81 FR 71658 - Veterans' Mortgage Life Insurance-Coverage Amendment
DEPARTMENT OF VETERANS AFFAIRS Federal Register Volume 81, Issue 201 (October 18, 2016)
Federal Register Volume 81, Issue 201 (October 18, 2016)
| Page Range | 71658-71661 | |
| FR Document | 2016-25025 |
[Federal Register Volume 81, Number 201 (Tuesday, October 18, 2016)] [Proposed Rules] [Pages 71658-71661] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2016-25025] ======================================================================= ----------------------------------------------------------------------- DEPARTMENT OF VETERANS AFFAIRS 38 CFR Part 8a RIN 2900-AP49 Veterans' Mortgage Life Insurance--Coverage Amendment AGENCY: Department of Veterans Affairs. ACTION: Proposed rule. ----------------------------------------------------------------------- SUMMARY: The Department of Veterans Affairs (VA) proposes to amend its regulations governing the Veterans' Mortgage Life Insurance (VMLI) program in order to provide VMLI-eligible individuals the option to lower their premiums by purchasing less than the minimum coverage amount required under current VA regulations. The proposed rule would also amend current VA regulations to reflect that the statutory maximum amount of coverage available under the VMLI program was previously increased to $200,000, to define the term ``eligible individual,'' and to clarify that eligibility for VMLI coverage has been extended to include servicemembers as well as veterans. These additional amendments are necessary to conform the existing regulations to current statutory provisions. DATES: Comments must be received on or before December 19, 2016. ADDRESSES: Written comments may be submitted through http://www.Regulations.gov; by mail or hand delivery to Director, Regulation Policy and Management (00REG), 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-AP49--Veterans' Mortgage Life Insurance--Coverage Amendment.'' Copies of comments received will be available for public inspection in the Office of Regulation Policy and Management, Room 1068, 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 http://www.Regulations.gov. FOR FURTHER INFORMATION CONTACT: Jeanne King, Attorney-Advisor, Insurance Service, Department of Veterans Affairs (310/290B), 5000 Wissahickon Avenue, P.O. Box 8079, Philadelphia, PA 19101, (215) 842- 2000, ext. 4839. (This is not a toll-free number.) SUPPLEMENTARY INFORMATION: The Veterans' Mortgage Life Insurance (VMLI) program was established in 1971 to provide mortgage protection insurance to service-disabled veterans who receive Specially Adapted Housing Grants from VA. Under 38 U.S.C. 2106(g), the amount of VMLI coverage for a veteran is the amount necessary to pay the veteran's mortgage indebtedness in full, except as limited by section 2106(b) or ``regulations prescribed by the Secretary under this section.'' Section 2106(b) currently limits the amount of VMLI available to $200,000. Therefore, currently, a veteran who has a mortgage indebtedness that is greater than $200,000 and seeks VMLI must be covered in the amount of $200,000 and pay the corresponding premiums for such coverage. VA has concluded that requiring this level of coverage in such circumstance may cause some individuals to forego VMLI protection because they cannot afford the premiums. To address this specific problem and to allow veterans to pay lower premiums regardless of their mortgage indebtedness, VA proposes to exercise its explicit statutory authority set forth in section 2106(g) and amend its regulations to permit program participants to lower their premiums by carrying VMLI in an amount less than both the $200,000 statutory maximum and the amount necessary to pay the covered mortgage indebtedness in full. As noted, paying the premiums on the level of coverage required under current regulations can present a financial hardship to individuals insured under the program. We realize that allowing eligible individuals to carry an amount of VMLI lower than the amount outstanding on the mortgage loan may result in circumstances where an insured dies with a balance on the loan that exceeds the amount of VMLI in effect, which currently occurs when an individual's mortgage balance exceeds the statutory maximum level of coverage. In such a situation, the individual's survivors may have to assume payment on the mortgage. However, VA believes that it is preferable for individuals to participate in the VMLI program to the extent they can financially, rather than foregoing coverage entirely because they cannot afford it. If an eligible individual opts out of the program, and then dies with an outstanding balance on the loan, his or her survivors could ultimately be forced to assume an even greater indebtedness than if the individual had carried partial VMLI coverage. Individuals often seek to lower their VMLI premiums by requesting an amount of coverage less than both the statutory limit and the amount necessary to pay the mortgage indebtedness in full. For example, from January 1, 2005, to December 31, 2010, when the statutory coverage limit was $90,000, VA received 231 requests to terminate existing VMLI coverage. VA reviewed approximately 100 requests to determine if financial hardship was a factor in individuals' decisions