[Federal Register Volume 77, Number 75 (Wednesday, April 18, 2012)]
[Rules and Regulations]
[Pages 23128-23130]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-9295]


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DEPARTMENT OF VETERANS AFFAIRS

38 CFR Parts 3 and 20

RIN 2900-AO43


Rules Governing Hearings Before the Agency of Original 
Jurisdiction and the Board of Veterans' Appeals; Repeal of Prior Rule 
Change

AGENCY: Department of Veterans Affairs.

ACTION: Direct final rule.

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SUMMARY: The Department of Veterans Affairs (VA) is taking final action 
to amend its hearing regulations to repeal a prior amendment that 
specified that the provisions regarding hearings before the Agency of 
Original Jurisdiction (AOJ) do not apply to hearings before the Board 
of Veterans' Appeals (Board). This action is being taken because of 
VA's decision that the prior amendment should have followed the notice-
and-comment procedure of the Administrative Procedure Act (APA).

DATES: This rule is effective June 18, 2012, without further notice, 
unless VA receives a significant adverse comment by May 18, 2012. If 
adverse comment is received, VA will publish a timely withdrawal of the 
rule in the Federal Register.

ADDRESSES: Written comments may be submitted through 
www.Regulations.gov; by mail or hand-delivery to the Director, 
Regulations Management (02REG), Department of Veterans Affairs, 810 
Vermont Ave. NW., Room 1068, Washington, DC 20420; or by fax to (202) 
273-9026. Comments should indicate that they are submitted in response 
to ``RIN 2900-AO43--Rules Governing Hearings Before the Agency of 
Original Jurisdiction and the Board of Veterans' Appeals; Repeal of 
Prior Rule Change.'' 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 
(this is not a toll-free number). In addition, during the comment 
period, comments may be viewed online through the Federal Docket 
Management System (FDMS) at www.Regulations.gov.

FOR FURTHER INFORMATION CONTACT: Laura H. Eskenazi, Principal Deputy 
Vice Chairman, Board of Veterans' Appeals (01C2), Department of 
Veterans Affairs, 810 Vermont Avenue NW., Washington, DC 20420, (202) 
632-4603. (This is not a toll-free number.)

SUPPLEMENTARY INFORMATION: On August 23, 2011, VA issued a final rule, 
``Rules Governing Hearings Before the Agency of Original Jurisdiction 
and the Board of Veterans' Appeals; Clarification,'' 76 FR 52572 (RIN 
2900-AO06), revising VA's regulations to specify that the provisions 
governing hearings in 38 CFR 3.103 only apply to hearings conducted 
before the AOJ and that the provisions in part 20 govern hearings 
before the Board. The revision was made because of a decision by the 
United States Court of Appeals for Veterans Claims (Court) in Bryant v. 
Shinseki, 23 Vet. App. 488 (2010), which applied the provisions of 
Sec.  3.103(c)(2) to a Board hearing. The Bryant Court held that the 
provisions of Sec.  3.103(c)(2) require a ``Board hearing officer'' to 
``fully explain the issues still outstanding that are relevant and 
material to substantiating the claim'' and to ``suggest that a claimant 
submit evidence on an issue material to substantiating the claim when 
the record is missing any evidence on that issue or when the testimony 
at the hearing raises an issue for which there is no evidence in the 
record.'' Id. at 496-97.
    RIN 2900-AO06, among other things, altered the language upon which 
the Bryant Court relied. VA has determined that RIN 2900-AO06 should 
have followed the notice-and-comment procedure of 5 U.S.C. 553(b) and 
(c) of the APA. Accordingly, in this direct-final rule, VA is repealing 
the amendments made by RIN 2900-AO06.
    Based on the rationale set forth in this preamble, VA amends, in 
part 3, Sec.  3.103(a) and (c)(1), and, in part 20, Sec.  20.706 and 
Appendix A, to return the regulations to the language in effect before 
August 23, 2011.

