2) further requires that for eligibility 
for the nonservice-connected burial allowance, not only must the 
deceased veteran have had a claim pending at the time of his or her 
death, but also that there have been sufficient ``evidence of record'' 
prior to the veteran's death for VA to have granted pension or 
disability compensation. We believe it would be helpful to clarify the 
meaning intended by ``evidence of record'' for the public. We propose 
to use the phrase, ``evidence in the claims file on the date of the 
veteran's death'', which is more explicit, and to define it in Sec.  
5.643(c) as, ``evidence in VA's possession on or before the date of the 
deceased veteran's death, even if such evidence was not physically 
located in the VA claims file on or before the date of death.'' This is 
consistent with the manner in which VA adjudicates claims for accrued 
benefits by the survivors of deceased veterans (see Sec.  5.550(g), 
published as proposed at 69 FR 59072, 59085), and with VA's long-
standing practice for adjudicating claims under Sec.  3.1600(b)(2). We 
also believe it is fair to claimants and places a reasonable burden 
upon VA adjudicators to be constructively in possession of evidence 
located in VA medical centers or similar VA facilities.
    Proposed paragraph (d) states that if the veteran had either an 
original claim or a claim to reopen pending at the time of death but 
the information in the claims file was not sufficient to award pension 
or disability compensation effective before the date of death, VA will 
request such evidence. If the evidence is not received within 1 year 
from the date of the request, VA will not award the burial allowance. 
The current regulation, Sec.  3.1600(b)(2) may be subject, incorrectly, 
to a more limited interpretation, because the current version of this 
provision appears in a paragraph, Sec.  3.1600(b)(2)(ii), dealing only 
with a reopened claim. We believe it will be clearer if the proposed 
regulation specifically refers to both a pending original claim and a 
pending claim to reopen.
    Proposed paragraph (e) would identify the additional burial 
benefits--plot allowance and transportation expenses--potentially 
available in cases of non-service-connected death and would provide 
cross-references to the regulations governing those payments. Pursuant 
to 38 U.S.C. 2308, transportation expenses would not be payable for all 
nonservice-connected deaths, but only where the veteran was in receipt 
of compensation rather than pension. Proposed paragraph (e) would 
reflect this limitation.
Section 5.644 Burial Allowance for Veteran Who Died While Hospitalized 
by VA
    Proposed Sec.  5.644 would implement the third burial allowance 
authorized by title 38, United States Code, which is the allowance 
provided for a veteran who died while hospitalized by VA, set forth at 
38 U.S.C. 2303. Except as noted below, proposed Sec.  5.644 restates 
rules found in current Sec. Sec.  3.1600(c) and 3.1605, without 
substantive change.
    The last sentence of proposed paragraph (a) states, ``Payment under 
this section is subject to the applicable further regulations in this 
subpart.'' Current Sec.  3.1605 states that ``[t]he amount payable 
under this section is subject to the limitations set forth in paragraph 
(b) of this section, and Sec. Sec.  3.1604 and 3.1606.'' It is true 
that the amount payable under the current rule is subject to such 
limitations. However, it is also true that the other provisions of 
current Sec.  3.1605, i.e., those that do not relate to the amount 
payable, are subject to other applicable limitations set forth in the 
part 3 burial regulations. Thus, we would use broader language in the 
proposed rule.
    We propose not to include in part 5 the rule in current Sec.  
3.1605(b) that denies eligibility for transportation expenses to 
``retired persons hospitalized under section 5 of Executive Order 10122 
* * * issued pursuant to Pub. L. 351, 81st Congress, and not as 
Department of Veterans Affairs beneficiaries.'' Section 5 of Executive 
Order 10122 related to current and former service members who had been 
hospitalized for chronic diseases between May and October of 1950. 
Executive Order 10122 is more than half a century old and applied to a 
very small group of veterans. The reference is outdated and no longer 
necessary.
    Current Sec.  3.1605(c) extends entitlement to burial benefits to 
the following persons who die while properly hospitalized by the 
Department of Veterans Affairs: (1) Discharged or rejected draftees; 
(2) Members of the National Guard who reported to camp in answer to the 
President's call for World War I, World War II, or Korean service, but 
who when medically examined were not finally accepted for active 
military service; or (3) A veteran discharged under conditions other 
than dishonorable from a period of service other than a war period. We 
propose not to include such a provision in part 5. With respect to 
persons described in Sec.  3.1605(c)(1) and (2) (draftees and National 
Guard members not accepted for active service), proposed Sec.  5.26 
sets forth the circumstances under which they may be eligible for VA 
benefits. (Proposed Sec.  5.26 is the part 5 counterpart to current 
Sec.  3.7(o) and was published on January 30, 2004. See 69 FR 4820, 
4835.) Regarding veterans discharged under conditions other than 
dishonorable from a period of service other than a war period, they are 
included in the definition of veteran under Sec.  5.631(a)(1) and, as 
such, are eligible for burial benefits. Accordingly,