to terminate coverage. Thirty percent of veterans who terminated their coverage during that period stated that the premium charged for their coverage was the main factor motivating their requests. Effective October 1, 2011, the Veterans' Benefits Act of 2010 raised the statutory maximum coverage for VMLI from $90,000 to $150,000, and to $200,000 after January 1, 2012. See Public Law 111- 275, Title IV, Sec. 407, 124 Stat. 2864, 2880. Depending on a veteran's age and mortgage balance, this statutory change could cause an individual's monthly premiums to increase by almost $400.00--from less than $460.00 to more than $850.00 per month. As such, VA has concluded that, because premiums for the new statutory maximum amount of $200,000 are considerably higher than premiums for the former maximum amount, an increasing number of individuals may terminate their VMLI coverage or decline coverage entirely unless VA offers options to buy a lesser amount of VMLI. To promptly address this problem, VA adopted an interim policy allowing [[Page 71659]] insureds to select less than both the statutory maximum and their outstanding mortgage balance. VA implemented this interim policy to avoid unintended harm to program participants. VA now seeks to amend its regulations to make this policy permanent. In establishing the VMLI program, Congress intended to provide seriously disabled veterans with a reasonable level of mortgage protection insurance. If individuals decline coverage because they cannot afford the premiums, the purpose of the program is undermined. Therefore, VA proposes to amend its Part 8a regulations to reflect the new statutory maximum and provide program participants the option to select a more affordable level of coverage that is lower than both the statutory maximum and their outstanding mortgage balance. VA believes this change would benefit all VMLI-eligible individuals because it would provide needed flexibility in the program and empower veterans to decide what level of coverage they can afford. As explained above, VA has concluded that it is preferable for individuals to make their own financial decisions as to what level of VMLI they can afford, rather than foregoing coverage because they cannot afford a higher amount mandated by statute. Absent VA's proposed amendment, current regulations would likely prompt some veterans to decline VMLI coverage because they cannot afford the required premiums, ultimately forcing more survivors into greater mortgage debt than if partial VMLI coverage were available. We interpret 38 U.S.C. 2106 as authorizing VA to prescribe regulations permitting VMLI coverage in amounts less than the statutory maximum and the outstanding mortgage indebtedness. Section 2106(g) requires that VMLI participants carry the amount of insurance necessary to pay their mortgage indebtedness in full, but explicitly authorizes the Secretary to prescribe an exception to this requirement. Moreover, section 2106(b) imposes a cap of $200,000 in coverage but does not mandate that VMLI participants carry the maximum amount of coverage available. Therefore, VA's proposed amendments to its regulations are implicitly authorized by 38 U.S.C. 2106. The proposed amendment would exercise this authority by amending 38 CFR 8a.1(c) and 38 CFR 8a.2(a) to provide insureds with the option to select a more affordable level of coverage. We propose to revise the term ``initial amount of insurance'' in Sec. 8a.1(c) to mean ``the amount of insurance selected by the insured, which may be less than the statutory maximum of $200,000 and less than the amount necessary to pay the mortgage indebtedness in full.'' This change would make clear that VMLI-eligible individuals are authorized to carry such VMLI coverage as they select, up to the lesser of the $200,000 statutory maximum or the amount necessary to pay their mortgage indebtedness in full. We would also amend Sec. 8a.2(a) and (b)(1) and Sec. 8a.4(b) and (c) to reflect that the current statutory maximum of VMLI coverage, as previously increased, is $200,000. The proposed amendments to 38 CFR 8a.4(b)-(c) removing ``available to'' and adding in its place ``selected by'' are designed to ensure conformity with this change by making clear that the amount of insurance on the life of the eligible individual may be a reduced amount selected by the eligible individual, up to the lesser of the $200,000 statutory maximum or the amount necessary to pay their mortgage indebtedness in full. For the reasons discussed above, these amendments would benefit veterans and their beneficiaries by adding needed flexibility to the program and empowering individuals to make financial decisions based on the level of VMLI coverage they can afford. While such decisions require veterans and their families to consider the financial risk of choosing a lower amount of VMLI that may not cover their mortgage indebtedness in full, we feel that such personal financial decisions are best left to veterans and their families. Accordingly, VA's proposed amendments seek to provide veterans with the flexibility to choose the level of VMLI coverage that meets their financial needs. In doing so, we seek to minimize the number of eligible individuals who opt out of the program for financial reasons, and