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COMMITTEE ON VETERANS AFFAIRS, 

U.S. HOUSE OF REPRESENTATIVES

Mr. Chairman, distinguished Members of the Committee:

It has been 11 years since I last had the privilege to appear before a committee of this august body.

At that time I was completing four years as Assistant Secretary after having served two years as Deputy Assistant Secretary of Labor for Veterans Employment and Training. It was a personally gratifying period during which I had the opportunity to participate in building, from the ground up, the agency for delivery of job and job-related services to our Nation’s military veterans.

My two years as Deputy Assistant Secretary were logged under history’s first Assistant Secretary for Veterans Employment and Training, William C. Plowden, Jr., who taught me not only the basics of the veterans’ job training and placement programs but also a lot of common sense about administering the programs. I highly recommend the excellent history of the Title 38 program that he has written and submitted for the record of this hearing today.

My very first accomplishment under Mr. Plowden’s direction was to give the organization its name -- the Veterans Employment and Training Service -- abbreviated appropriately and accurately into the acronym VETS.

Another of my challenges was to recall Federal funds we had allocated to the States that either were not used or were spent for providing services to non-veterans in violation of Title 38 of the United States Code.

With the money we "re-captured" from the States the first year after we used a computerized system to identify the unspent and misspent funds we started the National Veterans Training Institute which is still operating today at the University of Colorado Denver.

We had learned with a jolt that many of the people whose salaries were funded by the United States Government to provide much-deserved and much-needed employment services to our military veterans through the local Job Service offices did not know what they were tasked to do -- nor what they were NOT supposed to do -- as defined by Federal law. And their supervisors in many offices knew even less about the requirements of the law for the duties of the Disabled Veterans Outreach Program Specialists (DVOPs) and Local Veterans Employment Representatives (LVERs) who at that time were working in, and out of, approximately 2,200 local Job Service offices.

I am not criticizing the state employment security agencies. They were doing the best they could without clear guidance for years from the veterans’ unit that previously functioned within the Labor Department’s Employment and Training Administration (ETA). When Congress in its wisdom separated the veterans’ program from ETA and created VETS as a stand-alone entity under the direction of a Presidentially-appointed Assistant Secretary, we drew the line and the states for the most part did not violate it.

Today, every person working for the Labor Department or paid with funds provided by the Labor Department through VETS knows his or her job, and has been trained and re-trained or "updated," as often as necessary, for that job. Additionally, the training system that was established by VETS has provided, and continues to provide, coordinated training for service delivery personnel of other Federal as well as State agencies that have responsibilities impacting on the ability of VETS and the local Job Service offices to place veterans in jobs they not only can handle but can hold.

Now the real test comes. Are we ready for the 21^st Century? Can we make ourselves ready, without even knowing what the morrow will bring, much less the day after tomorrow, the next month or year, or the next 50 to 100 years?

I commend this committee, the sponsors of this legislation, and everyone who has worked on the legislation for rising to the challenge and opening your minds to the options.

Today, unlike previous times, I have the cherished freedom to speak without the muzzle and shackles of clearing my testimony through the Office of Management and Budget. I shall respect this freedom and speak responsibly as well as candidly.

First, I firmly offer these observations:

1. VETS and the veterans who need the agency’s services are being rendered a disservice by a numbers system that doesn’t add up, that doesn’t accurately calculate or count the number of veterans by the several categories served and the various types of services delivered. Granted, the current system is "free" in that it is furnished at no cost to VETS or the veterans’ programs. But its failure to provide true accountability puts all the programs at risk of budget decimation. Blaming the VETS agency for not accurately reporting results from a flawed system over which it has little or no control is wrong, except to the extent the agency has not convinced the Secretary of Labor to recommend to Congress a sufficient budget to pay for a true and correct reporting system.

I became aware of this problem when I obtained two different sets of figures from two different sources both of which were "official." I still was able to determine that more veterans probably are being reached and served today than when I headed the agency.

H.R. 4765 addresses this problem forthrightly.

