N002405
Wednesday, January 16, 2002 8:03 PM
Comment on the Interim Final Rule
Kenneth L. Zwick
Director, Office of Management Programs
Civil Division
U.S. Department of Justice
Main Building, Room 3140
950 Pennsylvania Avenue NW
Washington, DC 20530
RE: Public Comment of on behalf of (victim's wife) on the Interim Final Rule and Request for Comments,
September 11th Victim Compensation Fund of 2001, 28 C.F.R. Part 104
[Civ 104p; AG Order No. 2541-2001] RIN 1105-AA79
I. Commenter's Interest in Commenting
I am writing on behalf of myself and my daughter to comment on the Interim Final Rule
implementing
the September 11th Victim Compensation Fund of 2001 (hereinafter, the "Fund"), which was
established
by the Air Transportation Safety and System Stabilization Act (hereinafter, the "Act"). My
son-in-law of
fourteen years, , was standing watch as the
on September 11, 2001 and lost his life in the Pentagon attack. My Daughter, who is now
left to
raise and support two children under the age of five alone due to the attack, is also now
struggling with
the decision as to whether or not to participate in the Fund.
As my daughter and I struggle to understand the full implications of participation in the Fund, it
is clear
to us that many important issues regarding application of the Interim Final Rule (hereinafter, the
'Rule")
to military victims are not adequately addressed by the Rule. I comment in order to identify
several of
these issues and to urge that these issues be clarified in the final rule. I am sure that many
families of
military personnel lost at the Pentagon share the concerns that are addressed below. We
appreciate your
consideration of our comments and we hope that by clarifying these issues in the final rule
military
families will be better able to make a decision regarding Fund participation.
II. The Nature of the September 11th Victim Compensation Fund
At the outset, I would like to express our family's gratitude for the Fund. On September 11 our
family
and our nation suffered a devastating blow. We are comforted by our government's response and
we
would like to express our appreciation for the promptness by which the Rule was promulgated.
At the same time, however, it must be recognized that the Act is unprecedented in American
history
Never before, to my knowledge, has the United States government simultaneously limited a
potential
wrongdoer's liability and then made the victims choose between using the United States judicial
system
- without knowing the extent of this government-mandated limited liability - or filing a complaint
in the hopes of receiving just compensation from a governmentagency operating under rules that
are somewhat ambiguous and whose decision is not subject to judicial review. I am not an
attorney, but I
question how such a system can be Constitutional. Nonetheless, this is the system in which we
must
operate.
Against this backdrop, I believe that it is your duty to clarify implementation of the
program-including
the items addressed below-to the maximum extent humanly possible. Accordingly, we
respectfully
request that you clear up the issues discussed below when promulgating the final rule.
III. Specific Comments
A. Pre-Filing Presumed Award Determination. The Act requires that each claimant
waive the right to sue "upon the submission of a claim." A significant problem with the current
Rule is
that it lacks any mechanism for the determination of the presumed award applicable to a
particular
claimant before such claimant has filed an actual claim for compensation under the Fund. A few
presumed
award tables have been promulgated, but given that the Rule fails to address how many common
compensation circumstances will be treated under the collateral source rule, the publication of
several
presumed award tables does not provide sufficient information upon which claimants can make a
reliable determination of the presumed award applicable in a particular case. Thus, the current
Rule
forces claimants - i.e., September 11th victims and their families- to "gamble" with their future
by filing a
claim (and thereby forever waiving any judicial review of their claim) in the hopes that they will
receive a
just award determination from the Fund administrators.
Such a situation is not required by the Act. Indeed, there is nothing in the Act which would
prohibit
the Special Master from implementing a procedure by which a particular claimant's relevant
information could be submitted before a claim is filed and then the claimant notified of his or
her
applicable presumed award.
I urge the Special Master to adopt in the final rule a procedure for the determination of the
presumed
award applicable to a particular claimant before a claim is filed. To be effective, the final rule
would have
to required that if a claimant utilized the pre-filing presumed award determination mechanism,
the actual
presumed award used after the claimant filed a claim would be at least as great as the pre-filing
determination.
B. Veterans Administration Payment to Dependent Children. Dependent Children of military
members
Killed in the September 11th attacks are eligible for monthly compensation from the Veterans
Administration (until age 18 or 21). One question that should be resolved when promulgating the
final
rule is whether these payments will be tested as collateral compensation - to the claimant -- and,
if so,
exactly how such payment will be valued.
The plain language of the Act requires that Veterans Administration payment to dependent
children not be counted as
collateral source compensation. More specifically, the Act requires the Special Master
to reduce compensation from the Fund "by the of the collateral source compensation the claimant
has
received or is entitled to receive." This concept is echoed in the comments to the current Rule: "
Moreover,
because the collateral offset only applies to collateral source compensation that the claimant has
received
or is entitled to receive...," Because dependent children who are not the named legal
representative of a
victim are not claimants under the definitions set forth in the Act (and Rule), the final rule should
explicitly provide that Veterans Administration payments to dependent children who are not the
named
personal representative will not be counted as collateral source compensation and offset against
Fund
compensation to claimants.