reduce instances where a veteran's survivors must assume greater indebtedness than if the veteran had carried at least partial VMLI coverage. In short, VA has concluded that veterans should enjoy the option to obtain VMLI coverage tailored to their specific needs. We also propose a number of technical changes to 38 CFR part 8a to ensure consistency with current statutory authority. In the Housing and Economic Recovery Act of 2008, Congress extended eligibility for VMLI coverage to servicemembers in addition to veterans. See Public Law 110- 289, section 2602, 122 Stat. 2654, 2858-2860. We propose to add a new definition of ``eligible individual'' at Sec. 8a.1(f) to reflect this extension of eligibility for VMLI coverage and replace the term veteran with individual wherever appropriate in Sec. Sec. 8a.1 through 8a.4. These substitutions would not cause any substantive change other than that brought about by Public Law 110-289. Additionally, we propose one technical change to 38 CFR 8a.2(b)(8), which currently prescribes, ``[a]ll claims, arising out of the deaths of insured veterans occurring prior to (date of final publication), shall be subject to the provisions of paragraph (a) of this section then in effect which limited the amount of VMLI coverage to a lifetime maximum per eligible veteran.'' The parenthetical ``(date of final publication)'' appears to have been erroneously maintained in the Code of Federal Regulations, rather than being replaced by the appropriate date. We are correcting this error by striking ``(date of final publication)'' and inserting ``December 24, 1987,'' which is the effective date of the final rule that codified that regulation. See 52 FR 26356-01 (July 14, 1987) (proposed); 52 FR 48681-02 (Dec. 24, 1987) (final). No substantive change is intended. We would also revise the authority citations at the end of Sec. 8a.2 and Sec. 8a.4 and add authority citations at the end of Sec. 8a.1 and Sec. 8a.3 to cite to 38 U.S.C. 501, 2101, 2101A, and 2106. 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 an expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $100 million or more (adjusted annually for inflation) in any one year. This proposed rule would have no such effect on State, local, and tribal governments or on the private sector. Paperwork Reduction Act This proposed rule contains no provisions constituting a collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3521). Executive Orders 12866 and 13563 Executive Orders 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, when regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, and other advantages; distributive impacts; and equity). Executive Order 13563 (Improving [[Page 71660]] Regulation and Regulatory Review) emphasizes the importance of quantifying both costs and benefits, reducing costs, harmonizing rules, and promoting flexibility. Executive Order 12886 (Regulatory Planning and Review) defines a ``significant regulatory action,'' which requires review by the Office of Management and Budget (OMB), unless OMB waives such review, 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. VA's impact analysis can be found as a supporting document at http://www.regulations.gov, usually within 48 hours after the rulemaking document is published. Additionally, a copy of the rulemaking and its impact analysis are available on VA's Web site at http://www.va.gov/orpm/, by following the link for ``VA Regulations Published From FY 2004 Through Fiscal Year to Date.'' Regulatory Flexibility Act The Secretary of Veterans Affairs hereby certifies that this proposed rule would not have a significant economic impact on a substantial number of small entities as they are defined in the Regulatory Flexibility Act, 5 U.S.C. 601-612. This proposed rule would directly affect only individuals and would not directly affect any small entities. Therefore, pursuant to 5 U.S.C. 605(b), this rulemaking is exempt from the initial and final regulatory flexibility analysis requirements of sections 603 and 604. Catalog of Federal Domestic Assistance The Catalog of Federal Domestic Assistance number and title for the program affected by this document is 64.103, Life Insurance for Veterans. 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. Gina S. Farrisee, Deputy Chief of Staff, Department of Veterans Affairs, approved this document on October 7, 2016, for publication. Dated: October 7, 2016. Jeffrey Martin, Office Program Manager, Office of Regulation Policy & Management, Office of the Secretary, Department of Veterans Affairs. List of Subjects in 38 CFR Part 8a Life insurance, Mortgage insurance, Veterans. For the reasons stated in the preamble, VA proposes to amend 38 CFR part 8a as set forth below: PART 8a--VETERANS MORTGAGE LIFE INSURANCE 0 1. The authority citation for part 8a continues to read as follows: Authority: 38 U.S.C. 501, and 2101 through 2106, unless otherwise noted. 