Citation Nr: 21026679 Decision Date: 05/03/21 Archive Date: 05/03/21 DOCKET NO. 14-33 459 DATE: May 3, 2021 ORDER Entitlement to a total disability rating based on individual unemployability (TDIU) due to service-connected disabilities, prior to October 19, 2020, is denied. Entitlement to special monthly compensation (SMC) based on housebound criteria is denied. FINDINGS OF FACT 1. The Veteran's service-connected disabilities did not preclude him from securing and following substantially gainful employment prior to October 19, 2020. 2. The Veteran does not have a single service-connected disability rated at 100 percent. CONCLUSIONS OF LAW 1. The criteria for entitlement to a TDIU, prior to October 19, 2020, have not been met. 38 U.S.C. §§ 1155, 5107; 38 C.F.R. §§ 3.340, 3.341, 4.16, 4.19. 2. The criteria for SMC at the housebound rate have not been met. 38 U.S.C. § 1114(s); 38 C.F.R. § 3.350(i). REASONS AND BASES FOR FINDINGS AND CONCLUSIONS The Veteran served on active duty from January 1997 to January 2001. The matter arises before the Board of Veterans' Appeals (Board) from the appeal of a November 2009 rating decision, which denied an increased rating for the Veteran's bilateral knee disabilities. The Veteran appealed the rating decision and sought an increased rating for his disabilities. In August 2016, the Veteran testified at a hearing before the undersigned Veterans Law Judge. A copy of the proceeding is associated with the claims file. Subsequently, in a January 2021 decision, the Board found that the issue of entitlement to a TDIU had been raised by the record. Rice v. Shinseki, 22 Vet. App. 447 (2009). The Board remanded the matter to obtain information about the Veteran's employment and earning history as well as to provide him with a VA Form 21-8940, Application for Increased Compensation Based on Unemployability. The requested actions have been completed and the appeal is once again before the Board. See Stegall v. West, 11 Vet. App. 268, 271 (1998). The Board notes that during the appellate period, a March 2021 rating decision assigned a TDIU, effective October 19, 2020. Accordingly, the issue before the Board is whether the Veteran is entitled to TDIU prior to October 19, 2020. Entitlement to a TDIU The Veteran seeks entitlement to a TDIU from December 15, 2018. Total disability ratings for compensation based on individual unemployability may be assigned where the schedular rating is less than total if it is found that the disabled person is unable to secure or follow a substantially gainful occupation as a result of (1) a single service-connected disability ratable at 60 percent or more, or (2) as a result of two or more disabilities, provided at least one disability is ratable at 40 percent or more, and there is sufficient additional service-connected disability to bring the combined rating to 70 percent or more. See 38 C.F.R. §§ 3.340, 3.341, 4.16(a). Entitlement to a TDIU requires the presence of impairment so severe that it is impossible for the average person to secure and follow a substantially gainful occupation. See 38 U.S.C. § 1155; 38 C.F.R. §§ 3.340, 3.341, 4.16. In reaching such a determination, the central inquiry is "whether the veteran's service-connected disabilities alone are of sufficient severity to produce unemployability." Hatlestad v. Brown, 5 Vet. App. 524, 529 (1993). Consideration may be given to the veteran's level of education, special training, and previous work experience in arriving at a conclusion, but not to his age or the impairment caused by nonservice-connected disabilities. See 38 C.F.R. §§ 3.341, 4.16, 4.19. Here, the Veteran meets the criteria for schedular TDIU when considering the bilateral factor for his bilateral knee disabilities and bilateral lower extremity radiculopathy. Thus, the remaining inquiry is whether the Veteran's service-connected disabilities precluded employment prior to October 19, 2020. The Veteran filed an Application for Increased Compensation Based on Unemployability, VA Form 21-8940, in January 2021, indicating that he worked full-time as a correctional specialist/case manager until December 14, 2018. He also indicated that began working a contractor in January 2019. He reported that while working a contractor, he worked 10-hours per week and that his highest gross earnings per month were $1,000. A June 2020 VA psychiatric examination noted that the Veteran worked as a substance abuse counselor for nine years and was currently self-employed as a contractor. The Veteran reported working 60-hours, sometimes more, and that he was doing well in business. A March 2021 Request for Employment Information in Connection with Claim for Disability, VA Form 21-4192, indicates that the Veteran is the owner and operator of a renovation and remodeling business. He indicated that he works when he can and earned $19,000 in the past 12-months (before deductions). The Veteran stated that he is self-employed because he has difficulty obtaining and maintaining employment due to his anxiety and constant aches and pains. Marginal employment is not considered to be substantially gainful employment. 38 C.F.R. § 4.16(a). Marginal employment generally shall be deemed to exist when a veteran's earned annual income does not exceed the amount established by the U.S. Department of Commerce, Bureau of the Census, as the poverty threshold for one person. Id. Marginal employment may also be held to exist, on a facts-found basis, when earned annual income exceeds the poverty threshold. Id. This includes, but is not limited to, employment in a protected environment such as a family business or sheltered workshop. Id. As such, "a veteran can establish marginal employment either by demonstrating an income less than the poverty threshold established by the U.S. Census Bureau or by the facts of his particular case." Ortiz-Valles v. McDonald, 28 Vet. App. 65, 71 (2016). During the appellate period, the Veteran has worked as a contractor operating his own renovation and remodeling company. The record contains several inconsistencies regarding the Veteran's earned income and his ability to work. The Board notes that the Veteran's actual earned income