[Federal Register Volume 61, Number 36 (Thursday, February 22, 1996)]
[Rules and Regulations]
[Pages 6780-6791]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-3780]



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DEPARTMENT OF VETERANS AFFAIRS

38 CFR Part 21

RIN 2900-AG22


Veterans Education: Implementation of the Veterans' Benefits Act 
of 1992, the National Defense Authorization Act for Fiscal Year 1993, 
and the National Defense Authorization Act for Fiscal Year 1994

AGENCY: Department of Veterans Affairs.

ACTION: Final rule.

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SUMMARY: This document amends the educational assistance and 
educational benefits regulations of the Department of Veterans Affairs 
(VA). It makes changes concerning eligibility requirements for 
educational assistance and benefits, rates of payment for educational 
assistance, measurement of training time, approval of various types of 
courses, and educational death benefits. These changes restate 
statutory requirements and set forth VA's statutory interpretations.

DATES: This final rule is effective February 22, 1996. However, the 
restatements of statute and VA's statutory interpretations contained in 
this final rule will be applied retroactively from the effective dates 
of the statutory provisions. For more information concerning the 
application of statutes and statutory interpretations, see the 
SUPPLEMENTARY INFORMATION section.

FOR FURTHER INFORMATION CONTACT:
June C. Schaeffer, Assistant Director for Policy and Program 
Administration, Education Service, Veterans Benefits Administration, 
202-273-7187.

SUPPLEMENTARY INFORMATION: Regulations concerning VA-administered 
educational assistance and educational benefits are contained in 38 CFR 
Part 21. The Veterans' Benefits Act of 1992 (Pub. L. 102-568) amends 
educational assistance provisions under the Montgomery GI Bill--Active 
Duty and amends other provisions that affect work-study under the 
Survivors' and Dependents' Educational Assistance program. The National 
Defense Authorization Act for Fiscal Year 1993 (Pub. L. 102-484) and 
the National Defense Authorization Act for Fiscal Year 1994 (Pub. L. 
103-160) also amend provisions concerning educational assistance under 
the Montgomery GI Bill--Active Duty. This document contains a number of 
changes to the regulations which merely reflect certain changes made by 
these public laws. These changes to the regulations are as follows.
    Under Pub. L. 102-568, the limit on the amount of money that VA can 
pay in advance on a work-study contract has been changed. Formerly, 
that limit was 40 percent of the total amount payable under the 
contract. Now the limit is the lesser of 40 percent of the total amount 
payable under the contract or 50 times the applicable minimum hourly 
wage in effect on the date the contract is signed. Changes are made to 
38 CFR 21.3145 and 21.7145 to reflect these statutory provisions.
    Pub. L. 102-484 includes the Service Members Occupational 
Conversion and Training Act (SMOCTA) (sec. 4481 through 4497, Pub. L. 
102-484), which forbids receipt of educational assistance under any of 
the education programs administered by VA when the veteran, 
servicemember, or other eligible person is participating in a job 
training program under SMOCTA. Revisions are made to 38 CFR 21.4131, 
21.4135, 21.7131, and 21.7135 to reflect these statutory provisions.
    Pub. L. 102-568 provides for later ending dates when the veteran 
dies during the period covered by an advance payment of educational 
assistance. Prior to the effective date of Pub. L. 102-568, educational 
assistance was terminated effective the date the veteran died. However, 
Pub. L. 102-568 provides that in the event of a death, the effective 
date of the termination will be the last date covered by the advance 
payment. Revisions are made to 38 CFR 21.4135 and 21.7135 to reflect 
these statutory provisions.
    Pub. L. 102-568 prohibits State approving agencies from approving 
for VA educational assistance a course of education that includes 
nonaccredited independent study. It also prohibits VA from approving an 
enrollment in an independent study course unless the course is 
accredited and leads to a standard college degree. Revisions are made 
to 38 CFR 21.4252, 21.7120, 21.7122, 21.7220 and 21.7222 to reflect 
these statutory changes. However, under Pub. L. 102-568 these 
prohibitions do not apply to any person receiving educational 
assistance for pursuit of an independent study program in which the 
person was enrolled on the date of enactment of Pub. L. 102-568 
(October 29, 1992) who remains ``continuously * * * enrolled'' and 
otherwise meets the requirements for eligibility for such assistance in 
effect on October 29, 1992. Revisions are made to Secs. 21.4252 and 
21.7120 to restate these statutory provisions. Also, the following 
definition of ``continuously enrolled'' is added to 38 CFR 21.7020 to 
interpret what constitutes ``continuously enrolled'':


[[Page 6781]]

    The term continuously enrolled means being in an enrolled status 
at an educational institution for each day during the school year, 
and for consecutive school years. Continuity of enrollment is not 
broken by holiday vacations; vacation periods; periods during the 
school year between terms, quarters, or semesters; or by 
nonenrollment during periods of enrollment outside the school year 
(e.g., summer sessions).

The Congress did not indicate that a special meaning other than the 
common meaning was intended for ``continuously enrolled.'' Therefore, 
we have concluded that the Congress intended that we interpret 
``continuously enrolled'' consistent with its common meaning and we 
have formulated the definition of ``continuously enrolled'' in 
accordance with our understanding of the Congressional intent.
    Pub. L. 102-568 repealed the special provisions for determining 
students' training time while enrolled in independent study, thereby 
making the determination of this training time the same as that for 
resident training. Consequently, the monthly rates for educational 
assistance for independent study and for resident study are based on 
the same formula. This eliminates the basis for the provisions in 38 
CFR 21.4280 governing independent study course measurement. To reflect 
these statutory changes, rules dealing with the approval of independent 
study courses are set forth at 38 CFR 21.4267, and 38 CFR 21.4280 is 
removed.
    Pub. L. 102-568 provides that nonaccredited courses not leading to 
a standard college degree will be measured for purposes of determining 
training time the same as for accredited courses that are neither 
leading to a standard college degree nor offered by an institution of 
higher learning. Pub. L. 102-568 also provides that when an institution 
of higher learning offers a course that does not lead to a standard 
college degree, the students' training time will be determined in the 
same manner as for students enrolled in undergraduate courses leading 
to a college degree. 38 CFR 21.4271 is removed and revisions are made 
to 38 CFR 21.4233, 21.4270, and 21.4272 to reflect these statutory 
provisions.
    Prior to the effective date of Pub. L. 102-568, nurse's aide 
courses could not be approved for VA training, and consequently VA 
educational assistance could not be awarded for such training. Pub. L. 
102-568 provides criteria for approving some nurse's aide courses. 
Changes are made to 38 CFR 21.4265 to reflect this statutory change.
    Pub. L. 102-568 changes the criteria for establishing eligibility 
for educational assistance under the Montgomery GI Bill--Active Duty, 
including detailed changes concerning continuous active duty, service 
in the selected reserve, character of service for retirees, and 
voluntarily discharged veterans. Accordingly, changes are made to 38 
CFR 21.7020, 21.7032, 21.7042, 21.7044, 21.7045, and 21.7050 to reflect 
these statutory changes.
    Prior to the effective date of Pub. L. 102-568, a death benefit was 
payable to survivors of participants in the Montgomery GI Bill--Active 
Duty only if the participant died while on active duty. Pub. L. 102-568 
now also permits payment of the death benefit if the participant dies 
within a year of discharge from active duty. Accordingly, revisions are 
made to 38 CFR 21.7280 to reflect this statutory change.
    Pub. L. 102-568 also made changes to 38 U.S.C. 3015 concerning the 
monthly rates of educational assistance which VA is to pay to veterans 
and servicemembers pursuing a full-time program of education under the 
Montgomery GI Bill--Active Duty. The final rule changes these rates in 
38 CFR 21.7136 and 21.7137 to reflect these statutory changes. These 
changes to Secs. 21.7136 and 21.7137 also have the effect of changing 
the rates for part-time training, cooperative training, and 
apprenticeship and other on-job training. 38 U.S.C. 3032 provides 
formulas to determine the monthly rates for those students pursuing 
cooperative training and those in apprenticeships and other on-job 
training. 38 U.S.C. 3015(a) and (b) further state that the monthly 
rates of educational assistance to be paid to part-time students 
receiving benefits under the Montgomery GI Bill--Active Duty is to be 
determined by regulations prescribed by the Secretary of Veterans 
Affairs. The formula for part-time rates was established based on 
proposed and final rule making (see 52 FR 25736, July 8, 1987; 53 FR 
1756, Jan. 22, 1988). Under this formula, monthly rates for three-
quarter-time and one-half-time students have been set at three-quarters 
and one-half of the statutory full-time rate respectively. The monthly 
rates payable for less than one-half-time students are the pro-rated 
amount of their tuition and fees (not to exceed one-half the statutory 
full-time rate for those training less than one-half time and more than 
one-quarter time, and not to exceed one-quarter of the full-time rate 
for those training one-quarter time).
    In addition, this final rule contains an interpretative rule with 
respect to how the statutory requirements for accreditation of an 
independent study course applies when there is a loss of accreditation. 
If an independent study course loses its accreditation (or the 
educational institution offering the course loses its accreditation), 
it is our view that VA is required under the statutes controlling the 
Montgomery GI Bill--Active Duty and Survivors' and Dependents' 
Educational Assistance programs, as amended by Pub. L. 102-568, to 
discontinue payments for such a course effective the date of the loss 
of accreditation. The regulations are amended by adding 38 CFR 
21.4135(x) and 21.7135(z) to accomplish this purpose.
    This final rule also makes nonsubstantive changes for clarity or to 
reflect statutory recodification changes.
    The restatements of statute and statutory interpretations contained 
in this final rule will be applied retroactively from the effective 
dates of the statutory provisions. The dates of application for such 
changes made by this document (and for certain of the nonsubstantive 
changes made for clarity or to reflect statutory recodification 
changes) are as follows:
    October 19, 1984: 38 CFR 21.7020(b)(5), 21.7020(b)(6)(i), and 
21.7020(b)(6)(ii).
    June 30, 1985 (to apply to training received after August 31, 
1993): Sec. 21.7136(a)(2)(ii)(C).
    June 30, 1985 (to apply to training received after September 30, 
1993): Secs. 21.7020(b)(6)(iii), 21.7020(b)(6)(iv), and 21.7072(b).
    October 28, 1986: Secs. 21.7044(a), 21.7044(b)(12), and 21.7050(b).
    December 1, 1988: Sec. 21.7042(c).
    October 23, 1992: Secs. 21.4131(i), 21.4135(aa), 21.7032(a), 
21.7032(f), 21.7042(b), 21.7042(f), 21.7045 (except (a)(1)(i)), 
21.7131(j), 21.7135(aa), 21.7136 introductory text, 21.7136(a)(1) (as 
redesignated), 21.7136(a)(2)(ii)(B) (as redesignated), and 21.7136(f) 
(as redesignated); and the redesignations of paragraphs (a), (b), 
(b)(1), (b)(2), (b)(3), (c), (d), and (e) of Sec. 21.7136.
    October 29, 1992: Secs. 21.3145, 21.4135(a), 21.4135(x), 
21.4234(a), 21.4252(g), 21.4253(a), 21.4254(d), 21.4265(b), 21.4267, 
21.7020(b)(42), 21.7042(a), 21.7120(d), 21.7122(e), 21.7135(a), 
21.7135(z) (as added), 21.7145, 21.7152, 21.7220, 21.7222, and 21.7280; 
the redesignation of Sec. 21.7135(z); and the removal of Sec. 21.4280.
    April 1, 1993: Secs. 21.7136(b) (as redesignated), 21.7136(c) (as 
redesignated), and 21.7137.
    July 1, 1993 (to apply to enrollments for terms, semesters, or 
quarters that begin after June 30, 1993): Secs. 21.4233(b), 21.4270(a), 
21.4270(b), 21.4270(c) 