2. Veterans delivering employment-related services to veterans is the most effective method. It is prescribed by law now in the requirement that all State Directors and Assistant State Directors of VETS as well as all DVOPs and LVERs hired by state employment agencies with VETS funds be eligible veterans themselves. H.R. 4765 would allow the appointment of non-veterans as State Directors and Assistant State Directors of VETS, and would eliminate the requirement that DVOPs and LVERs be veterans.
   These changes would weaken the service delivery system and send the wrong message to veterans, to the states, and to private employers with Federal contracts who are monitored by DVOPs and LVERs to determine whether those employers are meeting their veteran affirmative action requirements for hiring veterans.
3. Establishing service delivery positions by formula based on veterans’ needs and then providing funds to pay for markedly fewer positions than the formula prescribes is dishonest. It tells the Nation’s veterans and the state service delivery agencies that the Federal government cares more about holding down costs than about meeting veterans’ needs. H.R. 4765 would allow a continuation of this method of weakening and watering down the system, a process started years ago to prevent budget increases. Mr. Plowden in his statement documents the impact by pointing out that DVOPs have been reduced from 2,000 to 1,445 positions, more than a 25 percent cut, and LVERs from 1,600 to 1,317 positions, based on funding alone.
4. I do not believe it is good policy to authorize appointment of non-residents to the positions of State Directors and Assistant State Directors of VETS, as H.R. 4765 would do. Local talent rising through the local Job Service offices and veterans’ organizations establishes a bond that makes for smooth, minimally-interrupted transition when VETS Directors and Assistant Directors retire or move on to better-paying jobs. Local people working with local people builds trust, confidence and continuity into the system. It encourages the "locals" to strive harder in jobs that prepare them for promotion to Federal positions in their home states.

The beauty of H.R. 4765 and the comprehensive legislative proposal that the American Legion is presenting today is that all of us are challenged to look into the distant future, suggestively as far as 100 years ahead.

Knowing the hand the Twentieth Century dealt the United States in growth and development of military and economic power, can you imagine what it would have been like to sit in this group in the year 1900 to discuss veterans’ benefits for the century ahead?

Mr. Plowden and others have told us how the system has served veterans in the past, and how it is serving them today.

What I believe we need to know that we do not know today is three-fold: 1) How many of our Nation’s veterans need employment-related services but are not getting them? 2) What services do they need, and how can the system reach them? 3) Is there any yet-to-be-acknowledged group that needs employment-related help and has a justifiable, logical right or reason to receive it?

This is an exciting and challenging exercise!

In answer to the first question, I believe there is a large bloc of tragically hurting veterans that the existing system is not reaching because they do not know how to find or access it; or, they have been in the system and it hasn’t worked for them the way they had hoped, expected, or needed; or, the system is so caught up in bureaucratic chores that it does not have the time, personnel or money to go looking for and finding them.

I will describe briefly three cases, two of which came to my attention shortly before I was invited to testify here.

John Halbig is confined at St. Elizabeth’s Hospital here in Washington, awaiting trial on a felony charge for leaving a halfway house where he was being held for the misdemeanor offense of not having the money on his person to pay a $15.00 restaurant bill at Washington’s Union Station.

John is a 100 percent disabled veteran of 10 years’ active duty in the Marine Corps, including two tours in Vietnam, the first as an enlisted man servicing helicopters and calling shots as a forward air controller for the 7^th Marine Division, and the second as an

F-4 Phantom jet pilot. His disability is for Post Traumatic Stress Disorder (PTSD), for which he was treated six months in 1984 and three months in 1988 at the Menlo Park, California, mental health center attached to the Palo Alto Veterans Administration Medical Center. He says he became an alcoholic, went through two marriages, and was arrested a number of times on misdemeanor counts stemming from his drinking.

The one thing John has wanted since his discharge from military service is a self-satisfying, successful job. He wants to be a hydrologist. He told me he has been trying for 10 years to get V.A. approval to enroll in a program to study hydrology at the University of Arizona. In 1990, when the University accepted him for enrollment, Mr. Halbig said his V.A. rehabilitation counselor told him he needed to prove first that he could work, and offered to get him a job for six months with Good Will Industries. Mr. Halbig said "no thanks," and a period of drinking and misdemeanor scrapes with the law followed. Now he is waiting to be tried on a felony charge of escaping from a half-way house where he had been sent for a misdemeanor.