[[Page 19027]]

it is unnecessary to include those provisions in this regulation.
    The proposed rule would also not incorporate the rule currently in 
Sec.  3.1605(e) that states: ``Where a deceased person was not properly 
hospitalized, benefits will not be authorized under this section.'' 
Proposed Sec.  5.644 clearly authorizes benefits only to persons who 
die while hospitalized pursuant to statutory authorities specified in 
that rule or who meet other criteria set forth in the rule. The 
proposed rule in no way suggests that it establishes additional 
entitlement to a person who was not hospitalized pursuant to statutory 
authorities within the definition of the rule. Including an express 
statement to that effect, such as that contained in Sec.  3.1605(e), is 
unnecessary.
Section 5.645 Plot or Interment Allowance
    In proposed Sec.  5.645, we would include all of the rules 
governing awards of a plot or interment allowance. These rules 
currently appear in three different regulations, Sec. Sec.  3.1600(f), 
3.1601(a)(3), and 3.1604(d). We propose not to include the first 
sentence of current Sec.  3.1604(d)(2), ``A claim for payment under 
this paragraph shall be executed by a State, or an agency or political 
subdivision of a state on a claim form prescribed by the Department of 
Veterans Affairs'' because it is redundant of the provision in current 
Sec.  3.151(a), and we intend to propose a part 5 counterpart to 
current Sec.  3.151(a) in a separate NPRM.
    The relevant authorizing statutes have been amended by the Veterans 
Benefits Act of 2003, Public Law 108-183, Sec. 501, 117 Stat. 2651, 
2666-67. Section 501 of Public Law 108-183 removed the previously 
existing barrier that prevented VA from paying the plot or interment 
allowance based on the burial of a veteran on whose behalf VA also 
provided the service-connected burial allowance; however, the amendment 
only removed that barrier as to the plot or interment allowance payable 
to a State, or an agency or political subdivision of a State, under 38 
U.S.C. 2302(b)(1). VA continues to lack authority to provide the plot 
or interment allowance payable under 38 U.S.C. 2302(b)(2) based on the 
burial of a veteran on whose behalf VA also provided the service-
connected burial allowance. Hence, paragraph (a) of the proposed rule 
conforms to the requirements of the new statute.
    Proposed Sec.  5.645(a) would govern payment of the burial 
allowance under section 2303(b)(1), implementing the changes made by 
Public Law 108-183. Under the proposed rule, VA would pay the plot or 
interment allowance in the amount specified in 38 U.S.C. 2303(b)(1) to 
a State, or an agency or political subdivision of a State, that 
provided a burial plot for a veteran when the veteran meets the 
described criteria. Proposed paragraph (a) would note, in parentheses, 
that the plot or interment allowance is payable under paragraph (a) 
``without regard to whether any other burial benefits were provided 
based on that veteran.'' We would include this language for clarity, 
due to the newness of the change in the law on this subject.
    In addition to being revised based on Public Law 108-183, the 
proposed rule would not include the caveat from current Sec.  
3.1604(d)(1)(v) that payment will be authorized only if ``[t]he veteran 
was buried on or after October 1, 1978.'' It is unlikely in the extreme 
that VA will receive claims for the plot or interment allowance, 
especially claims by a State, or an agency or political subdivision of 
a State, based upon a burial that occurred 30 years ago. Hence, the 
reference is no longer useful.
    Proposed Sec.  5.645(b) is substantively similar to current Sec.  
3.1600(f); however, the proposed rule contains a technical correction 
for the purpose of restating that rule in part 5. Current Sec.  
3.1600(f)(2)(iii) offers entitlement to the plot or interment 
allowance, inter alia, when:

    The veteran was discharged from the active military, naval, or 
air service for a disability incurred or aggravated in line of duty 
(or at time of discharge has such a disability, shown by official 
service records, which in medical judgment would have justified a 
discharge for disability; the official service department record 
showing that the veteran was discharged or released from service for 
disability incurred in line of duty will be accepted for determining 
entitlement to the plot or interment allowance notwithstanding that 
the Department of Veterans Affairs has determined, in connection 
with a claim for monetary benefits, that the disability was not 
incurred in line of duty) * * *.