[[Page 6782]]
footnote 1, 21.4272 introductory text, 21.4272(g), 21.7170, 21.7172(a) 
and 21.7172(d); and the removal of Secs. 21.4271, 21.4272(e), 
21.4272(f), 21.4272(h), and 21.4272(i).
    November 30, 1993: Secs. 21.7044(b)(8) and 21.7045(a)(1)(i).
    The Secretary of Veterans Affairs hereby certifies that this final 
rule 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 final rule merely restates 
statutory changes, sets forth statutory interpretations, and makes 
nonsubstantive changes. Pursuant to 5 U.S.C. 605(b), this final rule, 
therefore, is exempt from the initial and final regulatory flexibility 
analyses requirements of Secs. 603 and 604.
    This final rule has been reviewed by the Office of Management and 
Budget pursuant to the provisions of Executive Order 12866.

    The Catalog of Federal Domestic Assistance numbers for the 
programs affected by this final rule are 64.117 and 64.120.

List of Subjects in 38 CFR Part 21

    Civil rights, Claims, Education, Grant programs-education, Loan 
programs-education, Reporting and recordkeeping requirements, Schools, 
Veterans, Vocational education, Vocational rehabilitation.

    Approved: July 17, 1995.
Jesse Brown,
Secretary of Veterans Affairs.

    For the reasons set out in the preamble, 38 CFR part 21, subparts 
C, D, and K are amended as set forth below.

PART 21--VOCATIONAL REHABILITATION AND EDUCATION

Subpart C--Survivors' and Dependents' Educational Assistance Under 
38 U.S.C. Chapter 35

    1. The authority citation for part 21, subpart C is revised to read 
as follows:

    Authority: 38 U.S.C. 501(a); 38 U.S.C. 3500-3566, unless 
otherwise noted.

    2. In Sec. 21.3145, paragraph (e) is revised to read as follows:


Sec. 21.3145  Work-study allowance.

* * * * *
    (e) Payment in advance. VA will pay in advance an amount equal to 
the lesser of the following:
    (1) 40 percent of the total amount payable under the contract, or
    (2) An amount equal to 50 times the applicable minimum hourly wage 
in effect on the date the contract is signed.

(Authority: 38 U.S.C. 3485, 3537)
* * * * *

Subpart D--Administration of Educational Benefits; 38 U.S.C. 
Chapters 34, 35, and 36

    3. The authority citation for part 21, subpart D is revised to read 
as follows:

    Authority: 38 U.S.C. 501(a); 38 U.S.C. ch. 34, 35, 36, unless 
otherwise noted.

    4. In Sec. 21.4131, paragraph (i) is added, to read as follows:


Sec. 21.4131  Commencing dates.

* * * * *
    (i) Service Members Occupational Conversion and Training Act of 
1992. If the veteran's or eligible person's educational assistance has 
been discontinued because the veteran or eligible person is training 
under a job training program for which benefits are payable to his or 
her employer under the Service Members Occupational Conversion and 
Training Act, VA will determine the date upon which educational 
assistance may be resumed as follows.
    (1) When the veteran or eligible person is pursuing a program of 
education on the last date for which benefits are payable under that 
Act, payments will be resumed on the day following that date.
    (2) When the veteran or eligible person is not pursuing a program 
of education on the last date for which benefits are payable under that 
Act, payments will be resumed on the earliest date otherwise provided 
by this section, but not before the day following the last date for 
which benefits are payable under that Act.

(Authority: Sec. 4492(a), Pub. L. 102-484, 106 Stat. 2765-2766)
* * * * *
    5. In Sec. 21.4135, paragraph (a) is revised; an authority citation 
to paragraph (a) is added; and paragraphs (x) and (aa) and their 
authority citations are added, to read as follows:


Sec. 21.4135  Discontinuance dates. * * *

    (a) Death of veteran or eligible person. (1) If the veteran or 
eligible person receives an advance payment pursuant to 38 U.S.C. 
3680(d) and dies before the period covered by the advance payment ends, 
the discontinuance date of educational assistance shall be the last 
date of the period covered by the advance payment.
    (2) In all other cases if the veteran or eligible person dies while 
pursuing a program of education, the discontinuance date of educational 
assistance shall be the last date of attendance.

(Authority: 38 U.S.C. 3680)
* * * * *
    (x) Independent study course loses accreditation. Except as 
otherwise provided in Sec. 21.4252(g), if the veteran or eligible 
person is enrolled in a course offered in whole or in part by 
independent study, and the course loses its accreditation (or the 
educational institution offering the course loses its accreditation), 
the date of reduction or discontinuance will be the effective date of 
the withdrawal of accreditation by the accrediting agency.

(Authority: 38 U.S.C. 3672, 3676, 3680A(a))
* * * * *
    (aa) Service Members Occupational Conversion and Training Act of 
1992. If an individual enters a training program for the purpose of 
obtaining assistance under the Service Members Occupational Conversion 
and Training Act of 1992, the effective date of discontinuance of 
educational assistance shall be the date on which the individual 
entered the job training program.