0 2. Amend Sec. 8a.1 as follows: 0 a. In paragraph (a), remove ``veteran'' each place it appears and add in its place ``individual''; 0 b. In paragraph (b), remove ``veterans'' the second time it appears and add in its place ``individuals''; 0 c. Revise paragraph (c); 0 d. In paragraph (d), remove ``veteran'' and add in its place ``individual''; 0 e. In paragraph (e) introductory text, remove ``veteran'' and add in its place ``individual''; 0 f. Add paragraph (f); and 0 g. Add an authority citation to the end of the section. The revision and additions read as follows: Sec. 8a.1 Definitions. * * * * * (c) The term initial amount of insurance means the amount of insurance selected by the insured, which may be less than the statutory maximum of $200,000 and less than the amount necessary to pay the mortgage indebtedness in full. * * * * * (f) The term eligible individual means a person who has been determined by the Secretary to be eligible for benefits pursuant to 38 U.S.C. chapter 21. (Authority: 38 U.S.C. 501, 2101, 2101A, 2106) 0 3. Amend Sec. 8a.2 as follows: 0 a. In paragraph (a), remove ``veteran'' each place it appears and add in its place ``individual'', remove ``$90,000'' and add in its place ``$200,000'', and add ``an initial amount of insurance'' between ``authorized'' and ``up''; 0 b. In paragraph (b)(1), remove ``$90,000'' and add in its place ``$200,000''; 0 c. In paragraph (b)(2), remove ``veteran'' and add in its place ``individual''; 0 d. In paragraph (b)(3), remove ``veteran'' each place it appears and add in its place ``individual''; 0 e. In paragraph (b)(4), remove ``veteran'' each place it appears and add in its place ``individual''; 0 f. In paragraph (b)(5), remove ``veteran'' and add in its place ``individual''; 0 g. In paragraph (b)(6), remove ``veteran'' each place it appears and add in its place ``individual''; 0 h. In paragraph (b)(7), remove ``veterans'' each place it appears and add in its place ``individuals''; 0 i. In paragraph (b)(8), remove ``veteran'' and add in its place ``individual'', remove ``veterans'' and add in its place ``individuals'', and remove ``(date of final publication)'' and add in its place ``December 24, 1987''; 0 j. In paragraph (c), remove ``veteran'' and add in its place ``individual''; and 0 k. Revise the authority citation at the end of section. The revision reads as follows: Sec. 8a.2 Maximum amount of insurance. * * * * * (Authority: 38 U.S.C. 501, 2101, 2101A, 2106) 0 4. Amend Sec. 8a.3 as follows: 0 a. In paragraph (a), remove ``veteran'' each place it appears and add in its place ``individual''; 0 b. In paragraph (b), remove ``veteran'' each place it appears and add in its place ``individual''; 0 c. In paragraph (c), remove ``a veteran'' and add in its place ``an individual'', and remove ``the veteran'' each place it appears and add in its place ``the individual''; 0 d. In paragraph (d), remove ``veteran'' each place it appears and add in its place ``individual''; 0 e. In paragraph (e), remove ``veteran'' each place it appears and add in its place ``individual''; and 0 f. Add an authority citation to the end of the section. The addition reads as follows: Sec. 8a.3 Effective date. * * * * * [[Page 71661]] (Authority: 38 U.S.C. 501, 2101, 2101A, 2106) 0 5. Amend Sec. 8a.4 as follows: 0 a. In paragraph (b), remove ``$90,000'' each place it appears and add in its place ``$200,000'', remove ``available to'' each place it appears and add in its place ``selected by'', and remove ``veteran'' each place it appears and add in its place ``individual''; 0 b. In paragraph (c), remove ''$90,000'' and add in its place ``$200,000'', remove ``available to'' and add in its place ``selected by'', remove ``eligible veteran'' each place it appears and add in its place ``eligible individual'', and remove ``a veteran'' and add in its place ``an individual''; and 0 c. Revise the authority citation at the end of section. The revision reads as follows: Sec. 8a.4 Coverage. * * * * * (Authority: 38 U.S.C. 501, 2101, 2101A, 2106) [FR Doc. 2016-25025 Filed 10-17-16; 8:45 am] BILLING CODE 8320-01-P
![71658 Federal Register / Vol. 81, No. 201 / Tuesday, October 18, 2016 / Proposed Rules
U.S. mail: Copyright Royalty Board, of Veterans Affairs, 810 Vermont Ave. hardship to individuals insured under
P.O. Box 70977, Washington, DC 20024– NW., Room 1068, Washington, DC the program. We realize that allowing
0977; or 20420; or by fax to (202) 273–9026. eligible individuals to carry an amount
Overnight service (only USPS Express Comments should indicate that they are of VMLI lower than the amount
Mail is acceptable): Copyright Royalty submitted in response to ‘‘RIN 2900– outstanding on the mortgage loan may
Board, P.O. Box 70977, Washington, DC AP49—Veterans’ Mortgage Life result in circumstances where an
20024–0977; or Insurance—Coverage Amendment.’’ insured dies with a balance on the loan
Commercial courier: Address package Copies of comments received will be that exceeds the amount of VMLI in
to: Copyright Royalty Board, Library of available for public inspection in the effect, which currently occurs when an
Congress, James Madison Memorial Office of Regulation Policy and individual’s mortgage balance exceeds
Building, LM–403, 101 Independence Management, Room 1068, between the the statutory maximum level of
Avenue SE., Washington, DC 20559– hours of 8 a.m. and 4:30 p.m., Monday coverage. In such a situation, the
6000. Deliver to: Congressional Courier through Friday (except holidays). Please individual’s survivors may have to
Acceptance Site, 2nd Street NE. and D call (202) 461–4902 for an appointment. assume payment on the mortgage.