The pastor of our church introduced me to Mr. Halbig on the telephone and asked me to help him. I found he was excruciatingly distraught over the felony charge. I called his lawyer, who is court-appointed and not a veteran. I told him that he should drive home to the judge the fact that this man had served two tours fighting for our country in Vietnam, and had come home with a disease of mental flashbacks and wartime memories called PTSD for which he obviously had not received adequate medical or psychiatric treatment. I told him further that it would be a mark of shame on the legal system to allow a man with his military background to be branded a felon and go to jail for leaving a halfway house where he had been sent for not paying a $15.00 bill.

A big gap in communication occurred somewhere long before the felony charge in this case. The employment outreach system that was designed and funded to serve him did not find Mr. Halbig, and he did not find the system. He is 58 years old now, at least 15 years of his life lost to aimless activity and despair because he didn’t find or get a job.

Permit me to cite a second case. George P. Davis, Jr., was graduated with distinction from the U.S. Naval Academy, served as Navigator on the USS Pensacola, transitioned to meteorology and oceanography, was graduated with honors from the Naval Postgraduate School, and attained the rank of Commander in 1996 while serving as Officer in Charge of the Naval Training and Meteorology Department in Newport, R.I.

In 1997 George began going through marital problems that resulted in separation, divorce, and treatment for depression. Alcoholism came into the picture, and he went through a two-week treatment program for it while on Christmas leave. A two-years-early transfer to the position of Deputy Commandant of the Defense Mapping School at Fort Belvoir, for which he did not feel qualified, was the trigger for worse things to come.

In December 1998 George was arrested for DUI. He started out-patient rehabilitation but could not stop drinking. He faced the charges, was reprimanded, and was recommended to go before a "show cause" board to prove he was fit to continue service. While waiting for the hearing he started drinking again, missed work, reported for work under the influence of alcohol, and was placed in maximum security in the Marine Corps brig at Quantico to await show-cause proceedings. The "system" was adding stress. It was not reducing stress or allowing him to deal with it.

After one month in the brig, George requested and received permission to take all of his earned leave in order to attend a private in-patient alcohol rehabilitation facility. He returned to work and moved into a half-way house in Alexandria. The week prior to his show-cause hearing he was arrested a second time for DUI, was hospitalized for alcohol poisoning, and was sent back to the brig. Rather than face a General Court Martial and a felony charge, he opted to resign from military service. He was informed that he could resign under dishonorable conditions. With the help of a member of Congress, George managed to upgrade to a General Discharge after two more months in the brig. On 23 December 1999 he was escorted from the brig to the Anacostia Naval Station where he signed discharge papers and, at 11 o’clock at night, was escorted to the gates and released from service with no place to go except a homeless shelter.

Today George is working in a minimum-wage job provided to him by a member of Alcoholics Anonymous who met him through the A.A. program.

Again, the "system" operated by VETS did not reach a person who clearly needed it, and George, despite his extensive history of military training capped by command positions, knew nothing of the existence of the system much less how to find it. Obviously, the military had had enough of George and just wanted to get rid of him.

I am submitting a statement written by Mr. Davis for the record of this hearing, Mr. Chairman and Members of the Committee, because it clearly shows he accepts responsibility for his unacceptable actions and is doing the right things to turn his life around.

I point no blame at VETS, at the Congress, or at anyone else. It is my purpose solely to help find the cracks so they can be plugged in the interest of improving the system. The fact these two cases came to my attention in the relatively sterile world where I circulate in retirement tells me there are a lot more cracks out there that need to be filled.

The training program at the National Veterans Training Institute is doing a good job of preparing service delivery personnel for their many-faceted jobs in various Federal and state agencies. But government is so big and complicated, and so hard for "the little guy on the short end of the big stick" to reach to ask for help, that something more needs to be done.

I recommend that an "ombudsman" type unit be established within VETS, with additional funding provided specifically for it. The unit would consist of a small group of highly skilled and trained casework supervisors with a 1-800 phone number that could be accessed 24 hours a day. Availability of the service should be advertised nationwide.

In Scandinavian countries where "ombudsman" originated, the word

normally means a commissioner appointed by a legislative body to hear and investigate complaints by citizens against government officials or agencies.