(Authority: Sec. 4492(a), Pub. L. 102-484, 106 Stat. 2765-2766)

    6. In Sec. 21.4233, paragraphs (b)(4), (b)(1), (b)(2) and (b)(3) 
are redesignated as paragraphs (b)(1), (b)(2), (b)(3) and (b)(4), 
respectively; paragraph (b)(5) is amended by removing 
``Sec. 21.4270(a), footnote 6'' and adding, in its place, 
``Sec. 21.4270(b)''; and newly redesignated paragraphs (b)(1) and 
(b)(2) are revised, to read as follows:


Sec. 21.4233  Combination. * * *

    (b) Concurrent enrollment. * * *
    (1) If VA measures the courses pursued at both institutions on 
either a clock-hour basis or a credit-hour basis, VA will measure the 
veteran's or eligible person's enrollment by adding together the units 
of measurement in the second school to the units of measurement for the 
courses in the primary institution. The standard for full time will be 
the full-time standard for the courses at the primary institution.
    (2) Where the standards for measurement of the courses pursued 
concurrently in the two schools are different, VA will measure the 
veteran's or eligible person's enrollment by converting the units of 
measurement for courses in the second school to the equivalent in value 
expressed in units of measurement required for the courses in the 
program of education which the veteran or eligible person is pursuing 
at the primary institution.

(Authority: 38 U.S.C. 3688)
* * * * * 

[[Page 6783]]

    7. In Sec. 21.4234, paragraphs (a)(2)(ii) and (a)(2)(iii) are 
revised, and paragraph (a)(2)(iv) is added, to read as follows:


Sec. 21.4234  Change of program.

    (a) Definition. * * *
    (2) * * *
    (ii) A change in the individual's educational, professional or 
vocational objective following the successful completion of the 
immediately preceding program of education,
    (iii) A return to the individual's prior program of education 
following a change of program if the individual resumes training in the 
program without any loss of credit or standing in that program, or
    (iv) An enrollment in a new program of education when that program 
leads to a vocational, educational or professional objective in the 
same general field as the immediately preceding program of education.

(Authority: 38 U.S.C. 3691)
* * * * *
    8. In Sec. 21.4252, paragraph (g) and its authority citation are 
added, to read as follows:


Sec. 21.4252  Courses precluded.

* * * * *
    (g) Independent study. (1) Effective October 29, 1992, VA may pay 
educational assistance to a veteran who is enrolled in a nonaccredited 
course or unit subject offered entirely or partly by independent study 
only if--
    (i) Successful completion of the nonaccredited course or unit 
subject is required in order for the veteran to complete his or her 
program of education; and the veteran--
    (A) Was receiving educational assistance on October 29, 1992, for 
pursuit of the program of education of which the nonaccredited 
independent study course or unit subject forms a part, and
    (B) Has remained continuously enrolled in that program of education 
from October 29, 1992, to the date the veteran enrolls in the 
nonaccredited independent study course or unit subject; or
    (ii) Was enrolled in and receiving educational assistance for the 
nonaccredited independent study course or unit subject on October 29, 
1992, and remains continuously enrolled in that course or unit subject.
    (2) Whether or not the veteran is enrolled will be determined by 
the regularly prescribed standards and practices of the educational 
institution.

(Authority: 38 U.S.C. 3680A; sec. 313(b), Pub. L. 102-568, 106 Stat. 
4331-4332)
* * * * *
    9. In Sec. 21.4253, paragraph (a)(3) is revised and paragraph 
(a)(5) and an authority citation for paragraph (a) are added, to read 
as follows:


Sec. 21.4253  Accredited courses.

    (a) General. * * *
    (3) The course is conducted under the Act of February 23, 1917 (20 
U.S.C. 11 et seq.).
* * * * *
    (5) The course is approved by the State as meeting the requirement 
of regulations prescribed by the Secretary of Health and Human Services 
under sections 1819(f)(2)(A)(i) and 1919(f)(2)(A)(i) of the Social 
Security Act (42 U.S.C.1395i-3(f)(2)(A)(i) and 1396r(f)(2)(A)(i)).

(Authority: 38 U.S.C. 3675(a))
* * * * *
    10. In Sec. 21.4254, paragraph (d) and its authority citation are 
added, to read as follows:


Sec. 21.4254  Nonaccredited courses.

* * * * *
    (d) Limitations on course approval. Notwithstanding any other 
provision of this section, a State approving agency shall not approve a 
nonaccredited course if it is to be pursued in whole or in part by 
independent study.

(Authority: 38 U.S.C. 3676(e))

    11. In Sec. 21.4265, paragraph (b)(3) is revised and an authority 
citation is added, to read as follows:


Sec. 21.4265  Practical training approved as institutional training or 
on-job training.

* * * * *
    (b) Nursing courses.
* * * * *
    (3) Except for enrollment in a nurse's aide course approved 
pursuant to Sec. 21.4253(a)(5), VA shall not approve an enrollment in a 
nonaccredited nursing course which does not meet the licensing 
requirements of the State where the course is offered.

(Authority: 38 U.S.C. 3452, 3688)
* * * * *
    12. In subpart D, a new Sec. 21.4267 and its authority citations 
are added, to read as follows:


Sec. 21.4267  Approval of independent study.

    (a) Overview. Except as provided in Secs. 21.4252(g), 21.7120(c), 
and 21.7622(f), VA may not pay educational assistance for a 
nonaccredited course which is offered in whole or in part by 
independent study. Hence, it is necessary to differentiate independent 
study from similar courses.

(Authority: 38 U.S.C. 3014, 3672, 3676(e), 3680A(a))

    (b) Definition of independent study. (1) VA considers a course to 
be offered entirely by independent study when--
    (i) It consists of a prescribed program of study with provision for 
interaction either by mail, telephone, or personally between the 
student and the regularly employed faculty of the university or 
college;
    (ii) It is offered without any regularly scheduled, conventional 
classroom or laboratory sessions; and
    (iii) It is not a course listed in paragraph (c), (d), or (e) of 
this section.
    (2) VA considers a course to be offered in part by independent 
study when--
    (i) It is an undergraduate course;
    (ii) It is not classified as one of the three types of courses 
listed in paragraph (c) of this section;
    (iii) It has some weeks when standard class sessions are scheduled; 
and
    (iv) It consists of independent study as defined in paragraph 
(b)(1) of this section during those weeks when there are no regularly 
scheduled class sessions.

(Authority: 38 U.S.C. 3676(e), 3680A(a))

    (c) Scope of independent study. VA does not consider any of the 
following courses to be courses offered by independent study.
    (1) A cooperative course as defined in Sec. 21.4233(a);
    (2) A farm cooperative course; or
    (3) A course approved as a correspondence course.

(Authority: 38 U.S.C. 3676(e), 3680A(a))

    (d) Undergraduate resident training. VA considers the following 
undergraduate courses to be resident training.
    (1) A course which meets the requirements for resident 
institutional training found in Sec. 21.4265(f);
    (2) A course which requires regularly scheduled, standard class 
sessions at least once every two weeks and which has a total number of 
class sessions equal to the number of credit hours awarded for the 
course, times the number of weeks in a standard quarter or semester, as 
applicable;
    (3) A course of student teaching; and
    (4) Flight training which is an integral part of a standard 
undergraduate college degree.
    (e) Graduate resident training. VA considers a graduate course to 
be resident training if the course--
    (1) Is offered through regularly scheduled, conventional classroom 
or laboratory sessions; or
    (2) Consists of research (either on campus or in absentia) 
necessary for the preparation of the student's--

[[Page 6784]]

    (i) Master's thesis,
    (ii) Doctoral dissertation, or
    (iii) Similar treatise which is prerequisite to the degree being 
pursued; or
    (3) Consists of a combination of training as described in 
paragraphs (e)(1) and (e)(2) of this section.

(Authority: 38 U.S.C. 3676(e), 3680A(a))

    13. In Sec. 21.4270, paragraphs (a) and (b) and footnote 1 to the 
table in paragraph (c) are revised, to read as follows:


Sec. 21.4270  Measurement of courses.