Street NE., Washington, DC; or (This is not a toll-free number.) In However, VA believes that it is
Hand delivery: Library of Congress, addition, during the comment period, preferable for individuals to participate
James Madison Memorial Building, LM– comments may be viewed online in the VMLI program to the extent they
401, 101 Independence Avenue SE., through the Federal Docket Management can financially, rather than foregoing
Washington, DC 20559–6000. System (FDMS) at http:// coverage entirely because they cannot
www.Regulations.gov. afford it. If an eligible individual opts
Dated: October 12, 2016.
FOR FURTHER INFORMATION CONTACT: out of the program, and then dies with
Suzanne M. Barnett, an outstanding balance on the loan, his
Chief Copyright Royalty Judge. Jeanne King, Attorney-Advisor,
Insurance Service, Department of or her survivors could ultimately be
[FR Doc. 2016–25075 Filed 10–17–16; 8:45 am] forced to assume an even greater
Veterans Affairs (310/290B), 5000
BILLING CODE 1410–72–P
Wissahickon Avenue, P.O. Box 8079, indebtedness than if the individual had
Philadelphia, PA 19101, (215) 842– carried partial VMLI coverage.
Individuals often seek to lower their
2000, ext. 4839. (This is not a toll-free
DEPARTMENT OF VETERANS VMLI premiums by requesting an
number.)
AFFAIRS amount of coverage less than both the
SUPPLEMENTARY INFORMATION: The statutory limit and the amount
38 CFR Part 8a Veterans’ Mortgage Life Insurance necessary to pay the mortgage
(VMLI) program was established in 1971 indebtedness in full. For example, from
RIN 2900–AP49 to provide mortgage protection January 1, 2005, to December 31, 2010,
insurance to service-disabled veterans when the statutory coverage limit was
Veterans’ Mortgage Life Insurance— who receive Specially Adapted Housing $90,000, VA received 231 requests to
Coverage Amendment Grants from VA. Under 38 U.S.C. terminate existing VMLI coverage. VA
AGENCY: Department of Veterans Affairs. 2106(g), the amount of VMLI coverage reviewed approximately 100 requests to
for a veteran is the amount necessary to determine if financial hardship was a
ACTION: Proposed rule. pay the veteran’s mortgage indebtedness factor in individuals’ decisions to
SUMMARY: The Department of Veterans in full, except as limited by section terminate coverage. Thirty percent of
Affairs (VA) proposes to amend its 2106(b) or ‘‘regulations prescribed by veterans who terminated their coverage
regulations governing the Veterans’ the Secretary under this section.’’ during that period stated that the
Mortgage Life Insurance (VMLI) Section 2106(b) currently limits the premium charged for their coverage was
program in order to provide VMLI- amount of VMLI available to $200,000. the main factor motivating their
eligible individuals the option to lower Therefore, currently, a veteran who has requests.
their premiums by purchasing less than a mortgage indebtedness that is greater Effective October 1, 2011, the
the minimum coverage amount required than $200,000 and seeks VMLI must be Veterans’ Benefits Act of 2010 raised the
under current VA regulations. The covered in the amount of $200,000 and statutory maximum coverage for VMLI
proposed rule would also amend pay the corresponding premiums for from $90,000 to $150,000, and to
current VA regulations to reflect that the such coverage. VA has concluded that $200,000 after January 1, 2012. See
statutory maximum amount of coverage requiring this level of coverage in such Public Law 111–275, Title IV, § 407, 124
available under the VMLI program was circumstance may cause some Stat. 2864, 2880. Depending on a
previously increased to $200,000, to individuals to forego VMLI protection veteran’s age and mortgage balance, this
define the term ‘‘eligible individual,’’ because they cannot afford the statutory change could cause an
and to clarify that eligibility for VMLI premiums. To address this specific individual’s monthly premiums to
coverage has been extended to include problem and to allow veterans to pay increase by almost $400.00—from less
servicemembers as well as veterans. lower premiums regardless of their than $460.00 to more than $850.00 per
These additional amendments are mortgage indebtedness, VA proposes to month. As such, VA has concluded that,
necessary to conform the existing exercise its explicit statutory authority because premiums for the new statutory
regulations to current statutory set forth in section 2106(g) and amend maximum amount of $200,000 are
provisions. its regulations to permit program considerably higher than premiums for
participants to lower their premiums by the former maximum amount, an
Lhorne on DSK30JT082PROD with PROPOSALS
DATES: Comments must be received on carrying VMLI in an amount less than increasing number of individuals may
or before December 19, 2016. both the $200,000 statutory maximum terminate their VMLI coverage or
ADDRESSES: Written comments may be and the amount necessary to pay the decline coverage entirely unless VA
submitted through http:// covered mortgage indebtedness in full. offers options to buy a lesser amount of
www.Regulations.gov; by mail or hand As noted, paying the premiums on the VMLI.