In my opinion, it is only fair that these Veterans Administration payments should be treated the
same as
payment from charitable organizations, which the Special Master has determined will not count
as
collateral source compensation, in order not to further penalize victims of the Pentagon disaster
more
than other victims of September 11 attacks. I do not mean to distinguish between, as everybody
involved has suffered a tragedy, but it should be recognized that many charities--and indeed
perhaps
the best-known television fund raising event - will provide relief only to the victims of the World
Trade
Center attack. Thus, exempting charitable contributions from the collateral source rule will,
generally
speaking, be more advantages to victims of the World Trade Center attack. Given this, it would
seem
fair that Veterans Administration payments to dependent children of military victims also not be
treated
as collateral source compensation, especially when the plain meaning of the Act would exempt
such
payment from the collateral source rule.
C. Unearned Military Retirement Pay. The Act Specifies that pension funds are collateral source
compensation and thus deductible from any compensation under the Fund. How will unearned
military
retirement benefits be treated under the program? More specifically, many active duty and
reservist
victims of the Pentagon attack were not yet eligible for military retirement pay. Thus, those
victims were
not receiving such pay and their families will never receive such pay now that those victims are
deceased.
But those payments should be considered as supplemental information with respect to future
income of
the deceased members, as these members would have become eligible for such payment in time.
The
final Rule should explicitly provide for the treatment of unearned military retirement pay.
D. 401(K) Funds. The Act specifies that pension funds are collateral source compensation and
thus
deductible from any compensation under the Fund. The Special Master's FAQs indicate that
401(K)
balances will not be treated as collateral source compensation if such balances resulted from the
employee's contribution. How will the Special Master treat 401(k) balances in which both the
employee
and employer contributed? I believe that the final rule should specify that such balances should
also not
be treated a collateral source compensation because the employer's contribution should be treated
as
part of the employee's compensation.
E. Airline Liability Limitation. The Act limits the liability of airlines to the maximum limit of
each
airlines's liability insurance limit. But individual claimants have no way of determining what
such limits
are, short of filing a lawsuit and conducting discovery. I am not sure whether this is within the
Department of Justice's power; however, I believe, that, if possible, part of the final rule should
require
those airlines involved to disclose the limitation of liability that they will assert in court so that
victims
trying to decide whether to participate in the program will know what limitations will apply for
the
airlines should the dispute end up in litigation. I believe that this requirement of airline disclosure
is only
fair, after all, the airlines are getting a tremendous advantage from the Act in that their liability is
capped.
It would thus seem not at all be unreasonable to require the airlines to disclose their liability
limits.
F. Salary increases and inflation factor. Referring to the "Calculation of Economic Loss"
procedure
outlined in Section II of the "Presumed Economic and Non-Economic Loss Table" publication
attached to
the Interim Final Rule, in Step 2 of the procedure certain wage growth assumptions are applied to
the
three-year earnings calculation in Step 1. Individuals between 31 and 50 years of age are assumed
to have
received wage increases of 5.1% per year, and this figured is described as including a 0.5% above
inflation
salary increase and a 1.5% merit increase for workers in this age bracket. In Step 4 of the same
procedures,
an inflation factor of 5.13% is applied to future estimated earnings in order to calculate a present
value.
As the 5.13% inflation factor is greater that the 5.1% salary increase factor, it appears that a
straightforward application of this procedure results in negative constant-dollar salary growth for
all
individuals in this age bracket. At the open forum in Crystal City on January 16, 2002, Special
Master
Feinberg, in response to this comment, stated that this interpretation is incorrect. Please correct
and/or
clarify this procedure to properly indicate what the true salary growth estimates are.
G. Worklife Estimates. Referring again to the "Calculation of Economic Loss" procedure
outlined in
Section II of the "Presumed Economic and Non-Economic Loss Tables" publication attached to
the Interim
Final Rule, estimates of working lifetime are defined by the Bureau of Labor Statistics, "Worklife
Estimates" publication. The only available publication entitled "Worklife Estimates" from the
Bureau of
Labor Statistics is a 1986 document that bases its finding on 1979-1980 labor force data. It may
be
generally assumed that working lifetimes have increase over the 20 years since this data were
taken,
and thus the use fo such vintage data will underestimates the working lifetimes of persons in
2001 and in
turn underestimate their total future earnings. The final rule should accurately cite and make
available
updated worklife estimated from the Bureau of Labor Statistics and discontinue use of 1979-1980
labor
force data.
Respectfully submitted,
Individual Comment
Catonsville, Maryland