    (a) Measurement of trade, technical, and high school courses. 
Trade, technical, high school, and high school preparatory courses 
shall be measured as stated in this paragraph.
    (1) Trade and technical courses. (i) Except as provided in 
paragraph (b) of this section, if shop practice is an integral part of 
a trade or technical course not leading to a standard college degree--
    (A) A full-time enrollment is 22 clock hours per week (exclusive of 
supervised study) with not more than 2\1/2\ hours rest period 
allowance;
    (B) A three-quarter-time enrollment is 16 through 21 clock hours 
per week (exclusive of supervised study) with not more than 2 hours 
rest period allowance;
    (C) A one-half-time enrollment is 11 through 15 clock hours per 
week (exclusive of supervised study) with not more than 1\1/4\ hours 
rest period allowance;
    (D) A less than one-half-time but more than one-quarter-time 
enrollment is 6 through 10 clock hours per week (exclusive of 
supervised study) with not more than \3/4\ hour rest period allowance; 
and
    (E) A quarter-time enrollment is 1 through 5 clock hours per week 
(exclusive of supervised study).
    (ii) Except as provided in paragraph (b) of this section, if theory 
and class instruction constitute more than 50 percent of the required 
hours in a trade or technical course not leading to a standard college 
degree, enrollments will be measured as follows. In measuring net 
instruction there will be included customary intervals not to exceed 10 
minutes between classes. Shop practice and rest periods are excluded. 
Supervised instruction periods in a school's shops and the time 
involved in field trips and group instruction may be included in 
computing the clock hour requirements.
    (A) A full-time enrollment is 18 clock hours net instruction per 
week (exclusive of supervised study);
    (B) A three-quarter-time enrollment is 13 through 17 clock hours 
net instruction per week (exclusive of supervised study);
    (C) A one-half-time enrollment is 9 through 12 clock hours net 
instruction per week (exclusive of supervised study);
    (D) A less than one-half-time but more than one-quarter-time 
enrollment is 5 through 8 clock hours net instruction per week 
(exclusive of supervised study); and
    (E) A quarter-time enrollment is 1 through 4 clock hours net 
instruction per week (exclusive of supervised study).
    (2) High school courses. If a student is pursuing high school 
courses at a rate which would result in an accredited high school 
diploma in four ordinary school years, VA considers him or her to be 
enrolled full time. Otherwise, for high school enrollments, training 
time will be determined as follows. (For the purpose of this paragraph, 
a unit is not less than one hundred and twenty 60-minute hours or the 
equivalent of study in any subject in one academic year.)
    (i) A full-time enrollment is 18 clock hours net instruction per 
week or four units per year or the equivalent;
    (ii) A three-quarter-time enrollment is 13 through 17 clock hours 
net instruction per week or three units per year or the equivalent;
    (iii) A one-half-time enrollment is 9 through 12 clock hours net 
instruction per week or two units per year or the equivalent;
    (iv) A less than one-half-time but more than one-quarter-time 
enrollment is 5 through 8 clock hours net instruction per week or one 
unit per year or the equivalent; and
    (v) A one-quarter-time enrollment is 1 through 4 clock hours net 
instruction per week.
    (3) Elementary school. For a high school preparatory course pursued 
at the elementary school level--
    (i) A full-time enrollment is 18 clock hours net instruction per 
week;
    (ii) A three-quarter-time enrollment is 13 through 17 clock hours 
net instruction per week;
    (iii) A one-half-time enrollment is 9 through 12 clock hours net 
instruction per week;
    (iv) A less than one-half-time but more than one-quarter-time 
enrollment is 5 through 8 clock hours net instruction per week; and
    (v) A one-quarter-time enrollment is 1 through 4 clock hours per 
week.

(Authority: 38 U.S.C. 3688(a))

    (b) Measurement of non-college degree courses offered by 
institutions of higher learning. (1) Notwithstanding the provisions of 
paragraph (a)(1) of this section, if a student is enrolled in a course 
which is not leading to a standard college degree and which is offered 
by an institution of higher learning, VA will measure his or her 
enrollment in the same manner as collegiate undergraduate courses are 
measured according to the provisions of paragraph (c) of this section.
    (2) Notwithstanding the provisions of paragraph (a)(1) of this 
section, if a student is enrolled in a course not leading to a standard 
college degree which is offered on a standard quarter- or semester-hour 
basis by an educational institution which is not an institution of 
higher learning, VA shall measure his or her enrollment in the same 
manner as collegiate undergraduate courses are measured according to 
the provisions of paragraph (c) of this section, provided that the 
educational institution requires at least the same minimum number of 
hours of weekly attendance as are required by paragraph (a)(1) of this 
section for courses offered on a clock-hour basis. If the educational 
institution does not require at least the same minimum number of hours 
of weekly attendance as are required in paragraph (a)(1) of this 
section, VA will not apply the provisions of paragraph (c) of this 
section, but will measure the course according to the criteria in 
paragraph (a)(1) of this section.

(Authority: 38 U.S.C. 3688(a)(7))

    (c) Collegiate graduate, professional and on-the-job training 
courses. * * *

    \1\ Cooperative courses may be measured on a full-time basis 
only.

* * * * *
    14. Section 21.4271 is removed and reserved.
    15. In Sec. 21.4272, paragraphs (e), (f), (h), and (i) are removed 
and reserved; and the introductory text and paragraph (g)(3) are 
revised, to read as follows:


Sec. 21.4272  Collegiate course measurement.

    VA will measure a college level course in an institution of higher 
learning on a credit-hour basis provided all the conditions under 
paragraph (a) or (b) of this section are met. See also Sec. 21.4273.

(Authority: 38 U.S.C. 3688)
* * * * *
    (g) Course measurement; nonstandard terms. * * *
    (3) The quotient resulting from the use of the formula is called 
equivalent credit hours. VA treats equivalent credit hours as credit 
hours for measurement purposes.


[[Page 6785]]

(Authority: 38 U.S.C. 3688(b))
* * * * *
    16. Section 21.4280 is removed and reserved.

Subpart K--All Volunteer Force Educational Assistance Program (New 
GI Bill)

    17. The authority citation for part 21, subpart K is revised to 
read as follows:

    Authority: 38 U.S.C. 501(a); 38 U.S.C. ch. 30, unless otherwise 
noted.

    18. In Sec. 21.7020, paragraphs (b)(5) and (b)(6) are revised, and 
paragraph (b)(42) is added, to read as follows:


Sec. 21.7020  Definitions.

* * * * *
    (b) Other definitions. * * *
    (5) Break in service. (i) Except as provided in paragraph 
(b)(5)(ii) of this section, the term break in service means a period of 
more than 90 days between the date when an individual is released from 
active duty or otherwise receives a complete separation from active 
duty service and the date he or she reenters on active duty.
    (ii) A period during which an individual is assigned full time by 
the Armed Forces to a civilian institution for a course of education 
substantially the same as established courses offered to civilians is 
not a break in service.

(Authority: 38 U.S.C. 3011, 3021)

    (6) Continuous active duty. (i) The term continuous active duty 
means active duty served without interruption. An interruption in 
service will only be found when the individual receives a complete 
separation from active duty.
    (ii) A period during which an individual on active duty is assigned 
full time by the Armed Forces to a civilian institution for a course of 
education substantially the same as established courses offered to 
civilians will not interrupt the continuity of the individual's active 
duty.
    (iii) If an individual, during his or her initial obligated period 
of active-duty service, is separated from active duty to pursue a 
course of education at a service academy or a post-secondary school 
preparatory to enrollment at a service academy, no interruption in 
service will be found and the individual's service will be considered 
continuous active-duty service, provided he or she--
    (A) Commences pursuit of a course of education at a service academy 
or post-secondary school,
    (B) Fails to complete the course of education, and
    (C) Immediately reenters on a period of active duty.
    (iv) An individual who is discharged or released from active duty 
for a reason stated in paragraph (b)(6)(iv) of this section after 
serving not more than 12 months of his or her initial obligated period 
of active duty, and who subsequently reenlists or reenters on a period 
of active duty, will not be considered to have an interruption in 
service. Except as provided in paragraph (b)(6)(v) of this section, the 
individual's service during the two periods will be considered 
continuous active-duty service for the aggregate length of the two 
service periods. However, the individual's discharge or release from 
the initial obligated period of service must have been:
    (A) For a service-connected disability,
    (B) For a medical condition which preexisted such active-duty 
service and is not service connected,
    (C) For a physical or mental condition not characterized as a 
disability and not resulting from the individual's own willful 
misconduct which interfered with the individual's performance of duty 
as determined by the Secretary concerned, or
    (D) Involuntary, for the convenience of the Government as a result 
of a reduction in force as determined by the Secretary concerned.
    (v) If the second period of active-duty service referred to in 
paragraph (b)(6)(iv) of this section is of such nature or character 
that, when aggregated with the initial period of service referred to in 
that paragraph, it would cause the individual to be divested of 
entitlement to educational assistance otherwise established by the 
initial period of active duty, the two periods of service will not be 
aggregated and will not be considered a single period of continuous 
active duty.
    (vi) Time lost will not be considered to interrupt the continuity 
of service. For the purpose of this section, ``time lost'' includes 
excess leave, noncreditable time and not-on-duty time.

(Authority: 38 U.S.C. 3011, 3012)
* * * * *
    (42) Continuously enrolled. The term continuously enrolled means 
being in an enrolled status at an educational institution for each day 
during the school year, and for consecutive school years. Continuity of 
enrollment is not broken by holiday vacations; vacation periods; 
periods during the school year between terms, quarters, or semesters; 
or by nonenrollment during periods of enrollment outside the school 
year (e.g., summer sessions).

