"I thought that was totally wrong," Davis said. "That's an honorable place for people to go, not a murderer."
Wagner died of a heroin overdose in prison in February while serving consecutive life sentences for the murders.
In July, his ashes were inurned at Arlington, with standard military honors, at the request of his sister, Karen Anderson, a cemetery spokeswoman has said.
Because he was honorably discharged from the U.S. Army in 1972, Wagner was eligible for interment or inurnment there.
Attempts Thursday to reach Karen Anderson were unsuccessful.
Craig, R-Idaho, the committee chairman, and U.S. Sen. Barbara A. Mikulski, D-Md., each said Thursday they'd propose bills to close a loophole that allowed Wagner's ashes to be placed at the national cemetery.
A 1997 law aimed at Oklahoma City bomber Timothy McVeigh says a person convicted of a state capital crime is ineligible to be buried or inurned at a national cemetery if the sentence was death or imprisonment without parole.
Wagner's life sentences included the possibility of parole.
Mikulski's bill proposes striking the phrase "without parole." She introduced her bill Thursday after testifying before Craig's committee.
"Placing the remains of a cold-blooded murderer in this hallowed ground makes a mockery of that service," Mikulski said.
Craig's staff was still working on his own bill version late Thursday.
Jon Towers, a member of the senator's staff, said there were other questions to address, such as the effect of plea bargains. He expected Craig to file a bill next week.
Towers said there was concern about the constitutionality of the bill that calls for the secretary of the Army, who oversees national cemeteries, to remove Wagner's remains from Arlington.
Since Wagner is dead, the bill would not punish him, Towers said. Rather, a clause in the bill says it aims to "preserve the sacredness of cemetery grounds."
Officials representing the Department of Veterans Affairs and veterans groups also testified Thursday.
Craig asked Thurman Higginbotham, Arlington's deputy superintendent, why the cemetery doesn't ask people's families if they were convicted of a capital crime.
Representing five veterans groups, Dennis M. Cullinan, the director of national legislative service for the Veterans of Foreign Wars of the United States, said the groups think veterans should be held to high standards.
"It was our collective conclusion that permitting individuals so undeserving of such honor to be buried in veterans cemeteries would diminish the dignity and service of other veterans and their survivors who are fully deserving of the honor," Cullinan said.
However, the groups are worried that tightening restrictions could lead to "a cascading march" to block other veterans from honors based on "the severity of turpitude of various crimes," he said.
In an interview after the hearing, Cullinan said the veterans groups do not support Craig's effort to have Wagner's ashes removed, which could become the basis for many other requests.