38 CFR 3.1600(f)(2)(iii). The material that appears before the 
semicolon in the above paragraph is the extent of the material that 
should have appeared within the parenthetical. After the semicolon, the 
regulation describes evidence showing a discharge from service due to 
disability, which clearly applies only to a veteran who was 
``discharged from the active military, naval, or air service for a 
disability incurred or aggravated in line of duty'' as referenced 
before the parenthetical begins. The material that appears within the 
parenthetical but before the semicolon refers to a veteran who was not 
discharged due to disability, but who could have been so discharged 
based on other medical evidence. This represents a technical error in 
part 3. We would not duplicate the problem contained in the part 3 
version of the rule by reorganizing the material as shown in the 
proposed regulation. The substantive effect of the rule, as 
reorganized, is consistent with other part 3 rules that contain 
language similar to Sec.  3.1600(f)(2)(iii) but without the technical 
error therein. See, e.g., 38 CFR 3.3(a)(1)(ii), 3.12a(d)(2).

Special Rules Governing Payments

Section 5.649 Priority of Payments When There Is More Than One Claimant
    Proposed Sec.  5.649 would describe the order in which VA will 
reimburse multiple claimants for burial benefits.
    Under the current rule, VA will pay providers of services before 
paying ``persons whose personal funds were expended.'' 38 CFR 
3.1602(b). In turn, people who used personal funds take priority over 
estates. 38 CFR 3.1602(c). Thus, under the current rule VA will 
reimburse a claimant who performed services or provided items 
(including a burial plot) and who has not been fully paid for the 
services or items first; next, VA will reimburse persons who expended 
personal funds; and last, VA will reimburse an estate. The current rule 
does not set forth this hierarchy in order of preference for payment. 
Proposed Sec.  5.649(a) through (c) would do so. The proposed 
paragraphs would be more straightforward than the current rule, but 
would not alter the existing payment hierarchy.
    Proposed paragraph (a) differs from current Sec.  3.1602(b) in that 
the proposed rule would offer payment preference to claimants who 
``provided items.'' The current rule provides preference to persons who 
``performed * * * services or furnished the burial plot.'' The current 
reference to ``services'' is intended to include items such as a 
coffin. The proposed use of the term, ``items,'' is merely a 
clarification of current VA policy.
    Proposed paragraph (d) discusses payment priority in claims for the 
plot or interment allowance. It incorporates current rules from 
Sec. Sec.  3.1601(a)(2)(iii) and 3.1604(d)(4).
    Proposed Sec.  5.649(e) would clarify the current rule regarding 
waivers. Current Sec.  3.1602(a) states that, if two or more persons 
have paid from their personal funds, burial benefits will be divided 
among such persons in accordance with the proportionate share paid by 
each, unless waiver is executed in favor of one of such persons by the 
other person or persons involved. The placement of

[[Page 19028]]