For our veterans’ purposes, I suggest that the unit operate in VETS under the direction of the Assistant Secretary because: 1) The ultimate objective of every veteran’s problems is a successful, self-satisfying and financially supporting job; and 2) The VETS system from the top down through the State Directors, Assistant State Directors, DVOPs, and LVERs is designed and the personnel are trained to apply "the whole person concept" in every case.

"Whole person concept" means that the system, before referring a veteran to a job, makes sure that he or she receives corrective treatment, or counseling, or job training, for any problem or shortcoming that would prevent the veteran from successfully performing and thus holding the job.

It might be a health problem, alcohol or drug addiction, lack of skills or training needed, or any kind of rehabilitation to counteract a disability, just to name a few examples.

This "whole person" approach was established on my watch and continues today as the founding principle for training all service delivery personnel at NVTI who provide employment services to veterans.

The ombudsman unit should consist of personnel trained to know and be able to access every government and private channel or resource available to provide services needed -- the Veterans Administration, Department of Education, Department of Labor, Department of Health and Human Services, Department of Defense, reputable charitable organizations, etc. More importantly, the unit should have direct contact to DVOPs and LVERs trained to access all resources, private as well as public, at the local level, so that the system works smoothly in a hurry to respond to emergencies.

Employees making up the ombudsman unit should be trained and prepared to talk with lawyers, judges, police officers, doctors, any person of authority or responsibility who comes in contact with a veteran who needs help in an emergency. They should be advocates for the veteran. They should be trained to take the position that the veteran is right until proven otherwise. Of course, all VETS and VETS-funded staffers are prepared at all times to call on veterans’ organizations for help when needed.

Our soldiers, sailors, marines and airmen never knowingly leave a comrade on the battlefield to die or be run over by the enemy. Risks are taken, at almost any cost, to save a life. We need the same spirit of comradeship in this mission.

The ombudsman unit should be the most user-friendly agency in the Federal government. It should be a shining example of user-friendliness. It should shine brightly in contrast against a Washington Federal establishment today where it’s a blessing to reach a live voice when one calls on the telephone.

I recommend further in this connection that Federal contractors, who are required by Title 38 to exercise affirmative action to hire veterans, be made eligible to receive services of the ombudsman unit in resolving contract difficulties and snafus with Federal contracting agencies – difficulties that threaten veterans’ jobs or employment rights if not resolved.

These contractors, many of whom are veterans themselves or companies headed by veterans, are, as a group, among our veterans’ best friends when it comes to job development, hiring, and advancement in employment. They have to be our friends because they are a substantial body of "captives" who by law must list their job openings with the Employment Service and are contacted regularly by LVERs or DVOPs to help them comply with the law.

I am taking the liberty of bringing to your attention now a case of rank discrimination bordering on malfeasance by the Department of Defense against a contractor who is a veteran continuing against overwhelming odds to try to serve his country.

Alan Frederickson’s first proposal to convert a former Soviet military factory into a civilian manufacturing plant under the Nunn-Lugar Defense Conversion Program gathered dust for a year before it was rejected. His second proposal was rejected on submittal, without review, because it was deemed five minutes late by the contract officer, despite the fact Mr. Frederickson had arrived at the prescribed destination ahead of time but his presence was not acknowledged. He appealed, but dropped his appeal when the discriminatory procedure was corrected and the project re-advertised several months later. Then he lost to a competitor who had been given the benefit of an exit interview that Mr. Frederickson had missed because of the contract officer’s erroneous five-minute ruling on the first proposal.

Those setbacks did not discourage Mr. Frederickson. He submitted another proposal and, after waiting 13 months, was awarded a $4.1 million cost-share contract to establish a joint venture basic manufacturing (die casting) business in Ukraine. The contract award itself was delayed three to six months because of the way the Defense Nuclear Agency, now the Defense Threat Reduction Agency, handled a complaint that triggered a General Accounting Office investigation. Because of the delay, Mr. Frederickson lost his management team and his Ukraine partner’s organization changed.

Mr. Frederickson put together a new management team, found a new Ukraine partner, manufactured high-technology components of die casting machines in the United States, shipped them to Moldova, and mated them with Moldova-manufactured working ends of the machines . He also located high-technology Russian furnaces for use in the Ukraine operations, and developed a technology transfer program to bring that technology to the United States. He obtained U.S. Defense Department promises to provide funds in accord with an agreement signed with the Ukraine Government to complete the project. That was more than two years ago.