is not known as the Veteran has reported that his highest gross earnings were $1,000 per month in January 2021 but later reported that he made $19,000 in the past 12-months in March 2021. No financial documentation or income forms have been provided. Additionally, the Board notes that the Veteran reported that his business was doing well and that he was working 60 hours per week in June 2020. Accordingly, the evidence of record is against finding that the Veteran's annual salary as a self-employed contractor and owner of a renovation and remodeling company was below the poverty threshold during the appellate period and therefore does not meet the definition of "marginal" by VA standards. See Poverty Thresholds, U.S. Census Bureau, http://www.census.gov/data/tables/time-series/demo/income-poverty/historical-poverty-thresholds.html (last visited April 26, 2021). As mentioned above, marginal employment may also be held to exist, on a facts-found basis when earned annual income exceeds the poverty threshold. The Board recognizes that the Secretary, as of this decision, has not defined "protected environment." As such, said determinations must be made on a case-by-case basis based on the information and evidence of record. In this case, the Veteran's work as a self-employed contractor and owner and operator of a renovation and remodeling business does not constitute a protected environment. The evidence of record does not reflect that his employment is similar to a family business or a sheltered workshop. The Board acknowledges that the Veteran has asserted that he has had to subcontract work that he cannot physically perform due to his service-connected disabilities. However, the evidence indicates that while the Veteran is not able to physically perform various construction jobs/tasks, he is able to perform clerical work such as subcontracting out various jobs, overseeing renovations, and collecting payment for the services rendered. Additionally, the Board notes that as the owner of his business, the Veteran is able to work a flexible work schedule and has the ability to conduct business and coordinate from home. See March 2021 VA psychiatric examination. The evidence of record establishes that he is able to successfully serve as an owner and operator of a business generating nonmarginal income within the relevant competitive market in which the business operates. Thus, his job as the owner and operator of the business does not constitute marginal employment on the basis of a protected environment. The Board notes that the agency of original jurisdiction's (AOJ) determination that the Veteran's self-employment as a contractor is marginal is not binding on the Board. Rather, the Board has considered the evidence of record, to include the Veteran's statements, and finds that the Veteran's self-employment as a contractor and owner and operator of a renovation and remodeling business does not constitute marginal employment for the period now under review as he has not been prevented from securing and following substantially gainful employment as a result of his service-connected disabilities. Therefore, the benefit of the doubt doctrine is not applicable, and the claim for a TDIU prior to October 19, 2020 is denied. See 38 U.S.C. § 5107(b); 38 C.F.R. § 3.102. Entitlement to SMC The Veteran seeks entitlement to SMC. Specifically, he contends that the AOJ failed to consider whether he was entitled to a TDIU due solely to his service-connected unspecified anxiety disorder. SMC at the housebound rate is payable where a veteran has a single service-connected disability rated as 100 percent and, in addition: (1) has a service-connected disability or disabilities independently ratable at 60 percent, separate and distinct from the 100 percent service-connected disability, and involving different anatomical segments or bodily systems, or (2) is permanently housebound by reason of service-connected disability or disabilities. See 38 U.S.C. § 1114(s); 38 C.F.R. § 3.350(i). The Board finds that SMC based on the housebound rate is not warranted because the Veteran does not have a single, permanent service-connected disability rated at 100 percent disabling. In Bradley v. Peake, 22 Vet. App. 280, 293 (2008), the Court held that a TDIU satisfies the total (100 percent) rating requirement if the TDIU evaluation was, or can be, predicated upon a single disability and there exists additional disability or disabilities independently ratable at 60 percent or more, for purposes of entitlement to SMC for a housebound rating. In other words, 38 U.S.C. § 1114(s) for housebound benefits does not limit "a service-connected disability rated as total" to only a schedular rating of 100 percent. Id. A TDIU rating based on a single disability is permitted to satisfy the statutory requirement of a total rating. Id. In addition, the Bradley decision also stated that the decision to treat multiple disabilities as one under 38 C.F.R. § 4.16(a) was specifically limited to TDIU ratings. See Youngblood v. Wilkie, 31 Vet. App. 412 (2019). That is, a TDIU rating based on multiple service-connected disabilities does not satisfy the criteria for one total disability in considering entitlement to housebound benefits under 38 U.S.C. § 1114(s). Here, the Veteran's TDIU was based on the aggregate impact of both his service-connected psychiatric and physical disabilities. The evidence does not show that he is unable to secure or maintain substantially gainful employment solely due to his unspecified anxiety disorder, rated as 50 percent disabling. Further, this psychiatric rating does not meet the schedular criteria on its own. Therefore, here, although a TDIU results in a total rating, it does not result in a single, permanent service-connected disability rated at 100 percent disabiling and additional independently rated service-connected disabilities rated at 60 percent or more. As a result, entitlement to SMC at the housebound rate is not warranted, and the claim is denied. Nathaniel J. Doan Veterans Law Judge Board of Veterans' Appeals Attorney for the Board C. Robinson, Associate 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.