article: SECTION 1. SHORT TITLE. This Act may be cited as the ``National Guard and Reserve Education Act of 2004''. SEC. 2. INCREASE IN RATE OF EDUCATIONAL ASSISTANCE FOR MEMBERS OF THE SELECTED RESERVE AS ADMINISTERED BY THE SECRETARY OF VETERANS AFFAIRS. (a) Increase in Rate of Assistance.--Subsection (b)(1) of section 16131 of title 10, United States Code, is amended-- (1) in subparagraph (A), by striking ``$251'' and inserting ``$400''; (2) by striking subparagraphs (B) and (C); (3) by redesignating subparagraph (D) as subparagraph (B); and (4) in subparagraph (B), as so redesignated, by striking ``for each month of less than half-time pursuit'' and inserting ``for each month of less than full-time pursuit''. (b) Effective Date.--The amendments made by subsection (a) shall apply with respect to months beginning after the date of the enactment of this Act. (c) No CPI Adjustment for Fiscal Year 2005.--Paragraph (2) of section 16131(b) of such title shall not apply to rates of basic educational assistance paid under such section during fiscal year 2005. SEC. 3. PAYMENT OF EDUCATIONAL ASSISTANCE FOR MEMBERS OF THE SELECTED RESERVE CALLED UP FOR SERVICE FOR CUMULATIVE PERIOD OF 180 DAYS OR MORE AT THE RATE APPLICABLE UNDER CHAPTER 30 OF TITLE 38, UNITED STATES CODE. (a) Increase.--Section 16131 of title 10, United States Code, is amended by adding at the end the following new subsection: ``(j)(1) In the case of a person described in paragraph (2), the rate payable under subsection (b) or subsection (c) to such person for such educational assistance for each month shall be paid at the rate applicable under section 3015(b) of title 38. ``(2) A person referred to in paragraph (1) is a person who is entitled to educational assistance under this chapter-- ``(A) who, on or after September 11, 2001, serves a period of active duty of at least 180 days of active duty pursuant to an order to serve on active duty under section 12301(a), 12301(d), 12301(g), 12302, or 12304 of this title during a five year period, or ``(B) in the case of a member of the Army National Guard of the United States or Air National Guard of the United States, who, on or after September 11, 2001, performed full time National Guard duty under section 502(f) of title 32 for at least 180 days during a five year period when authorized by the President or Secretary of Defense for the purpose of responding to a national emergency declared by the President and supported by Federal funds.''. (b) Effective Date.--The amendments made by subsection (a) shall apply with respect to payments of educational assistance under chapter 1606 of such title for months beginning after September 30, 2004. SEC. 4. MODIFICATION OF DELIMITING DATE FOR USE OF ENTITLEMENT. (a) In General.--Section 16133 of title 10, United States Code, is amended-- (1) in subsection (a), by striking ``subsection (b)'' and inserting ``subsections (b) and (c)''; and (2) by adding at the end the following new subsection: ``(c) In the case of a person described in section 16131(j)(2) of this title, the period during which such person may use such person's entitlement to educational assistance under this chapter expires at the end of the 14-year period beginning on the date that is the last day of the person's last duty referred to in such section.''. (b) Effective Date.--The amendments made by subsection (a) shall take effect on September 30, 2004, and shall apply to members of the Selected Reserve entitled to educational assistance under chapter 1606 of title 10, United States Code, on or after that date. SEC. 5. AUTHORITY FOR MEMBERS OF THE SELECTED RESERVE ENTITLED TO RETIRED PAY TO TRANSFER ENTITLEMENT TO BASIC EDUCATIONAL ASSISTANCE. (a) Establishment of Authority to Transfer Entitlement.--(1) Chapter 1606 of title 10, United States Code, is amended by adding at the end the following new section: ``Sec. 16138. Transfer of entitlement to basic educational assistance by members of the Selected Reserve entitled to retired pay ``(a) In General.--Subject to the provisions of this section, each Secretary concerned may permit an individual described in subsection (b) who is entitled to basic educational assistance under this chapter to elect to transfer to one or more of the dependents specified in subsection (c) a portion of such individual's entitlement to such assistance. ``(b) Eligible Individuals.--An individual referred to in subsection (a) is an individual who-- ``(1) is entitled to retired pay under chapter 1223; and ``(2) is entitled to educational assistance under this chapter. ``(c) Eligible Dependents.