(Authority: Sec. 313(b), Pub. L. 102-568, 106 Stat. 4333)

    19. In Sec. 21.7032, paragraph (a) and its authority citation are 
revised and paragraph (f) and its authority citation are added, to read 
as follows:


Sec. 21.7032  Time limits.

    (a) Scope of this section. The provisions of this section are 
applicable to original applications, formal or informal; to reopened 
claims; and, to the extent indicated in paragraph (f) of this section, 
to elections to receive educational assistance under 38 U.S.C. chapter 
30.

(Authority: 38 U.S.C. 3018B, 3034(a), 3471)
* * * * *
    (f) Time limit for completing certain elections. An individual who 
seeks to establish eligibility to receive educational assistance under 
Sec. 21.7045 must--
    (1) Within one year of the date of the VA letter or other written 
notice to the individual indicating that additional evidence is needed 
in order to complete the claim, submit that evidence to VA. This time 
limit may be extended if the individual is able to show good cause for 
an extension of the period to the date on which he or she actually 
submits the additional evidence; and
    (2) Submit the $1,200 VA is required pursuant to Sec. 21.7045(c)(2) 
to collect before educational assistance can be awarded. A delay in 
submitting the $1,200 may result in a later effective date for the 
award to the individual, and in no event will VA accept payment of the 
$1,200 from the individual after the last date of eligibility as 
determined by Sec. 21.7050 or Sec. 21.7051. See Sec. 21.7131(k).

(Authority: 38 U.S.C. 3018B)

    20. In Sec. 21.7042, the introductory text of paragraph (b)(7)(i) 
is amended by removing ``as'' and adding, in its place, ``a'' and by 
removing ``relesed'' and adding, in its place, ``released''; the 
introductory text of paragraph (c)(3)(ii) is amended by removing ``the 
individual is'' and adding, in its place, ``have been''; paragraph 
(f)(1) is amended by removing ``in Sec. 21.7045(b)'' and adding, in its 
place, ``in Sec. 21.7045(b) or (c)''; and the introductory text of 
paragraph (a)(3) is revised, paragraph (a)(6) and its authority 
citation and paragraph (b)(7)(iii) are added, the introductory text of 
paragraph (c)(3) is revised, paragraphs (c)(3)(i), (c)(3)(iii)(A), and 
(c)(3)(iii)(B) are revised, and paragraph (c)(3)(iii)(C) is added, to 
read as follows:


Sec. 21.7042  Basic eligibility requirements.

* * * * *
    (a) Eligibility based solely on active duty. * * *
    (3) Except as provided in paragraph (a)(6) of this section, the 
individual before completing the service 

[[Page 6786]]
requirements of this paragraph must either--
* * * * *
    (6) An individual who does not meet the requirements of paragraph 
(a)(3) of this section nevertheless is eligible for basic educational 
assistance if he or she--
    (i) Was on active duty on August 2, 1990, and
    (ii) Completes the requirements of a secondary school diploma (or 
an equivalency certificate) before October 29, 1994.

(Authority: 38 U.S.C. 3011)

    (b) Eligibility based on active duty service and service in the 
Selected Reserve. * * *
    (7) * * *
    (iii) Before completing four years service in the Selected Reserve, 
the individual ceases to be a member of the Selected Reserve during the 
period beginning on October 1, 1991, and ending on September 30, 1999, 
by reason of the inactivation of the individual's unit of assignment or 
by reason of involuntarily ceasing to be designated as a member of the 
Selected Reserve pursuant to 10 U.S.C. 268(b). However, this exemption 
from the four-year service requirement does not apply to a reservist 
who ceases to be a member of the Selected Reserve under adverse 
conditions as characterized by the Secretary of the military department 
concerned, or to a reservist who after having involuntarily ceased to 
be a member of the Selected Reserve is involuntarily separated from the 
Armed Forces under adverse conditions as characterized by the Secretary 
of the military department concerned.

(Authority: 10 U.S.C. 16133(b)(1); 38 U.S.C. 3012(b)(1)(B); sec. 
4421(b) and (c), Pub. L. 102-484, 106 Stat. 2718)
* * * * *
    (c) Eligibility based on withdrawal of election not to enroll. * * 
*
    (3) The individual must:
    (i) Complete the period of service that he or she was obligated to 
serve on December 1, 1988, which will include completion of a period of 
extension or reenlistment if an individual's initial obligated period 
of service was scheduled to end after November 30, 1988, but he or she 
extended an enlistment or reenlisted before December 1, 1988; or
* * * * *
    (iii) * * *
    (A) Discharged or released from active duty for the convenience of 
the Government after completing not less than 20 months of that period 
of service if such period was less than three years, or 30 months, if 
that period was at least three years;
    (B) Involuntarily discharged or released from active duty for the 
convenience of the Government as a result of a reduction in force as 
determined by the Secretary concerned in accordance with regulations 
prescribed by the Secretary of Defense; or
    (C) Discharged or released from active duty for a physical or 
mental condition that was not characterized as a disability and did not 
result from the individual's own willful misconduct but did interfere 
with the individual's performance of duty, as determined by the 
Secretary of the military department concerned in accordance with 
regulations prescribed by the Secretary of Defense (or by the Secretary 
of Transportation for the Coast Guard when the Coast Guard is not 
operating as a service of the Navy).
* * * * *
    21. In Sec. 21.7044, paragraph (a)(3)(ii) is amended by removing 
``degree. This may be done at any time.'' and adding, in its place, 
``degree, which may be done at any time;'' paragraph (a)(4)(i)(E) is 
amended by removing ``or;'' and adding, in its place, ``or''; paragraph 
(a)(4)(i)(F) is amended by removing ``Navy.'' and adding, in its place, 
``Navy;'' and paragraph (a)(4)(i)(F) is further amended by removing its 
authority citation; paragraph (a)(5)(iv) is amended by removing 
``service;'' and adding, in its place, ``service; and''; and the 
heading, paragraph (a)(6), the authority citation for paragraph (a), 
and paragraph (b)(8)(ii)(B) are revised, and paragraphs (b)(8)(iii) and 
(b)(12) and their authority citations are added, to read as follows:


Sec. 21.7044  Persons with 38 U.S.C. ch. 34 eligibility.

* * * * *
    (a) Eligibility based solely on active duty. * * *
    (6) The individual must have been on active duty at any time during 
the period beginning on October 19, 1984, and ending on July 1, 1985, 
and continued on active duty without a break in service.

(Authority: 38 U.S.C. 3011)

    (b) Eligibility based on combined active duty service and service 
in the Selected Reserve. * * *
    (8) * * *
    (ii) * * *
    (B) For a medical condition which preexisted that period of active 
duty and which VA determines is not service connected, or
    (iii) Before completing four years service in the Selected Reserve 
the individual ceases to be a member of the Selected Reserve during the 
period beginning on October 1, 1991, and ending on September 30, 1999, 
by reason of the inactivation of the individual's unit of assignment or 
by reason of involuntarily ceasing to be designated as a member of the 
Selected Reserve pursuant to 10 U.S.C. 268(b). However, this exemption 
from the four years service requirement does not apply to a reservist 
who ceases to be a member of the Selected Reserve under adverse 
conditions as characterized by the Secretary of the military department 
concerned, or to a reservist who after having involuntarily ceased to 
be a member of the Selected Reserve is involuntarily separated from the 
Armed Forces under adverse conditions as characterized by the Secretary 
of the military department concerned.

(Authority: 10 U.S.C. 16133(b)(1); sec. 4421(b) and (c), Pub. L. 
102-484, 106 Stat. 2718)
* * * * *
    (12) The individual must have been on active duty at any time 
during the period beginning on October 19, 1984, and ending on July 1, 
1985, and continued on active duty without a break in service.

(Authority: 38 U.S.C. 3012(a)(1)(B))
* * * * *
    22. Section 21.7045 is revised to read as follows:


Sec. 21.7045  Eligibility based on involuntary separation or voluntary 
separation.

    An individual who fails to meet the eligibility requirements found 
in Sec. 21.7042 or Sec. 21.7044 nevertheless will be eligible for 
educational assistance as provided in subpart K of this part if he or 
she meets the requirements of paragraph (a) and either paragraph (b) or 
(c) of this section.
    (a) Service requirements. The individual must meet one of the 
following sets of service requirements.
    (1) The individual must--
    (i) Be on active duty or full-time National Guard duty either on 
September 30, 1990, or on or after November 30, 1993, and
    (ii) After February 2, 1991, be involuntarily separated, as that 
term is defined in 10 U.S.C. 1141, with an honorable discharge; or
    (2) The individual must--
    (i) Be separated from active military, naval, or air service with 
an honorable discharge, and
    (ii) Receive voluntary separation incentives under 10 U.S.C. 1174a 
or 1175.

