Mulder v.Gibson, 27 Vet.App. 10 (July 8, 2014)
38 C.F.R. § 3.665(a), REDUCTION OF BENEFITS, INCARCERATED VETERAN
Held: The proper effective date for the reduction of benefits for veterans incarcerated for the conviction of a felony is the date of conviction, not the date of sentencing.
Veterans who are incarcerated for more than 60 days for the conviction of a felony will have their VA benefits reduced on the 61st day of incarceration. The veteran in this case pled “no contest” to a felony charge in May 2006 and was sentenced in July 2006. VA notified him of the proposed rating reduction in July 2007. The veteran submitted a statement to VA indicating that his “sentence was VACATED.” However, according to the veteran’s social worker, he was still incarcerated in September 2007 and there was no ruling about overturning the guilty plea. VA issued a decision implementing the proposed rating reduction, and the veteran filed a Notice of Disagreement. The Board determined that the reduction was proper, noting that while the veteran’s sentence “had been vacated and modified,” the conviction had “not been overturned or vacated” and the veteran remained incarcerated.
On appeal to the Court, the veteran relied on a state statute to argue that “he was not incarcerated for the conviction of a felony until his judgment of conviction and pronouncement of sentence was entered.” 27 Vet.App. at 13. The Court disagreed, relying on the plain language of 38 U.S.C. § 5313(a)(1) to determine that “the 60-day calculation begins on the 1st day of incarceration for conviction of a felony.” Id. at 15. To the extent that the language was deemed “ambiguous,” the Court found that VA’s regulation “mirrors exactly the language” of the statute, but that the Secretary’s interpretation of the regulation was entitled to “respect from this Court insofar as it has the ‘power to persuade.’” Id. at 17-18. The Court added that neither the statute nor the regulation mentions state law and that the Secretary’s interpretation is consistent with Congress’s stated objective of avoiding “duplicative Government expenditures that would result in a windfall for those convicted of felonies.” Id. at 18.