delivery to Director, Regulation Policy level of coverage required under current To promptly address this problem,
and Management (00REG), Department regulations can present a financial VA adopted an interim policy allowing
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![Federal Register / Vol. 81, No. 201 / Tuesday, October 18, 2016 / Proposed Rules 71659
insureds to select less than both the § 8a.1(c) to mean ‘‘the amount of VMLI coverage and replace the term
statutory maximum and their insurance selected by the insured, veteran with individual wherever
outstanding mortgage balance. VA which may be less than the statutory appropriate in §§ 8a.1 through 8a.4.
implemented this interim policy to maximum of $200,000 and less than the These substitutions would not cause
avoid unintended harm to program amount necessary to pay the mortgage any substantive change other than that
participants. VA now seeks to amend its indebtedness in full.’’ This change brought about by Public Law 110–289.
regulations to make this policy would make clear that VMLI-eligible Additionally, we propose one
permanent. individuals are authorized to carry such technical change to 38 CFR 8a.2(b)(8),
In establishing the VMLI program, VMLI coverage as they select, up to the which currently prescribes, ‘‘[a]ll
Congress intended to provide seriously lesser of the $200,000 statutory claims, arising out of the deaths of
disabled veterans with a reasonable maximum or the amount necessary to insured veterans occurring prior to (date
level of mortgage protection insurance. pay their mortgage indebtedness in full. of final publication), shall be subject to
If individuals decline coverage because We would also amend § 8a.2(a) and the provisions of paragraph (a) of this
they cannot afford the premiums, the (b)(1) and § 8a.4(b) and (c) to reflect that section then in effect which limited the
purpose of the program is undermined. the current statutory maximum of VMLI amount of VMLI coverage to a lifetime
Therefore, VA proposes to amend its coverage, as previously increased, is maximum per eligible veteran.’’ The
Part 8a regulations to reflect the new $200,000. parenthetical ‘‘(date of final
statutory maximum and provide The proposed amendments to 38 CFR publication)’’ appears to have been
program participants the option to select 8a.4(b)–(c) removing ‘‘available to’’ and erroneously maintained in the Code of
a more affordable level of coverage that adding in its place ‘‘selected by’’ are Federal Regulations, rather than being
is lower than both the statutory designed to ensure conformity with this replaced by the appropriate date. We are
maximum and their outstanding change by making clear that the amount correcting this error by striking ‘‘(date of
mortgage balance. VA believes this of insurance on the life of the eligible final publication)’’ and inserting
change would benefit all VMLI-eligible individual may be a reduced amount ‘‘December 24, 1987,’’ which is the
individuals because it would provide selected by the eligible individual, up to effective date of the final rule that
needed flexibility in the program and the lesser of the $200,000 statutory codified that regulation. See 52 FR
empower veterans to decide what level maximum or the amount necessary to 26356–01 (July 14, 1987) (proposed); 52
of coverage they can afford. As pay their mortgage indebtedness in full. FR 48681–02 (Dec. 24, 1987) (final). No
explained above, VA has concluded that For the reasons discussed above, these substantive change is intended.
it is preferable for individuals to make amendments would benefit veterans and We would also revise the authority
their own financial decisions as to what their beneficiaries by adding needed citations at the end of § 8a.2 and § 8a.4
level of VMLI they can afford, rather flexibility to the program and and add authority citations at the end of
than foregoing coverage because they empowering individuals to make § 8a.1 and § 8a.3 to cite to 38 U.S.C. 501,
cannot afford a higher amount financial decisions based on the level of 2101, 2101A, and 2106.
mandated by statute. Absent VA’s VMLI coverage they can afford. While
proposed amendment, current such decisions require veterans and Unfunded Mandates
regulations would likely prompt some their families to consider the financial The Unfunded Mandates Reform Act
veterans to decline VMLI coverage risk of choosing a lower amount of of 1995 requires, at 2 U.S.C. 1532, that
because they cannot afford the required VMLI that may not cover their mortgage agencies prepare an assessment of
premiums, ultimately forcing more indebtedness in full, we feel that such anticipated costs and benefits before
survivors into greater mortgage debt personal financial decisions are best left issuing any rule that may result in an
than if partial VMLI coverage were to veterans and their families. expenditure by State, local, and tribal
available. Accordingly, VA’s proposed governments, in the aggregate, or by the
We interpret 38 U.S.C. 2106 as amendments seek to provide veterans private sector, of $100 million or more
authorizing VA to prescribe regulations with the flexibility to choose the level (adjusted annually for inflation) in any
permitting VMLI coverage in amounts of VMLI coverage that meets their one year. This proposed rule would
less than the statutory maximum and financial needs. In doing so, we seek to have no such effect on State, local, and
the outstanding mortgage indebtedness. minimize the number of eligible tribal governments or on the private
Section 2106(g) requires that VMLI individuals who opt out of the program sector.