At about that same time, Mr. Frederickson learned from a subpoena served on him from the United States Attorney’s office that he had been under investigation by the DoD Inspector General for some months for criminal fraud. He was instructed to turn all records of the project and his personal life over to the IG investigator. He complied fully. He did not engage a lawyer because he knew he had done nothing wrong. The investigation lasted three years, turned up no unlawful misdeeds, and concluded with a telephone conversation in which the investigator told him he was "cleared" but could not say so in writing because it was against DoD policy to provide that "courtesy."

Today, the $3 million worth of equipment designed and built for the project under Mr. Frederickson’s contract has been gathering dust in a warehouse in Kiev and a factory in Moldova for more than two and a half years.

A year and a half ago, in response to a letter from Senator Strom Thurman as Chairman of the Senate Armed Services Committee, Secretary of Defense William Cohen said it was DoD’s intention to provide the funds to complete the project.

In January this year, after thorough review, the office of Assistant Secretary of Defense for Policy Dr. Edward L. Warner III determined that Mr. Frederickson’s firm would receive $560,000 to complete the project. In May, after further consideration, Dr. Warner directed the Defense Threat Reduction Agency to add $560,000 to Mr. Frederickson’s contract in order to complete the contract.

Less than a month later, on June 16, without notifying either Secretary Cohen or Assistant Secretary for Policy Warner, a man by the name of Edward L. Archer, who identified himself as Contracting Officer for the Defense Threat Reduction Agency, informed Mr. Frederickson that there will be no additional funding, that the contract will be closed out, and that he will seek "an equitable property distribution" of the equipment. The most outrageous aspect of this action is that DTRA for two years has refused to answer Mr. Frederickson’s questions about what DTRA plans to do with the jointly-owned equipment if DoD does not provide the additional funds to complete the project.

Mr. Archer’s letter over-rode a series of higher Department of Defense policy decisions up to and including the Secretary of Defense himself.

Some three weeks before Mr. Archer’s letter, one of Mr. Frederickson’s business associates in Ukraine informed him that someone was making arrangements to remove the equipment from the factory in Moldova where it was waiting for DoD funding to transport it to the former Soviet military manufacturing plant in Kiev where it was to be put into operation.

Mr. Frederickson notified DoD, only to learn that Mr. Archer’s agency had contracted with a private transportation company to move the equipment without notifying Mr. Frederickson or his Ukrainian partners. Mr. Frederickson retained a lawyer who told Mr. Archer and the top management officials of the Defense Threat Reduction Agency to "cease and desist from any efforts to relocate the equipment unless and until it (DTRA) receives written consent" from Mr. Frederickson’s company to do so, stating "DTRA’s unilateral unauthorized actions and failure to communicate evidence a clear lack of good faith and unwillingness to abide by the law."

I respectfully point out, Mr. Chairman and members of the Committee, that DTRA is the agency primarily responsible for protecting the United States against nuclear missile attack by dismantling and disposing of former Soviet missiles to prevent them from falling into rogue hands. I hope and pray their performance on Mr. Frederickson’s contract does not mirror their capability to find, dismantle, and dispose of former Soviet nuclear missiles and warheads.

Submitted herewith for the record is a two-page letter to me from Mr. Frederickson urging that Federal contractors who are veterans be given access to an ombudsman-type office such as I have proposed in the Department of Labor to assist them in such problem areas as he has encountered with the Department of Defense. Incidentally, he speaks highly of the LVERs who call on him from time to time, as one did just 10 days ago, to monitor his hiring of veterans.

In conclusion, I repeat the statement I made prior to citing specific examples, that we need to know: 1) How many of our Nation’s veterans need employment-related services but are not getting them? 2) What services do they need, and how can the system reach them? 3) Is there any yet-to-be-acknowledged group that needs employment-related help and has a justifiable, logical right or reason to receive it?

Thank you, Mr. Chairman and members of the Committee, for giving me the opportunity to share with you my thoughts and views on H.R. 4765 and the veterans’ employment and training needs for the 21st Century

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