(Authority: 38 U.S.C. 3018A)


[[Page 6787]]

    (b) Additional requirements for those individuals voluntarily 
separated after October 22, 1992, or involuntarily separated. An 
individual who meets the requirements of paragraph (a)(1) of this 
section, or an individual who meets the requirements of paragraph 
(a)(2) of this section and was separated after October 22, 1992, must 
meet the following additional requirements in order to establish 
eligibility for educational assistance.
    (1) Required election. (i) If, under Sec. 21.7042(f), the 
individual elected not to receive educational assistance under 38 
U.S.C. ch. 30, he or she must irrevocably withdraw that election and 
make an election to receive educational assistance under 38 U.S.C. ch. 
30. The withdrawal and the election must be made:
    (A) Before the involuntary or voluntary separation as the case may 
be, and
    (B) Pursuant to procedures which the Secretary of the military 
department concerned provides in accordance with regulations prescribed 
by the Secretary of Defense or which the Secretary of Transportation 
provides with respect to the Coast Guard when it is not operating as a 
service in the Navy; and
    (ii) If the individual is a participant (as defined in 
Sec. 21.5021(e)) in the educational program provided in 38 U.S.C. ch. 
32, the individual must make an irrevocable election to receive 
educational assistance under 38 U.S.C. ch. 30 rather than under 38 
U.S.C. ch. 32. Such an election must be made:
    (A) Before the individual is involuntarily or voluntarily separated 
as the case may be, and
    (B) Pursuant to procedures which the Secretary of the military 
department concerned provides in accordance with regulations prescribed 
by the Secretary of Defense or which the Secretary of Transportation 
provides with respect to the Coast Guard when it is not operating as a 
service in the Navy; or
    (iii) If the individual is not described in either paragraph 
(b)(1)(i) or (b)(1)(ii) of this section, he or she must make an 
irrevocable election to receive educational assistance under 38 U.S.C. 
ch. 30. This election must be made:
    (A) Before the individual is involuntarily or voluntarily separated 
as the case may be, and
    (B) Pursuant to procedures which the Secretary of the military 
department concerned provides in accordance with regulations prescribed 
by the Secretary of Defense or which the Secretary of Transportation 
provides with respect to the Coast Guard when it is not operating as a 
service in the Navy.
    (2) Reduction in basic pay. The basic pay of anyone who makes one 
of the irrevocable elections described in paragraph (b)(1) of this 
section is required by 38 U.S.C. 3018B to be reduced by $1,200.
    (i) If for any reason the basic pay of an individual who received 
an involuntary separation is not so reduced by $1,200, the failure to 
make the reduction will not affect the individual's eligibility for 
educational assistance under 38 U.S.C. ch. 30.
    (ii) If the individual is voluntarily separated, such reduction of 
the individual's basic pay by $1,200 is a precondition to establishing 
eligibility. Hence, educational assistance under 38 U.S.C. ch. 30 may 
not be paid to such an individual when the reduction does not occur.
    (3) Educational requirement. (i) Before the date on which VA 
receives the individual's application for educational assistance under 
subpart K of this part, the individual must have successfully completed 
either:
    (A) The requirements of a secondary school diploma (or equivalency 
certificate), or
    (B) 12 semester hours (or the equivalent) in a program of education 
leading to a standard college degree.
    (ii) If a veteran's application for educational assistance is 
denied due to failure to meet the requirements of paragraph (b)(3)(i) 
of this section at the time of his or her application for educational 
assistance, the veteran may reapply if the requirements are 
subsequently met.

(Authority: 38 U.S.C. 3018B)

    (c) Additional requirements for individuals who are voluntarily 
discharged before October 23, 1992. If an individual meets the 
requirements of paragraph (a)(2) of this section and is voluntarily 
discharged before October 23, 1992, he or she must also meet the 
following requirements in order to establish eligibility for 
educational assistance.
    (1) Required election. (i) If, under Sec. 21.7042(f), the 
individual elected not to receive educational assistance under 38 
U.S.C. ch. 30, he or she must irrevocably withdraw that election and 
make an election to receive educational assistance under 38 U.S.C. ch. 
30. The withdrawal and the new election must be made:
    (A) Before October 23, 1993, and
    (B) In the form and manner prescribed by the Secretary of Veterans 
Affairs; and
    (ii) If the individual is a participant (as defined in 
Sec. 21.5021(e)) in the educational program provided in 38 U.S.C. ch. 
32, the individual must make an irrevocable election to receive 
educational assistance under 38 U.S.C. ch. 30 rather than under 38 
U.S.C. ch. 32. Such an election must be made:
    (A) Before October 23, 1993, and
    (B) In the form and manner prescribed by the Secretary of Veterans 
Affairs.
    (iii) If the individual is not described in either paragraph 
(c)(1)(i) or (ii) of this section, he or she must make an irrevocable 
election to receive educational assistance under 38 U.S.C. ch. 30. This 
election must be made:
    (A) Before October 23, 1993, and
    (B) In the form and manner prescribed by the Secretary of Veterans 
Affairs.
    (2) $1,200 collection. VA must collect $1,200 from the individual 
before awarding educational assistance under 38 U.S.C. ch. 30. 
Collection of $1,200 is a precondition to establishing eligibility.
    (3) Educational requirement. (i) Before the date on which VA 
receives the individual's application for educational assistance under 
subpart K of this part, the individual must have successfully completed 
either:
    (A) The requirements of a secondary school diploma (or equivalency 
certificate), or
    (B) 12 semester hours (or the equivalent) in a program of education 
leading to a standard college degree.
    (ii) If a veteran's application for educational assistance under 
subpart K of this part is denied due to failure to meet the 
requirements of paragraph (c)(3)(i) of this section at the time of his 
or her application for educational assistance, the veteran will be 
permitted to apply at a later date.

(Authority: 38 U.S.C. 3018B)


Sec. 21.705  [Amended]

    23. Section 21.7050(b)(1) is amended by removing ``October 18, 
1984'' and adding, in its place, ``June 30, 1985''.
    24. In Sec. 21.7072, paragraph (b) heading, paragraph (b)(1) 
introductory text, and the authority citation for paragraph (b)(1) are 
revised, to read as follows:


Sec. 21.7072  Entitlement to basic educational assistance.

* * * * *
    (b) Entitlement: individual discharged for service-connected 
disability, a medical condition which preexisted service, hardship, or 
involuntarily for the convenience of the Government as a result of a 
reduction in force. (1) Except as provided in Sec. 21.7073, when the 
provisions of paragraph (b) of this section are met, an eligible 
individual is entitled to one month of basic educational assistance (or 
equivalent thereof in part-time basic educational assistance) for each 
month of the 

[[Page 6788]]
individual's continuous active duty service that is after June 30, 
1985, and that, in the case of an individual who had no previous 
eligibility under 38 U.S.C. ch. 34, is part of the individual's initial 
obligated period of active duty. In the case of a veteran to whom the 
definition of continuous active duty found in either 
Sec. 21.7020(b)(6)(iii) or Sec. 21.7020(b)(6)(iv) applies, the length 
of the continuous active duty will be the aggregate length of the 
periods of active duty referred to in those paragraphs. Except as 
provided in Sec. 21.7073, VA will apply paragraph (b) of this section 
when the individual:
* * * * *
(Authority: 38 U.S.C. 3011(f), 3013(a))
* * * * *
    25. In Sec. 21.7120, paragraph (d) and its authority citation are 
added, to read as follows:


Sec. 21.7120  Courses included in programs of education.

* * * * *
    (d) Independent study. (1) Except as provided in paragraph (d)(2) 
of this section, effective October 29, 1992, VA may pay educational 
assistance to a veteran or servicemember who is enrolled in a 
nonaccredited course or unit subject offered entirely or partly by 
independent study only if--
    (i) Successful completion of the nonaccredited course or unit 
subject is required in order for the veteran or servicemember to 
complete his or her program of education,
    (ii) On October 29, 1992, the veteran or servicemember was 
receiving educational assistance for pursuit of the program of 
education of which the nonaccredited independent study course or unit 
subject forms a part, and
    (iii) The veteran or servicemember has remained continuously 
enrolled in the program of education of which the nonaccredited 
independent study course or unit subject forms a part from October 29, 
1992, to the date of enrollment by the veteran or servicemember in the 
nonaccredited independent study course or unit subject.
    (2) Notwithstanding the provisions of paragraph (d)(1) of this 
section, VA may pay educational assistance to a veteran or 
servicemember for enrollment in a course or unit subject offered by 
independent study which, though part of an approved program of 
education, is not required in order for the veteran or servicemember to 
complete the program of education (i.e., an elective) when--
    (i) The veteran or servicemember was enrolled in and receiving 
educational assistance for the course or unit subject on October 29, 
1992, and
    (ii) The veteran or servicemember remains continuously enrolled in 
the course or unit subject.
    (3) Whether or not the veteran or servicemember is enrolled will be 
determined by the regularly prescribed standards and practices of the 
educational institution offering the course or unit subject.

