Citation Nr: 20046537 Decision Date: 07/13/20 Archive Date: 07/13/20 DOCKET NO. 19-37 737 DATE: July 13, 2020 ORDER The reduction in Department of Veterans Affairs (VA) disability compensation due to concurrent receipt of military service drill pay for Fiscal Year (FY) 2016 was proper, and the appeal is denied. FINDINGS OF FACT 1. The Veteran was awarded service connection for multiple disabilities, each assigned individual ratings, which amounted to an 80 percent combined rating, effective April 2, 2015. 2. The Veteran elected to receive separation pay at the end of his period of service and that separation pay was recouped fully as of May 1, 2017. 4. The Veteran received military drill pay for a period of 74 days in FY 2016. 5. The Veteran’s VA disability compensation was properly reduced for concurrent receipt of military service drill pay for a period of 74 days in FY 2016. CONCLUSION OF LAW The reduction in VA disability compensation benefits to offset the concurrent receipt of active service drill pay for a period of 74 days in FY 2016 was proper. 38 U.S.C. §§ 5107, 5304(c) (2012); 38 C.F.R. §§ 3.654, 3.700 (2019). REASONS AND BASES FOR FINDINGS AND CONCLUSION The Veteran served on active duty from January 2007 to April 2015, and from January 2018 to October 2018, with additional service in the Army National Guard to include drill periods. The matter on appeal arises from an August 2017 assessment of debt associated with Military Drill Pay for FY 2016. The Veteran argues that this is not a valid debt. First, the Veteran argued that the number of drill days in 2016 originally assessed, 76, was incorrect and that the proper number was 74. Next, the Veteran argues that he was not receiving compensation benefits in 2016 due to his receipt of Separation Pay, such that he should not be required to repay any drill pay as there was no “double dipping” occurring. As relevant to this appeal, 38 U.S.C. § 5304 (c) prohibits the receipt of VA disability compensation benefits for any period for which the person receives active service pay. See 38 C.F.R. §§ 3.654, 3.700. This includes active duty pay, drill, and active duty for training payments, and inactive duty for training payments made to Reservists and members of the National Guard. Id. Reservists may waive their pension, compensation, or retirement pay for periods of field training, instruction, other duty, or drills. A waiver may include prospective periods and contain a right of recoupment for the days for which the reservist did not receive payment for duty by reason of failure to report for duty. 38 C.F.R. § 3.700 (a)(1)(iii). In May 2017, the AOJ informed the Veteran that VA received information from the Defense Manpower Data Center (DMDC) that he received military drill pay concurrently while receiving VA benefits. He was provided a VA Form 21-8951, Notice of Waiver of VA Compensation or Pension to Receive Military Pay and Allowances. He was told that, based on this information, VA would take steps to make a retroactive adjustment for the 76 days he was receiving drill pay during FY 2016 (ending September 30, 2016). He was informed of his right to complete the appropriate sections of the VA Form 21-8951, and to indicate to VA that he disputes the number of days listed in the VA Form 21-8951 for which he performed drill. He was provided 60 days from the date of the letter to provide that information to VA. The form provides a place for the Veteran to indicate the number of drill days served, and for him to sign this form, secure the signature of his unit commander or designee, and return the completed form to VA. Later in May 2017, this form, signed by a unit commander, was received, which noted that his proper training days for FY 2016 were 74, not 76. In August 2017, the AOJ sent the Veteran a letter. He was informed that his compensation benefits had been adjusted by $1,775.48 per month from May 1, 2017 to July 17, 2017, based on 76 drill days completed in FY 2016. Also in August 2017, the VA Debt Management Center notified him that this adjustment had resulted in an overpayment of $4,497.88. The Veteran then filed a notice of disagreement in October 2017. The Veteran contends that this was not a properly created debt because VA is attempting to collect compensation payments he should not have received, but he argues he was not receiving compensation payments in 2016 because he took separation pay. In an accompanying narrative statement, the Veteran also disagreed with the number of days in the assessment of his training days, again asserting that the total days he received military pay in FY 2016 was 74. The Veteran also indicated his understanding that VA would adjust for training days starting from April 1, 2017, as that is when he felt he actually began receiving compensation payments. In October 2019, the AOJ issued a statement of the case, at which time the receipt of the corrected information as to the Veteran’s training days was confirmed as having been received in May 2017. The AOJ corrected the number of training days to 74 and reassessed the debt owed for FY 2016 as $4,379.54. Thus, the Veteran contends he had 74 drill days in FY 2016 and VA has assessed the debt based upon 74 drill days in FY 2016. The Board finds that the RO appropriately withheld the Veteran’s VA compensation benefits for 74 drill days in FY 2016. Accordingly, the reduction in the VA disability compensation benefits to offset the concurrent receipt of military drill pay was proper. As to the Veteran’s argument that VA should not collect the debt owed for FY 2016 because he was not receiving compensation payments in 2016 due to his receipt of separation pay, the Board first notes that the Veteran is not challenging the actual separation pay received or any recoupment of his separation pay. He has simply suggested that the FY 2016 debt related to his drill days should not be collected since he was not receiving compensation benefits in 2016 due to the receipt of separation pay. In fact, the record does show he was notified of his award of compensation benefits in October 2015, but was also notified that his payments would be withheld until the separation pay was recouped. An opinion of the VA General Counsel, VAOGCPREC 12-96, held that 10 U.S.C. § 1174 (h)(2) requires that VA recoup from a veteran’s VA disability compensation the amount of non-disability separation pay received by the Veteran under section 631 of Pub. L. No. 96-513. The recoupment of the full amount of disability separation pay that the Veteran received when he was discharged from service by withholding in monthly allotments payments of disability compensation benefits is required by law. 10 U.S.C. § 1174; 38 C.F.R. § 3.700 (a). The law does not allow that the Veteran receive both separation pay and VA compensation. The law requires that the separation pay be recouped. And in this case, it was. The October 2015 letter notified the Veteran that the recoupment of separation pay would be complete as of May 1, 2017 and compensation benefits would begin at that time. Moreover, VA set the date the debt related to the 74 FY 2016 drill days would be recouped to be from May 1, 2017, specifically to avoid any recoupment of the money owed at any time prior to the completion of the recoupment of the separation pay. The AOJ confirmed that the Veteran’s separation pay was recouped fully as of May 1, 2017, and the drill pay withholding for FY 2016 began on May 1, 2017, such that there was no overlap or conflict. Moreover, while the Veteran argues that VA would be collecting a repayment at a time that disability compensation payments were not being paid, the Veteran in fact had the non-disability monies (separation pay) recouped. Thus, the monies paid to represent VA disability compensation. Finally, as the record shows VA was not attempting to collect monies owed for the 74 drill days in FY 2016 at the time he was actively having his separation pay recouped, the Board will not address this argument further. (Continued on the next page)   Because the number of drill days for FY 2016 has been adjusted to 74 and the Veteran agrees that this is the appropriate number of days, and because there is no conflict or overlap between repayment of this debt and recoupment of the Veteran’s separation pay, this appeal is denied. MICHAEL KILCOYNE Veterans Law Judge Board of Veterans’ Appeals Attorney for the Board A. Adamson, Counsel The Board’s decision in this case is binding only with respect to the instant matter decided. This decision is not precedential and does not establish VA policies or interpretations of general applicability. 38 C.F.R. § 20.1303.