Administrative Procedure Act

    VA believes this rule is non-controversial, anticipates that this 
rule will not result in any significant adverse comment, and therefore 
is issuing it as a direct final rule.
    For purposes of the direct final rulemaking, a significant adverse 
comment is one that explains why the rule would be inappropriate, 
including challenges to the rule's underlying premise or approach, or 
why it would be ineffective or unacceptable without a change. In 
determining whether an adverse comment is significant and warrants 
withdrawing a direct final rule, we will consider whether the comment 
raises an issue serious enough to warrant a substantive response in a 
notice-and-comment process in accordance with section 553 of the APA (5 
U.S.C. 553). Comments that are frivolous, insubstantial, or outside the 
scope of the rule will not be considered adverse under this procedure. 
For example, a comment recommending an additional change to the rule 
will not be considered a significant comment unless the comment states 
why the rule would be ineffective without the additional change.
    Under direct final rule procedures, if no significant adverse 
comment is received within the comment period, the rule will become 
effective on the date specified above. After the close of the comment 
period, VA will publish a document in the Federal Register indicating 
that no significant adverse comment was received and confirming the 
effective date of the rule.
    However, if any significant adverse comment is received, VA will 
publish in the Federal Register a notice acknowledging receipt of a 
significant adverse comment and withdrawing the direct final rule. We 
will then publish in the Federal Register a proposed rule document, 
which will be substantially identical to this direct final rule and 
will serve as a proposal for the amendments in this direct final rule. 
Any comments received in response to the direct final rule will be 
treated as comments regarding the proposed rule. VA will consider such 
comments in developing a subsequent final rule.

Paperwork Reduction Act

    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 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. This rulemaking will not directly affect any small 
entities. Only VA beneficiaries will be directly affected. Therefore, 
pursuant to 5 U.S.C. 605(b), this amendment is exempt from the initial 
and final regulatory flexibility analysis requirements of sections 603 
and 604.

[[Page 23129]]

Executive Orders 12866 and 13563

    Executive Orders 12866 and 13563 direct 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 12866 (Regulatory Planning and Review) defines a 
``significant regulatory action,'' which requires review by the Office 
of Management and Budget (OMB), as ``any regulatory action that is 
likely to result in a rule that may: (1) Have an annual effect on the 
economy of $100 million or more or adversely affect in a material way 
the economy, a sector of the economy, productivity, competition, jobs, 
the environment, public health or safety, or State, local, or tribal 
governments or communities; (2) Create a serious inconsistency or 
otherwise interfere with an action taken or planned by another agency; 
(3) Materially alter the budgetary impact of entitlements, grants, user 
fees, or loan programs or the rights and obligations of recipients 
thereof; or (4) Raise novel legal or policy issues arising out of legal 
mandates, the President's priorities, or the principles set forth in 
this Executive Order.''
    The economic, interagency, budgetary, legal, and policy 
implications of this regulatory action have been examined and it has 
been determined not to be a significant regulatory action under 
Executive Order 12866.

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 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 given year. This rule will have no such effect on 
State, local, and tribal governments, or on the private sector.

Catalog of Federal Domestic Assistance

    The Catalog of Federal Domestic Assistance program numbers and 
titles for this rule are 64.027, Post-9/11 Veterans Educational 
Assistance; 64.028, Post-9/11 Veterans Educational Assistance; 64.032, 
Montgomery GI Bill Selected Reserve; Reserve Educational Assistance 
Program; 64.100, Automobiles and Adaptive Equipment for Certain 
Disabled Veterans and Members of the Armed Forces; 64.101, Burial 
Expenses Allowance for Veterans; 64.103, Life Insurance for Veterans; 
64.104, Pension for Non-Service-Connected Disability for Veterans; 
64.105, Pension to Veterans Surviving Spouses, and Children; 64.106, 
Specially Adapted Housing for Disabled Veterans; 64.109, Veterans 
Compensation for Service-Connected Disability; 64.110, Veterans 
Dependency and Indemnity Compensation for Service-Connected Death; 
64.114, Veterans Housing-Guaranteed and Insured Loans; 64.115, Veterans 
Information and Assistance; 64.116,Vocational Rehabilitation for 
Disabled Veterans; 64.117, Survivors and Dependents Educational 
Assistance; 64.118, Veterans Housing-Direct Loans for Certain Disabled 
Veterans; 64.119, Veterans Housing-Manufactured Home Loans; 64.120, 
Post-Vietnam Era Veterans' Educational Assistance; 64.124, All-
Volunteer Force Educational Assistance; 64.125, Vocational and 
Educational Counseling for Servicemembers and Veterans; 64.126, Native 
American Veteran Direct Loan Program; 64.127, Monthly Allowance for 
Children of Vietnam Veterans Born with Spina Bifida; and 64.128, 
Vocational Training and Rehabilitation for Vietnam Veterans' Children 
with Spina Bifida or Other Covered Birth Defects.