(Authority: 38 U.S.C. 3014, 3034, 3076, 3680A(a); sec. 313(b), Pub. 
L. 102-568, 106 Stat. 4333)

    26. In Sec. 21.7122, paragraphs (e)(5) and (e)(6) and the authority 
citation for paragraph (e) are revised, and paragraph (e)(7) is added, 
to read as follows:


Sec. 21.7122  Courses precluded.

* * * * *
    (e) Other courses. * * *
    (5) Except as provided in Sec. 21.4252(j), a course from which the 
veteran or servicemember withdrew without mitigating circumstances,
    (6) An enrollment in a course offered by a proprietary school when 
the veteran or servicemember is an official of the school authorized to 
sign certificates of enrollment or monthly certificates of attendance 
or monthly certifications of pursuit, an owner of the school, or an 
operator of the school, or
    (7) Except as provided in Sec. 21.7120(d), an enrollment in a 
nonaccredited independent study course.

(Authority: 38 U.S.C. 3002(3), 3034, 3672(a), 3676, 3680(a), 
3680A(a))

    27. In Sec. 21.7131, paragraph (j) is added, to read as follows:


Sec. 21.7131  Commencing dates.

* * * * *
    (j) Service Members Occupational Conversion and Training Act of 
1992. If the veteran's educational assistance has been discontinued 
because the veteran is training under a job training program for which 
benefits are payable to his or her employer under the Service Members 
Occupational Conversion and Training Act of 1992, VA will determine the 
date upon which educational assistance may be resumed as follows.
    (1) When the veteran is pursuing a program of education on the last 
date for which benefits are payable under that Act, payments will be 
resumed on the day following that date.
    (2) When the veteran is not pursuing a program of education on the 
last date for which benefits are payable under that Act, payments will 
be resumed on the commencing date as determined by paragraphs (a) 
through (i) of this section, but not before the day following the last 
date for which benefits are payable under that Act.

(Authority: Sec. 4492(a), Pub. L. 102-484, 106 Stat. 2765-2766)

    28. In Sec. 21.7135, paragraph (z) is redesignated as paragraph 
(bb); and paragraph (a) and its authority citation are revised, and 
paragraphs (z) and (aa) and their authority citations are added, to 
read as follows:


Sec. 21.7135  Discontinuance dates.

* * * * *
    (a) Death of veteran or servicemember. (1) If the veteran or 
servicemember receives an advance payment pursuant to 38 U.S.C. 3680(d) 
and dies before the period covered by the advance payment ends, the 
discontinuance date of educational assistance shall be the last date of 
the period covered by the advance payment.
    (2) In all other cases if the veteran or servicemember dies while 
pursuing a program of education, the discontinuance date of educational 
assistance shall be the last date of attendance.

(Authority: 38 U.S.C. 3014, 3023, 3680)
* * * * *
    (z) Independent study course loses accreditation. Except as 
otherwise provided in Sec. 21.7120(d), if the veteran or servicemember 
is enrolled in a course offered in whole or in part by independent 
study, and the course loses its accreditation (or the educational 
institution offering the course loses its accreditation), the date of 
reduction or discontinuance will be the effective date of the 
withdrawal of accreditation by the accrediting agency.

(Authority: 38 U.S.C. 3014, 3034, 3676, 3680A(a))

    (aa) Service Members Occupational Conversion and Training Act of 
1992. If a veteran enters a training program for the purpose of 
obtaining assistance under the Service Members Occupational Conversion 
and Training Act of 1992, the effective date of discontinuance of 
educational assistance shall be the date on which the veteran entered 
the job training program.

(Authority: Sec. 4492(a), Pub. L. 102-484, 106 Stat. 2765-2766)
* * * * *
    29. In Sec. 21.7136, paragraphs (a), (b), (c), (d) and (e) are 
redesignated as paragraphs (b), (c), (d), (e) and (f), respectively; 
the introductory text of newly redesignated paragraph (f) is amended by 
removing ``Sec. 21.7045(b)(2)'' and adding, in its place, 
``Sec. 21.7045(b)(1)(ii) or (c)(1)(ii)''; and introductory text is 
added to the section, paragraph (a) is added, newly 

[[Page 6789]]
redesignated paragraphs (b) and (c) are revised to read as follows:


Sec. 21.7136  Rates of payment of basic educational assistance.

    The monthly rate of educational assistance payable to a veteran or 
servicemember depends in part upon the service requirements he or she 
met to establish eligibility for that educational assistance.
    (a) Service requirements for higher rates. The monthly rate of 
basic educational assistance payable to a veteran or servicemember 
shall be the rate stated in paragraph (b) of this section when--
    (1) The veteran has established eligibility for educational 
assistance under Sec. 21.7045; or
    (2) The veteran has established eligibility under Sec. 21.7042, and 
one of the following sets of circumstances exist.
    (i) The veteran's initial obligated period of active duty is at 
least three years; or
    (ii) The veteran's initial obligated period of active duty is at 
least two years and less than three years and either the veteran has 
served or is committed to serve in the Selected Reserve for a period of 
at least four years, or the veteran was committed to serve in the 
Selected Reserve for a period of at least four years but failed to 
complete four years service for one of the reasons stated in 
Sec. 21.7042(b)(7)(i) or (iii); or
    (iii) The veteran's initial obligated period of active duty is at 
least two years and less than three years and--
    (A) The basic educational assistance is payable for training 
received after August 31, 1993;
    (B) The veteran's continuous active duty service beginning on the 
date of the commencement of his or her initial obligated period of 
active duty is at least three years and upon completion of that 
continuous period of active duty the veteran either--
    (1) Continues on active duty; or
    (2) Is discharged from active duty with an honorable discharge; or
    (3) Is released after service on active duty characterized by the 
Secretary concerned as honorable service and is placed on the retired 
list, transferred to the Fleet Reserve or the Fleet Marine Corps 
Reserve, placed on the temporary disability retired list; or
    (4) Is released from active duty for further service in a reserve 
component of the Armed Forces after service on active duty 
characterized by the Secretary concerned as honorable service.

(Authority: 38 U.S.C. 3015(a))

    (b) Rates. (1) Except as provided in paragraphs (b)(2) and (b)(3) 
of this section, the monthly rate of basic educational assistance 
payable to a veteran whose service meets the requirements of paragraph 
(a) of this section is the rate stated in the following table.

------------------------------------------------------------------------
               Training                           Monthly rate          
------------------------------------------------------------------------
Full time............................  $400.00.                         
\3/4\ time...........................  300.00.                          
\1/2\ time...........................  200.00.                          
Less than \1/2\ but more than \1/4\    200.00                           
 time.                                 See Sec.  21.7136(d).            
\1/4\ time or less...................  100.00                           
                                       See Sec.  21.7136(d).            
------------------------------------------------------------------------

(Authority: 38 U.S.C. 3015(c), 3015(f))

    (2) If a veteran's service is described in paragraph (a) of this 
section, the monthly rate of basic educational assistance payable when 
he or she is pursuing an apprenticeship or other on-job training is the 
rate stated in the following table.

------------------------------------------------------------------------
                                                                Monthly 
                       Training period                            rate  
------------------------------------------------------------------------
First six months of pursuit of program.......................    $300.00
Second six months of pursuit of program......................     220.00
Remaining pursuit of program.................................     140.00
------------------------------------------------------------------------

(Authority: 38 U.S.C. 3015, 3032(c))

    (3) If a veteran's service is described in paragraph (a) of this 
section, the monthly rate of basic educational assistance payable when 
he or she is pursuing a cooperative course is $320.

(Authority: 38 U.S.C. 3015(f), 3032(d))

    (c) Rates for some veterans whose initial obligated period of 
active duty is less than three years. If a veteran has established 
eligibility under Sec. 21.7042, but the veteran's service is not 
described in paragraph (a)(2) of this section, the monthly rate of 
educational assistance payable to the veteran shall be determined by 
this paragraph.
    (1) Except as provided in paragraphs (c)(2) and (c)(3) of this 
section, the monthly rate of basic educational assistance payable to a 
veteran is the amount stated in the following table.