--An individual approved to transfer an entitlement to basic educational assistance under this section may transfer the individual's entitlement as follows: ``(1) To the individual's spouse. ``(2) To one or more of the individual's children. ``(3) To a combination of the individuals referred to in paragraphs (1) and (2). ``(d) Designation of Transferee.--An individual transferring an entitlement to basic educational assistance under this section shall-- ``(1) designate the dependent or dependents to whom such entitlement is being transferred; ``(2) designate the number of months of such entitlement to be transferred to each such dependent; and ``(3) specify the period for which the transfer shall be effective for each dependent designated under paragraph (1). Each designation under this section shall be made in writing and shall be transmitted to the Secretary concerned and the Secretary of Veterans Affairs. ``(e) Time for Transfer; Revocation and Modification.--(1) Subject to the time limitation for use of entitlement under section 16133 of this title, an individual approved to transfer entitlement to basic educational assistance under this section may transfer such entitlement at any time after the approval of the individual's request to transfer such entitlement without regard to whether the individual is a member of the Armed Forces when the transfer is executed. ``(2)(A) An individual transferring entitlement under this section may modify or revoke at any time the transfer of any unused portion of the entitlement so transferred. ``(B) The modification or revocation of the transfer of entitlement under this paragraph shall be made by the submittal of written notice of the action to both the Secretary concerned and the Secretary of Veterans Affairs. ``(f) Commencement of Use.--In the case of entitlement transferred to a child to whom entitlement to basic educational assistance is transferred under this section, the child may not commence the use of the transferred entitlement until either-- ``(1) the completion by the child of the requirements of a secondary school diploma (or equivalency certificate); or ``(2) the attainment by the child of 18 years of age. ``(g) Additional Administrative Matters.--(1) The use of any entitlement to basic educational assistance transferred under this section shall be charged against the entitlement of the individual making the transfer at the rate of one month for each month of transferred entitlement that is used. ``(2) Except as provided under subsection (d)(2) and subject to paragraphs (4) and (5), a dependent to whom entitlement is transferred under this section is entitled to basic educational assistance under this chapter in the same manner and at the same rate as the individual from whom the entitlement was transferred. ``(3)(A) The death of an individual transferring an entitlement under this section shall not affect the use of the entitlement by the dependent to whom the entitlement is transferred. ``(B) Entitlement may only be transferred under this section before the date of death of the individual making the transfer. ``(4) A child to whom entitlement is transferred under this section may not use any entitlement so transferred after attaining the age of 26 years. ``(5) The administrative provisions of chapter 30 of title 38 (including the provisions set forth in section 3034(a)(1) of that title) shall apply to the use of entitlement transferred under this section, except that the dependent to whom the entitlement is transferred shall be treated as the eligible veteran for purposes of such provisions. ``(6) The purposes for which a dependent to whom entitlement is transferred under this section may use such entitlement shall include the pursuit and completion of the requirements of a secondary school diploma (or equivalency certificate). ``(h) Overpayment.--In the event of an overpayment of basic educational assistance with respect to a dependent to whom entitlement is transferred under this section, the dependent and the individual making the transfer shall be jointly and severally liable to the United States for the amount of the overpayment for purposes of section 3685 of title 38. ``(i) Approvals of Transfer Subject to Availability of Appropriations.--The Secretary concerned may approve transfers of entitlement to basic educational assistance under this section in a fiscal year only to the extent that appropriations for military personnel are available in that fiscal year for purposes of making deposits in the Department of Defense Education Benefits Fund under section 2006 of this title in that fiscal year to cover the present value of future benefits payable from the Fund for the Department of Defense portion of payments of basic educational assistance attributable to increased usage of benefits as a result of such transfers of entitlement in that fiscal year. ``(j) Regulations.