participants carry the amount of for financial reasons, and reduce
insurance necessary to pay their instances where a veteran’s survivors Paperwork Reduction Act
mortgage indebtedness in full, but must assume greater indebtedness than This proposed rule contains no
explicitly authorizes the Secretary to if the veteran had carried at least partial provisions constituting a collection of
prescribe an exception to this VMLI coverage. In short, VA has information under the Paperwork
requirement. Moreover, section 2106(b) concluded that veterans should enjoy Reduction Act of 1995 (44 U.S.C. 3501–
imposes a cap of $200,000 in coverage the option to obtain VMLI coverage 3521).
but does not mandate that VMLI tailored to their specific needs.
participants carry the maximum amount We also propose a number of Executive Orders 12866 and 13563
of coverage available. Therefore, VA’s technical changes to 38 CFR part 8a to Executive Orders 12866 and 13563
proposed amendments to its regulations ensure consistency with current direct agencies to assess all costs and
are implicitly authorized by 38 U.S.C. statutory authority. In the Housing and benefits of available regulatory
2106. Economic Recovery Act of 2008, alternatives and, when regulation is
Lhorne on DSK30JT082PROD with PROPOSALS
The proposed amendment would Congress extended eligibility for VMLI necessary, to select regulatory
exercise this authority by amending 38 coverage to servicemembers in addition approaches that maximize net benefits
CFR 8a.1(c) and 38 CFR 8a.2(a) to to veterans. See Public Law 110–289, (including potential economic,
provide insureds with the option to section 2602, 122 Stat. 2654, 2858–2860. environmental, public health and safety
select a more affordable level of We propose to add a new definition of effects, and other advantages;
coverage. We propose to revise the term ‘‘eligible individual’’ at § 8a.1(f) to distributive impacts; and equity).
‘‘initial amount of insurance’’ in reflect this extension of eligibility for Executive Order 13563 (Improving
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![Federal Register / Vol. 81, No. 201 / Tuesday, October 18, 2016 / Proposed Rules 71661
(Authority: 38 U.S.C. 501, 2101, 2101A, referencing error. The EPA is seeking 0682. Clearly mark the part or all of the
2106) comment only on the five identified information that you claim to be CBI.
■ 5. Amend § 8a.4 as follows: petition issues and on the proposed For CBI information on a disk or CD–
■ a. In paragraph (b), remove ‘‘$90,000’’ compliance issue clarification and ROM that you mail to the EPA, mark the
each place it appears and add in its referencing error amendments. The EPA outside of the disk or CD–ROM as CBI
place ‘‘$200,000’’, remove ‘‘available to’’ will not respond to comments and then identify electronically within
each place it appears and add in its addressing any other issues or any other the disk or CD–ROM the specific
place ‘‘selected by’’, and remove provisions of the final rule. information you claim as CBI. In
‘‘veteran’’ each place it appears and add DATES: Comments must be received on addition to one complete version of the
in its place ‘‘individual’’; or before December 2, 2016. comment that includes information
■ b. In paragraph (c), remove ’’$90,000’’ ADDRESSES: Submit your comments, claimed as CBI, you must submit a copy
and add in its place ‘‘$200,000’’, remove identified by Docket ID No. EPA–HQ– of the comment that does not contain
‘‘available to’’ and add in its place OAR–2010–0682, at http:// the information claimed as CBI for
‘‘selected by’’, remove ‘‘eligible veteran’’ www.regulations.gov. Follow the online inclusion in the public docket.
each place it appears and add in its instructions for submitting comments. Information so marked will not be
place ‘‘eligible individual’’, and remove Once submitted, comments cannot be disclosed except in accordance with
‘‘a veteran’’ and add in its place ‘‘an edited or removed from Regulations.gov. procedures set forth in 40 CFR part 2.
individual’’; and The EPA may publish any comment The http://www.regulations.gov Web
■ c. Revise the authority citation at the received to its public docket. Do not site is an ‘‘anonymous access’’ system,
end of section. submit electronically any information which means the EPA will not know
The revision reads as follows: you consider to be Confidential your identity or contact information
Business Information (CBI) or other unless you provide it in the body of
§ 8a.4 Coverage.