the waiver rule in the context of a paragraph titled, ``Two or more 
persons expended funds,'' suggests that waiver only applies to persons 
who used personal funds to pay burial expenses. However, VA will accept 
as valid a waiver from any claimant. Thus, we propose to place the 
waiver rules in a separate paragraph that clearly applies to the entire 
section.
Section 5.650 Escheat (Payment of Burial Benefits to an Estate With No 
Heirs)
    Proposed Sec.  5.650 restates the rule in cases of escheat, which 
appears in current Sec.  3.1602(d). We would place the rule in its own 
regulation because it does not logically fit any other proposed rule.
Section 5.651 Effect of Contributions by Government, Public, or Private 
Organizations
    Proposed Sec.  5.651 would provide special rules that apply when 
the deceased veteran's burial expenses have been paid for, in part or 
in full, by certain governmental and non-governmental organizations.
    Proposed paragraph (a) restates the first sentence of current Sec.  
3.1604(a), with the clarification that the rule applies to all types of 
expenses that may be paid as ``burial benefits.'' The current rule uses 
the term ``burial expenses,'' which for the reasons explained above 
concerning proposed Sec.  5.634, may have lead to the misperception 
that VA will not consider contributions by public or private 
organizations when VA is presented with a claim for reimbursement of 
expenses related to the transportation of the remains or the purchase 
of a burial plot. Proposed Sec.  5.634 would clarify this matter by 
defining ``burial expenses'' to include transportation and plot 
expenses. To further clarify that proposed Sec.  5.651 would apply to 
all such expenses, paragraph (a) would state that the rule applies to 
claims for ``burial benefits.'' These clarififcations also eliminate 
the need for current Sec.  3.1604(c), which states that the rule in 
current Sec.  3.1604(a) applies to the plot or interment allowance. The 
proposed rule would clarify that the limitations contained in current 
Sec.  3.1604(a) and (c) only apply to nonservice-connected burial 
benefits. Although 38 U.S.C. 2302(b) and 2303(b)(2) limit payment of 
nonservice-connected burial benefits when payment has been made by a 
government or employer, 38 U.S.C. 2307, which establishes the right to 
a service-connected burial allowance, contains no such bar.
    Proposed paragraph (b), dealing with contributions or payments of 
burial expenses by other public or private organizations, is derived 
from current Sec.  3.1604(a) and (c). The proposed rule would clarify 
that the limitations contained in current Sec.  3.1604(a) and (c) only 
apply to nonservice-connected burial benefits. Although 38 U.S.C. 
2302(b) bars payment of nonservice-connected burial benefits if they 
would revert to or relieve an obligation of a public or private 
organization, 38 U.S.C. 2307, which establishes the right to a service-
connected burial allowance, contains no such bar. Because proposed 
paragraph (b) relates to both burial allowance and plot or interment 
allowance, we propose to use the generic term ``burial benefits'' 
rather than ``burial allowance.''
    Proposed paragraph (c) is derived from current Sec.  3.1604(b)(1) 
and (2). The proposed paragraph differs from the current rule in 
several respects. Current Sec.  3.1604(b)(1) states:

    Where a veteran dies while in employment covered by the United 
States Employees' Compensation Act, as amended, or other similar 
laws specifically providing for payment of the expenses of funeral, 
transportation, and interment out of Federal funds, burial allowance 
will not be authorized by the Department of Veterans Affairs.

By specifically listing the ``United States Employees' Compensation 
Act,'' the rule may be misread to apply only when the deceased veteran 
was a Federal employee. However, 38 U.S.C. 2302(b) requires VA to 
withhold burial benefits ``in any case where specific provision is 
otherwise made for payment of expenses of funeral, transportation, and 
interment under any other Act.'' We propose to use language in Sec.  
5.651(c)(1) that is similar to the statutory language, in order to 
ensure that the law is given its full intended effect.
    In addition, current Sec.  3.1604(b)(1) states that where a law 
specifically provides for ``payment of the expenses of funeral, 
transportation, and interment out of Federal funds, burial allowance 
will not be authorized.'' (Emphasis added). The proposed rule would 
instead make this bar applicable only to the nonservice-connected 
burial allowance. Although 38 U.S.C. 2302(b) bars payment of the 
nonservice-connected burial allowance, as described above, 38 U.S.C. 
2307, which establishes the right to a service-connected burial 
allowance, contains no such bar. Likewise, 38 U.S.C. 2303, which 
establishes the right to a burial allowance for veterans who died while 
hospitalized by VA and the right to a plot or interment allowance, 
contains no such bar.
    Proposed paragraph Sec.  5.651(c)(3) would require an election 
between service-department and VA burial benefits in cases where both 
benefits are payable because the veteran died while hospitalized at the 
expense of the United States government. The rule, which avoids 
duplicate payments, represents current VA policy previously unstated in 
regulation. Furthermore, we believe that the election is required by 10 
U.S.C. 1482(b), which states, ``If reimbursement by the United States 
is also authorized under another provision of law or regulation, the 
individual may elect under which provision to be reimbursed.''
Section 5.652 Effect of Forfeiture on Payment of Burial Benefits
    Proposed Sec.  5.652 restates, in plain language, current Sec.  
3.1609, which governs the effect of a deceased veteran's or a 
claimant's forfeiture of the right to receive VA benefits on the right 
of a claimant to receive burial benefits. The only substantive change 
is that we propose to remove the requirement, contained in Sec.  
3.1609(b) that the pardon must have been granted during the veteran's 
lifetime. There is no such requirement in the relevant statutes, 38 
U.S.C. 6103 and 6104. Moreover, the proposed VA regulation concerning 
the effect of a Presidential pardon on forfeiture, Sec.  5.682, 
``Presidential pardon for offenses causing forfeiture,'' see 71 FR 
31056, 31065-68 (May 31, 2006), contains no such requirement, and it 
would be inconsistent to impose it on claimants seeking burial 
benefits.
    Current Sec.  3.1609 lists the authority citations as 38 U.S.C. 
5904(c)(2) and 5905(a). However, this citation is outdated. We propose 
to update the authority citations to the correct authorities, which are 
38 U.S.C. 6103, 6104, and 6105, which govern forfeiture for fraud, 
treason, and subversive activities.
Section 5.653 Eligibility Based on Status Before 1958
    We propose to repeat the language of current Sec.  3.954 at Sec.  
5.653, without change.