--After consultation with the Secretary of Veterans Affairs, the Secretary of Defense shall prescribe regulations for purposes of this section. Such regulations shall specify the manner and effect of an election to modify or revoke a transfer of entitlement under subsection (e)(2) and shall specify the manner of the applicability of the administrative provisions referred to in subsection (g)(5) to a dependent to whom entitlement is transferred under this section. ``(k) Annual Report.--(1) As part of the report required under section 3020(l) of title 38, (beginning in 2006), the Secretary of Defense shall include information on the transfers of entitlement to basic educational assistance under this section that were approved by each Secretary concerned during the preceding fiscal year. ``(2) Each report shall set forth-- ``(A) the number of transfers of entitlement under this section that were approved by such Secretary during the preceding fiscal year; or ``(B) if no transfers of entitlement under this section were approved by such Secretary during that fiscal year, a justification for such Secretary's decision not to approve any such transfers of entitlement during that fiscal year.''. (2) Clerical Amendment.--The table of sections at the beginning of such chapter is amended by adding at the end the following new item: ``16138. Transfer of entitlement to basic educational assistance by members of the Selected Reserve entitled to retired pay.''. (b) Conforming Amendment.--Section 3020 of title 38, United States Code, is amended-- (1) by redesignating subsection (m) as subsection (n); and (2) by inserting after subsection (l) the following new subsection: ``(m) Coordination With Authority for Transfers Under the Reserve Montgomery GI Bill.--In carrying out this section and section 16138 of title 10, each Secretary concerned shall take such steps as may be necessary to ensure that a transfer of entitlement under each such section is made pursuant to the applicable requirements of such sections.''. SEC. 7. REQUIREMENT FOR THE SECRETARY OF VETERANS AFFAIRS TO REPORT TO CONGRESS ON TRANSFERS OF ENTITLEMENT BY MEMBERS OF THE SELECTED RESERVE ENTITLED TO RETIRED PAY. (a) In General.--Subchapter II of chapter 30 of title 38, United States Code, is amended by adding at the end the following new section: ``Sec. 3020A. Annual report on transfers of entitlement to basic educational assistance by members of the Selected Reserve entitled to retired pay ``(a) Inclusion in Annual Report.--As part of the annual report submitted to the Congress under section 529 of this title, the Secretary shall include a description of the operation of the program for transfer of entitlement to basic educational assistance by members of the selected reserve entitled to retired pay under section 16138 of title 10. ``(b) Specific Information Required.--The Secretary shall include in the description required under subsection (a) the following information: ``(1) The aggregate number of transfers of entitlement made during the preceding year. ``(2) The type of programs of education pursued by dependents to whom entitlement was so transferred. ``(3) The number of spouses to whom entitlement was so transferred. ``(4) The number of dependent children to whom entitlement was so transferred.''. (b) Clerical Amendment.--The table of sections at the beginning of such chapter is amended by adding at the end the following new item:
summary: National Guard and Reserve Education Act of 2004 - Increases the monthly rate of educational assistance for members of the Selected Reserve who pursue full-time studies. Requires the Secretary of Veterans Affairs to prescribe by regulation the rate of assistance for less than full-time studies. Establishes an educational assistance benefit for reservists and National Guard members who, on or after September 11, 2001, serve at least 180 days within a five-year period of active duty in a contingency operation. Authorizes such persons to use their educational assistance entitlement during a 14-year period beginning on the last day of duty. Authorizes members of the Selected Reserve who are entitled to retired pay and basic educational assistance to transfer a portion of their educational entitlement to eligible dependents. Requires the Secretary to report on such transfers in the Secretary's annual report to Congress.