------------------------------------------------------------------------
               Training                           Monthly rate          
------------------------------------------------------------------------
Full time............................  $325.00.                         
3/4 time.............................  243.75.                          
1/2 time.............................  162.50.                          
Less than 1/2 but more than 1/4 time.  162.50                           
                                       See Sec.  21.7136(d).            
1/4 time or less.....................  81.25                            
                                       See Sec.  21.7136(d).            
------------------------------------------------------------------------

(Authority: 38 U.S.C. 3015(c))

    (2) The monthly rate of educational assistance payable to a veteran 
who is pursuing an apprenticeship or other on-job training is the rate 
stated in the following table.

------------------------------------------------------------------------
                                                                Monthly 
                       Training period                            rate  
------------------------------------------------------------------------
First six months of pursuit of program.......................    $243.75
Second six months of pursuit of program......................     178.75
Remaining pursuit of program.................................     113.75
------------------------------------------------------------------------

(Authority: 38 U.S.C. 3032(c))

    (3) The monthly rate of basic educational assistance payable to a 
veteran is $260 when the veteran is pursuing a cooperative course.

(Authority: 38 U.S.C. 3015)
* * * * *
    30. In Sec. 21.7137, the heading and paragraphs (a)(1), (a)(2), and 
(c) are revised, to read as follows:


Sec. 21.7137  Rates of payment of basic educational assistance for 
individuals with remaining entitlement under 38 U.S.C. ch. 34.

    (a) Minimum rates. (1) Except as provided in paragraph (a)(2) of 
this section, the monthly rate of basic educational assistance will be 
the rate stated in the following table.

----------------------------------------------------------------------------------------------------------------
                                                                  Monthly rate                                  
                               ---------------------------------------------------------------------------------
                                                                                                      Additional
           Training                                                            One          Two        for each 
                                              No dependents                 dependent    dependents   additional
                                                                                                      dependent 
----------------------------------------------------------------------------------------------------------------
Full time.....................  $588.00..................................      $624.00      $655.00       $16.00
\3/4\ time....................  441.00...................................       468.00       491.50        12.00
\1/2\ time....................  294.00...................................       312.00       327.00         8.50
Less than \1/2\ but more than   294.00 See Sec.  21.7137(b)..............  ...........  ...........             
 \1/4\ time.                                                                                                    

[[Page 6790]]
                                                                                                                
\1/4\ time or less............  147.00 See Sec.  21.7137(b)..............  ...........  ...........             
Cooperative...................  441.60...................................       462.00       481.60         9.20
----------------------------------------------------------------------------------------------------------------



(Authority: 38 U.S.C. 3015(c), 3015(f))

    (2) For veterans pursuing an apprenticeship or other on-job 
training, the monthly rate of basic educational assistance will be the 
rate stated in the following table.

----------------------------------------------------------------------------------------------------------------
                                                                                 Monthly rate                   
                                                             ---------------------------------------------------
                                                                                                      Additional
                       Training period                             No          One          Two        for each 
                                                               dependents   dependent    dependents   additional
                                                                                                      dependent 
----------------------------------------------------------------------------------------------------------------
1st 6 mos. of pursuit of program............................      $402.75      $415.13      $426.00        $5.25
2nd 6 mos. of pursuit of program............................       276.38       285.73       293.43         3.85
3rd 6 mos. of pursuit of program............................       163.80       169.93       174.65         2.45
Remaining pursuit of program................................       151.90       157.68       162.93         2.45
----------------------------------------------------------------------------------------------------------------

(Authority: 38 U.S.C. 3015(d), 3015(f))
* * * * *
    (c) Rates for servicemembers. The monthly rate of educational 
assistance for a servicemember may not exceed the lesser of the 
following rates (except as provided in paragraph (d) of this section):
    (1) The monthly pro-rated cost of the course.
    (2) The following monthly rates--
    (i) $588.00 for full-time training,
    (ii) $441.00 for three-quarter-time training,
    (iii) $294.00 for one-half time training and training that is less 
than one-half, but more than one-quarter-time training, and
    (iv) $147.00 for one-quarter-time training.

(Authority: 38 U.S.C. 3015(d), 3015(f))

    31. In Sec. 21.7145, paragraph (e) is revised, to read as follows:


Sec. 21.7145  Work-study allowance.

* * * * *
    (e) Payment in advance. VA will pay in advance an amount equal to 
the lesser of the following:
    (1) 40 percent of the total amount payable under the contract, or
    (2) An amount equal to 50 times the applicable minimum hourly wage 
in effect on the date the contract is signed.

(Authority: 38 U.S.C. 3485)

    32. In Sec. 21.7152, paragraph (b)(3)(ii) is removed; paragraph 
(b)(3)(iii) is redesignated as paragraph (b)(3)(ii); and paragraph 
(b)(3)(i) is revised, to read as follows:


Sec. 21.7152  Certification of enrollment.

* * * * *
    (b) Length of the enrollment period covered by the enrollment 
certification.
* * * * *
    (3) * * *
    (i) The enrollment date, and
* * * * *
    33. In Sec. 21.7170, paragraphs (b) and (g) are removed; paragraphs 
(c), (d), (e) and (f) are redesignated as paragraphs (b), (c), (d) and 
(e), respectively; and the introductory text and paragraph (a) are 
revised, to read as follows:


Sec. 21.7170  Course measurement.

    In administering benefits payable under 38 U.S.C. chapter 30, VA 
shall apply the following sections.
    (a) Sec. 21.4270 (except paragraphs (a)(2) and (a)(3) and those 
portions of paragraph (c) and footnotes dealing with farm cooperative 
training)--Measurement of courses,

(Authority: 38 U.S.C. 3034, 3688)
* * * * *
    34. In Sec. 21.7172, paragraphs (a)(1), (a)(2), and (d) are 
revised, to read as follows:


Sec. 21.7172  Measurement of concurrent enrollments.

    (a) Conversion of units of measurement required. * * *
    (1) If VA measures the courses at the primary institution on a 
credit-hour basis (including a course which does not lead to a standard 
college degree, which is being measured on a credit-hour basis), and VA 
measures the courses at the second school on a clock-hour basis, the 
clock hours will be converted to credit hours.
    (2) If VA measures the courses pursued at the primary institution 
on a clock-hour basis, and VA measures the courses pursued at the 
second school on a credit-hour basis, VA will convert the credit hours 
to clock hours to determine the veteran's training time.

(Authority: 38 U.S.C. 3034, 3688)
* * * * *
    (d) Both courses measured on a credit hour basis or both courses 
measured on a clock hour basis. If VA measures the courses pursued at 
both institutions on a credit hour basis or on a clock hour basis, VA 
will measure the veteran's enrollment by adding together the units of 
measurement for the courses at the second school and the units of 
measurement for the courses at the primary institution. The standard 
for full time will be the full-time standard for the courses at the 
primary institution.

(Authority: 38 U.S.C. 3034, 3688)
    35. In Sec. 21.7220, paragraph (b) introductory text is revised, 
paragraphs (b)(9) and (b)(10) are revised, paragraph (b)(11) is added, 
and the authority citation for paragraph (b) is revised, to read as 
follows:


Sec. 21.7220  Course approval.

* * * * *
    (b) Course approval criteria. In administering benefits payable 
under 38 U.S.C. chapter 30, VA and, where appropriate, the State 
approving agencies, shall apply the following sections.
* * * * *
    (9) Section 21.4265--Practical training approved as institutional 
training or on-job training,
    (10) Section 21.4266--Courses offered at subsidiary branches or 
extensions, 

[[Page 6791]]

    (11) Section 21.4267--Approval of independent study.

(Authority: 38 U.S.C. 3034, 3476, 3672, 3675, 3676, 3678, 3679, 
3680A, 3689)
* * * * *
    36. In Sec. 21.7222, paragraph (e) and its authority citation are 
revised, to read as follows:


Sec. 21.7222  Courses and enrollments which may not be approved.

* * * * *
    (e) Except as provided in Sec. 21.7120(d), an independent study 
course which--
    (1) Does not lead to a standard college degree, or
    (2) Is a nonaccredited course.

(Authority: 38 U.S.C. 3676, 3680A)

    37. In Sec. 21.7280, paragraph (b)(1) is revised, to read as 
follows:


Sec. 21.7280  Death benefit.

* * * * *
    (b) Necessary criteria for death benefit. * * *
    (1) The individual either--
    (i) Dies while on active duty, or
    (ii) Dies after October 28, 1992, and his or her date of death is 
within one year after the date of his or her last discharge or release 
from active duty; and
* * * * *
[FR Doc. 96-3780 Filed 2-21-96; 8:45 am]
BILLING CODE 8320-01-P