Additional Regulations From Part 3 That Will Not Be Included in Part 5

    For the reasons discussed below, we propose not to include in part 
5 the rules contained in the following regulations and paragraphs from 
current part 3.

[[Page 19029]]

38 CFR 3.1610(a)

    We propose not to include current Sec.  3.1610(a), relating to 
burial of a deceased veteran in a national cemetery. Current Sec.  
3.1610 reads, in relevant part:

    The statutory burial allowance and permissible transportation 
charges as provided in Sec. Sec.  3.1600 through 3.1611 are also 
payable under the following conditions:
    (a) Where burial of a deceased veteran is in a national 
cemetery, provided that burial in a national cemetery is desired by 
the person or persons entitled to the custody of the remains for 
interment and permission for burial has been received from the 
officers having jurisdiction over burials in national cemeteries * * 
*.

    Section 3.1610(a) merely states that burial in a national cemetery 
does not bar payment of burial benefits. There is no conflicting 
statement in the proposed regulations that authorize the various 
monetary burial benefits, which unambiguously state the requirements 
for payment of burial benefits. Moreover, proposed Sec. Sec.  5.638(c) 
and 5.639(a) specifically authorize payment of transportation expenses 
based on burial in a national cemetery. Hence, there is no reason to 
include current Sec.  3.1610(a) in part 5.

38 CFR 3.1611

    Current Sec.  3.1611 provides: ``When requested by the person 
entitled to the custody of the body of a deceased beneficiary of the 
Department of Veterans Affairs, official representation at the funeral 
will be granted provided an employee is available for the purpose and 
this representation will entail no expense to the Department of 
Veterans Affairs.'' It has been and continues to be VA's policy to 
accommodate a request for VA representation at the burial of a veteran, 
subject to issues of availability and cost. However, we do not believe 
it is necessary to stipulate this policy in the U.S. Code of Federal 
Regulations.

38 CFR 3.1612

    We propose not to include current Sec.  3.1612, which implements a 
repealed statutory provision. The rule provides a monetary allowance in 
lieu of a Government-furnished headstone or marker. The authority for 
the rule is a former version of 38 U.S.C. 2306(d) that was deleted from 
the United States Code in 1990. Pub. L. 101-508, title VIII, Sec.  
8041(a), 104 Stat. 1388, 1388-349 (1990). At the time that section 2306 
was amended, VA believed that it was necessary to retain Sec.  3.1612 
because we still had authority to offer the benefit to veterans who 
died before November 1990. See Sec.  3.1612(h) (recognizing that the 
``monetary allowance [payable under Sec.  3.1612] is not payable if 
death occurred on or after November 1, 1990.'') We believe that the 
passage of time has rendered the rule obsolete. In the unlikely event 
that a claimant seeks the monetary allowance authorized under former 
section 2306(d) based on a veteran who died before November 1990, we 
would be authorized to pay the benefit pursuant to former section 
2306(d), even in the absence of a VA regulation authorizing payment of 
the benefit.

Endnote Regarding Amendatory Language

    We intend to ultimately remove part 3 entirely, but we are not 
including amendatory language to accomplish that at this time. VA will 
provide public notice before removing part 3.

Paperwork Reduction Act of 1995

    This document contains no provisions constituting a collection of 
information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-
3521).

Regulatory Flexibility Act

    The Secretary hereby certifies that this proposed regulatory 
amendment will 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. Although this rule includes 
provisions providing for payments to some small entities, including 
funeral homes and local governments, the provisions merely restate 
existing provisions of statute and regulation and thus will have no 
additional impact on such small entities. Therefore, pursuant to 5 
U.S.C. 605(b), this proposed amendment is exempt from the initial and 
final regulatory flexibility analysis requirements of sections 603 and 
604.

Executive Order 12866

    Executive Order 12866 directs agencies to assess all 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, 
and other advantages; distributive impacts; and equity). The Executive 
Order classifies a ``significant regulatory action,'' requiring review 
by the Office of Management and