Signing Authority

    The Secretary of Veterans Affairs, or designee, approved this 
document 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. John R. 
Gingrich, Chief of Staff, Department of Veterans Affairs, approved this 
document on April 10, 2012, for publication.

List of Subjects

38 CFR Part 3

    Administrative practice and procedure, Claims, Disability benefits, 
Health care, Pensions, Radioactive materials, Veterans, Vietnam.

38 CFR Part 20

    Administrative practice and procedure, Claims, Veterans.

    Dated: April 13, 2012.
Robert C. McFetridge,
Director of Regulation Policy and Management, Office of the General 
Counsel, Department of Veterans Affairs.
    For the reasons set forth in the preamble, VA amends 38 CFR parts 3 
and 20 as follows:

PART 3--ADJUDICATION

Subpart A--Pension, Compensation, and Dependency and Indemnity 
Compensation

0
1. The authority citation for part 3, subpart A continues to read as 
follows:

    Authority:  38 U.S.C. 501(a), unless otherwise noted.


0
2. Amend Sec.  3.103 by:
0
a. Removing the last two sentences of paragraph (a) and adding, in its 
place, ``The provisions of this section apply to all claims for 
benefits and relief, and decisions thereon, within the purview of this 
part 3.''.
0
b. Revising paragraph (c)(1).
    The revision reads as follows:


Sec.  3.103  Procedural due process and appellate rights.

* * * * *
    (c) * * * (1) Upon request, a claimant is entitled to a hearing at 
any time on any issue involved in a claim within the purview of part 3 
of this chapter, subject to the limitations described in Sec.  20.1304 
of this chapter with respect to hearings in claims which have been 
certified to the Board of Veterans' Appeals for appellate review. VA 
will provide the place of hearing in the VA office having original 
jurisdiction over the claim or at the VA office nearest the claimant's 
home having adjudicative functions, or, subject to available resources 
and solely at the option of VA, at any other VA facility or federal 
building at which suitable hearing facilities are available. VA will 
provide one or more employees who have original determinative authority 
of such issues to conduct the hearing and be responsible for 
establishment and preservation of the hearing record. Hearings in 
connection with proposed adverse actions and appeals shall be held 
before one or more VA employees having original determinative authority 
who did not participate in the proposed action or the decision being 
appealed. All expenses incurred by the claimant in connection with the 
hearing are the responsibility of the claimant.
* * * * *

[[Page 23130]]

PART 20--BOARD OF VETERANS' APPEALS: RULES OF PRACTICE

0
3. The authority citation for part 20 continues to read as follows:

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

Subpart H--Hearings on Appeal

0
4. Revise Sec.  20.706 to read as follows:


Sec.  20.706  Rule 706. Functions of the presiding Member.

    The presiding Member of a hearing panel is responsible for the 
conduct of the hearing, administration of the oath or affirmation, and 
for ruling on questions of procedure. The presiding Member will assure 
that the course of the hearing remains relevant to the issue, or 
issues, on appeal and that there is no cross-examination of the parties 
or witnesses. The presiding Member will take such steps as may be 
necessary to maintain good order at hearings and may terminate a 
hearing or direct that the offending party leave the hearing if an 
appellant, representative, or witness persists in disruptive behavior.

0
5. Amend the table in Appendix A to Part 20 by:
0
a. Adding entry 20.1.
0
b. Revising entry 20.1304.
    The revision and addition read as follows:

APPENDIX A TO PART 20--CROSS-REFERENCES

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                                                        Title of cross-
                                                          referenced
              Sec.                  Cross-reference       material or
                                                            comment
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20.1............................  38 CFR 3.103(a)...  Statement of
                                                       policy.
 
                              * * * * * * *
20.1304.........................  38 CFR 3.103(c),    See also re
                                   20.700-20.717.      hearings.
                                  38 CFR 3.156......  New and material
                                                       evidence.
                                  38 CFR 3.160(e)...  Reopened claim.
                                  38 CFR 20.305.....  Rule 305.
                                                       Computation of
                                                       time limit for
                                                       filing.
                                  38 CFR 20.306.....  Rule 306. Legal
                                                       holidays.
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[FR Doc. 2012-9295 Filed 4-17-12; 8:45 am]
BILLING CODE 8320-01-P