Availability of Expired Funds for Non-Monetary Judicial Awards
| Decision Date | 04 February 1991 |
| Docket Number | B-238615 |
| Citation | 70 Comp. Gen. 225 |
| Parties | Availability of Expired Funds for Non-monetary Judicial Awards. |
| Court | Comptroller General of the United States |
APPROPRIATIONS/FINANCIAL MANAGEMENT - Judgment Payments - Permanent/indefinite appropriation - Availability 1. The Judgment Fund, 31 U.S.C Sec. 1304 (1988), is not legally available to cover the costs of compliance by the Department of Veterans Affairs with either judgments or proposed compromise settlements that are "injunctive" in nature (i.e., they direct the government to perform or not perform some act). APPROPRIATIONS/FINANCIAL MANAGEMENT - Appropriation Availability - Time availability - Fiscal-year appropriation - Unobligated balances 2. The unobligated balance of an expired appropriation to implement extended educational assistance benefits mandated by 38 U.S.C. Sec. 1662(a)(3) (1988) and 29 U.S.C. Sec. 1721 note (1988) May be used by the Department of Veterans Affairs (VA) to satisfy a court order (OR a proposed settlement agreement) which requires VA to entertain new applications and reconsider the eligibility of veterans improperly denied benefits under those acts. The unobligated balance of VA's appropriations May be used to provide the mandated benefits pursuant to 31 U.S.C. Secs 1502(b) and 1553(a), section 1405 of the National Defense Authorization Act for Fiscal Year 1991 Pub.L. No. 101 510, 104 Stat. 1485, 1675-80 (Nov. 5, 1990).
The district court decision in Pacheco v. VA, No C-83-3098 (N.D. Ohio, Dec. 22, 1988), requires the Department of Veterans Affairs (VA) to reconsider the eligibility of certain Vietnam-era veterans for "GI Bill" educational benefits which VA withheld. VA is presently appealing that decision to the United States Court of Appeals for the Sixth Circuit. Nevertheless, VA's General Counsel has requested our opinion concerning what, if any, funds would be legally available to pay VA's obligations under the decision (if VA's appeal proves unsuccessful), or under a proposed compromise agreement (in the form of a Consent Order) which VA is currently considering in lieu of further appellate efforts. VA doubts that its own appropriations could be used for this purpose and suggests use of the so-called Judgment Fund, which is the permanent, indefinite appropriation created by 31 U.S.C. Sec 1304 (1988), as amended.
As explained below, it is our view that neither the district court's order (should it become final) nor the proposed settlement agreement would constitute "monetary" awards payable from the Judgment Fund. We also find that Congress has previously appropriated funds to VA to carry out the responsibilities which are the subject of the order and draft settlement agreement. Although the period of availability of those funds has expired, they remain available for use to cover obligations properly changeable to this account under 31 U.S.C. Secs. 1502(b), 1553(a), section 1405 of the National Defense Authorization Act for Fiscal Year 1991, Pub.L. No. 101-510, 104 Stat. 1485, 1675-80 (Nov. 5, 1990). Congress has also provided that part of VA's current appropriations May be used until expended to fund veterans' benefits restored under the court's order which exceed the amount of the expired funds. VA May need to seek a supplemental appropriation from the Congress, however, if it finds that these combined funds are insufficient to finance benefits for all veterans whose eligibility is restored as a result of the court order.
On July 29, 1983, a class action suit, Pacheco v. VA, No. C-83-3098, was brought against the VA on the ground that it had unduly restricted eligibility for the benefits contemplated by 38 U.S.C. Sec. 1662(a)(3) (), a part of the veterans' educational assistance program known as the "GI Bill." That law gave certain unemployed and underemployed Vietnam-era veterans an extension of time (until December 31, 1983-- later extended by Public Law 97-306, tit. II, 96 Stat. 1435 (1982), to December 31, 1984) in which to apply for educational assistance benefits in order to pursue "a program of apprenticeship or other on job training;... a course with an approved vocational objective;... or a program of secondary education." 38 U.S.C. Sec. 1662(a)(3)(A). The law required VA to grant those benefits to otherwise eligible veterans, except where VA determined that they were not needed by particular applicants. 38 U.S.C. Sec. 1662(a)(3)(C)(i). believed that pursuit of an associate or other college degree could never qualify under the statute as "a course with an approved vocational objective." Consequently, VA's regulations excluded all courses "leading to a standard college degree, " 38 C.F.R. Sec. 21.1044(d)(2)(ii) (1984), and VA denied benefits for such purpose to otherwise eligible veterans. The class action asked the court to require VA to change its regulations and to grant monetary benefits to those otherwise eligible veterans from whom VA had improperly withheld benefits.