information whose disclosure is your comment. If you send an email
* * * * * comment directly to the EPA without
restricted by statute. Multimedia
(Authority: 38 U.S.C. 501, 2101, 2101A, submissions (audio, video, etc.) must be going through http://
2106) accompanied by a written comment. www.regulations.gov, your email
[FR Doc. 2016–25025 Filed 10–17–16; 8:45 am] The written comment is considered the address will be automatically captured
BILLING CODE 8320–01–P official comment and should include and included as part of the comment
discussion of all points you wish to that is placed in the public docket and
make. The EPA is seeking comment made available on the Internet. If you
ENVIRONMENTAL PROTECTION only on the issues specifically identified submit an electronic comment, the EPA
AGENCY in this notice. The EPA will not respond recommends that you include your
to any comments addressing other name and other contact information in
40 CFR Part 63 aspects of the final rules or any other the body of your comment and with any
related rulemakings. The EPA will disk or CD–ROM you submit. If the EPA
[EPA–HQ–OAR–2010–0682; FRL–9954–25–
generally not consider comments or cannot read your comment due to
OAR]
comment contents located outside of the technical difficulties and cannot contact
RIN 2060–AT18 primary submission (i.e. on the web, you for clarification, the EPA may not
cloud, or other file sharing system). For be able to consider your comment.
National Emission Standards for additional submission methods, the full Electronic files should not include
Hazardous Air Pollutant Emissions: EPA public comment policy, special characters or any form of
Petroleum Refinery Sector information about CBI or multimedia encryption and be free of any defects or
AGENCY: Environmental Protection submissions, and general guidance on viruses.
Agency (EPA). making effective comments, please visit Docket. All documents in the docket
ACTION: Proposed rule. http://www2.epa.gov/dockets/ are listed in the regulations.gov index.
commenting-epa-dockets. Although listed in the index, some
SUMMARY: On December 1, 2015, the Instructions. Direct your comments to information is not publicly available,
Environmental Protection Agency (EPA) Docket ID No. EPA–HQ–OAR–2010– e.g., CBI or other information whose
finalized amendments to the National 0682. The EPA’s policy is that all disclosure is restricted by statute.
Emission Standards for Hazardous Air comments received will be included in Certain other material, such as
Pollutants (NESHAP) Refinery the public docket without change, and copyrighted material, is not placed on
Maximum Achievable Control will be made available online at http:// the Internet and will be publicly
Technology (MACT) 1 and Refinery www.regulations.gov, including any available only in hard copy. Publicly
MACT 2 regulations and the New personal information provided, unless available docket materials are available
Source Performance Standards (NSPS) the comment includes information either electronically in regulations.gov
for petroleum refineries. Subsequently, claimed to be CBI or other information or in hard copy at the EPA Docket
the EPA received three petitions for whose disclosure is restricted by statute. Center, EPA WJC West Building, Room
reconsideration of the final rules. The Do not submit information that you 3334, 1301 Constitution Ave. NW.,
EPA is announcing reconsideration and consider to be CBI or otherwise Washington, DC. The Public Reading
request for public comment on five protected through http:// Room is open from 8:30 a.m. to 4:30
issues raised in the petitions for www.regulations.gov or email. Send or p.m., Monday through Friday, excluding
Lhorne on DSK30JT082PROD with PROPOSALS
reconsideration where petitioners claim deliver information identified as CBI legal holidays. The telephone number
that the public was not afforded an only to the following address: OAQPS for the Public Reading Room is (202)
opportunity to comment. Additionally, Document Control Officer (C404–02), 566–1744, and the telephone number for
the EPA is proposing amendments to Office of Air Quality Planning and the EPA Docket Center is (202) 566–
the final rule to clarify a compliance Standards, U.S. EPA, Research Triangle 1742. Visit the EPA Docket Center
issue raised by stakeholders subject to Park, North Carolina 27711, Attention homepage at http://www.epa.gov/
the final rule and to correct a Docket ID No. EPA–HQ–OAR–2010– epahome/dockets.htm for additional
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Document Created: 2016-10-17 23:52:27
Document Modified: 2016-10-17 23:52:27
| Category | Regulatory Information | |
| Collection | Federal Register | |
| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
| Publisher | Office of the Federal Register, National Archives and Records Administration | |
| Section | Proposed Rules | |
| Action | Proposed rule. | |
| Dates | Comments must be received on or before December 19, 2016. | |
| Contact | Jeanne King, Attorney-Advisor, Insurance Service, Department of Veterans Affairs (310/290B), 5000 Wissahickon Avenue, P.O. Box 8079, Philadelphia, PA 19101, (215) 842- 2000, ext. 4839. (This is not a toll-free number.) | |
| FR Citation | 81 FR 71658 | |
| RIN Number | 2900-AP49 | |
| CFR Associated | Life Insurance; Mortgage Insurance and Veterans |
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