While that court action was pending, Congress enacted the Emergency Veterans' Job Training Act (EVJTA), Pub.L. No. 98-77, 97 Stat. 443 (1983). Section 18 of that act provided:
"(a) An associate degree program which is predominantly vocational in content May be considered by VA, for the purposes of 38 U.S.C. Sec. 1662(a)(3) to be a course with an approved vocational objective...."
97 Stat. at 452, codified at 29 U.S.C. Sec. 1721 note (1988). The legislative history of this provision does not explicitly reference VA's regulation or the class action.[1]
In December 1988, the district court issued its decision. The court invalidated that portion of VA's regulations which excluded from the extended benefit program all courses leading to associate degrees. The court agreed with VA that the extended benefits program should be limited to courses which had occupational or vocational objectives. Nevertheless, the court held that many associate degree programs can and do have those objectives, and that VA was wrong to assume the contrary in its regulations. Indeed, the court cited section 18 of EVJTA as evidence that Congress agreed that VA was "distorting the plain language" of 38 U.S.C. Sec. 1662(a)(3). Pacheco, slip mem. op. at 10. The court instructed VA to reconsider the eligibility of all applicants from whom benefits were withheld solely because the courses involved were part of an associate degree program. The court also directed VA to extend this program until December 31, 1989, to afford an additional opportunity to any otherwise eligible veterans who May have been deterred from applying by VA's regulation.[2] Pacheco, slip mem. op. at 10-12.
At the same time, however, the court refused the plaintiffs' request for an order directing the VA to actually grant the withheld benefits. The court concluded that it lacked the authority to grant the improperly withheld benefits. This was because, while VA's implementation was improper, the statute was not and it requires VA to make a discretionary determination of each applicant's "need" for the benefits. Pacheco, slip mem. op. at 12. In other words, the court did not order VA to pay any money to the plaintiff. Instead, it required VA to reconsider whether to make any awards to them. Although it has appealed the court's decision to the federal Court of Appeals for the Sixth Circuit, VA has also reached a tentative settlement agreement with the plaintiff. Like the court's order, the proposed compromise agreement requires VA to reconsider whether to grant the withheld benefits to eligible applicants.
VA argues that both the district court judgment and the proposed compromise settlement (whichever becomes final) should be payable from the Judgment Fund-- the permanent indefinite appropriation established by 31 U.S.C. Sec. 1304. As noted in VA's submission, the Judgment Fund is legally available to pay those judgments against the United States which are "not otherwise provided for." 31 U.S.C. Sec 1304(a)(1). VA believes that the payment of this judgment is not otherwise provided for because, among other reasons, it can find no express statutory language permitting its payment from VA's appropriations. We think VA's arguments in this regard over-look a critical element of the law: Neither the court's order nor the proposed settlement agreement fall within the scope of the Judgment Fund appropriation.
With certain exceptions not relevant here, in order to qualify for payment from the Judgment Fund, there must be a monetary award against the United States under a judgment or settlement agreement (that is, the judgment or agreement must direct the government to pay money), as opposed to judgments and settlements which are injunctive in nature (i.e., which either direct the government to perform, or not to perform some particular action). Clearly, compliance with virtually any adverse judgment has a measurable cost to the government. However, as a general rule, unless the government is directly ordered to pay a sum of money, the costs of compliance with the judgment are not considered payable from the Judgment Fund. E.g., 69 Comp.Gen. 114, 116 (1990). Compromise settlements are treated similarly. 28 U.S.C. Sec. 2414 (1988).
As noted above, the order in this case explicitly disavows both the authority and the intention to award monetary judgments. Rather, it requires VA to perform a discretionary act-- to reconsider whether to award benefits to those otherwise eligible Vietnam-era veterans whose benefits were withheld based on VA's improper interpretation of the statute. The same is true of the proposed settlement agreement. Thus neither the order nor the proposed settlement...
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