Madam Chairwoman and Members of the Subcommittee:

Thank you for this opportunity to present The American Legion’s view on some of the Department of Veterans Affairs (VA) expiring programs.  The majority of the programs discussed today received increased payments via the passage of the Veterans Benefits Improvement Act of 2004, Public Law (P.L.) 108-454.  Due to the expiration of temporary increased payments on January 1, 2008, many veterans will receive a lower monthly payment for earned education benefits.  The American Legion opposes any reduction in education assistance payments.  The American Legion recommends that the dollar amount of the entitlement be indexed to the average cost of college education including tuition, fees, textbooks and other supplies for a commuter student at an accredited university, college or trade school for which a veteran qualifies.

Demonstration Project of Adjustable Rate Mortgages – Section 3707 and Demonstration Project on Hybrid Adjustable Rate Mortgages – Section 3707a

The American Legion supports the reinstatement of the Adjustable Rate Mortgage Programs that will expire at the end of this calendar year.  Since the VA Home Loan program was enacted as part of the original Servicemen's Readjustment Act of 1944 (the GI Bill), VA has guaranteed more than 18.2 million home loans totaling nearly $938billion for veterans to purchase or construct a home, or to refinance another home loan on more favorable terms.  In the last five years (2001-2006), VA has assisted more than 1.4 million veterans in obtaining home loan financing totaling almost $197 billion.  About half of these loans, just over 730,000, were to assist veterans to obtain a lower interest rate on an existing VA guaranteed home loan through VA’s Interest Rate Reduction Refinancing Loan Program. 

The American Legion also supports administrative and/or legislative efforts that will improve and strengthen the Loan Guaranty Service's ability to serve America's veterans.  H.R. 4884, The Helping Our Veterans to Keep Their Homes Act of 2008, addresses the expiration of these programs.  In reference to the topics before this committee today, The American Legion supports the following portions of the proposed legislation in H.R. 4884:

Section 2 (A)

(c) Extension of demonstration project on adjustable rate mortgages.—Section 3707(a) of such title is amended by striking “2008” and inserting “2018”.

(d) Extension of demonstration project on hybrid adjustable rate mortgages.—Section 3707A (a) of such title is amended by striking “2008” and inserting “2012”.

PROGRAMS AFFECTED BY THE VETERANS BENEFITS IMPROVEMENT ACT OF 2004 (P.L. 108-454)

Apprenticeship and On-Job-Training (OJT)

The American Legion opposes any reduction in education assistance payments.  Due to the expiration of temporary law that increased the OJT payment to 85 percent of the Montgomery GI Bill (MGIB) payment rate in 2005, the OJT payment rate dropped to 75 percent on January 1, 2008.  The OJT payment rates have dropped to $825.75, $605.55, and $385.35.  The American Legion recommends that the dollar amount of the entitlement should be indexed to the average cost of college education including tuition, fees, textbooks and other supplies for a commuter student at an accredited university, college or trade school for which a veteran qualifies.

Approximately 7,000 veterans are immediately affected due to the drop in monthly payment rates.  The American Legion has long advocated for increased education benefits and raising the rates of the entitlement.  Lowering benefits is an insult to all veterans and an extension of the OJT payment rates implemented in P.L. 108-454 should be indefinite. 

Not every veteran is destined for college; therefore, the MGIB needs to be more accessible for those veterans with vocational aspirations other than college.  The overall costs of these vocational training and licensing programs far exceed the monthly stipend provided under the traditional “college-student-for-36-months” approach in the current MGIB.

Veterans should be afforded the opportunity to attend programs that will lead to the vocation of their choice.  In addition, a higher percentage of today’s servicemembers are married (with children in the majority of cases) when they are discharged.  Meeting the financial obligations to sustain and maintain a household is paramount and often serves as a major obstacle to their timely use of the MGIB.  Every effort must be made to empower every veteran with options to make the best vocational choice to help them achieve the American dream.

P.L. 108-454 amended title 38, USC Section 3032 subsection (c) from October 1, 2005 to January 1, 2008. (MGIB-AD):

(1) The reference to ``75 percent'' in subparagraph (A) were a reference to ``85 percent'';

(2) The reference to ``55 percent'' in subparagraph (B) were a reference to ``65 percent''; and

(3) The reference to ``35 percent'' in subparagraph (C) were a reference to ``45 percent''.

P.L. 108-454 amended title 10, USC Section 16131, subsection (d) from October 1, 2005 to January 1, 2008. (MGIB-SR):

(1) the reference to ``75 percent'' in subparagraph (A) were a reference to ``85 percent'';

(2) the reference to ``55 percent'' in subparagraph (B) were a reference to ``65 percent''; and

(3) the reference to ``35 percent'' in subparagraph (C) were a reference to ``45 percent''.

Post-Vietnam Era Veteran’s Educational Assistance Program (VEAP)

The American Legion opposes any reduction in education assistance payments.  Due to the expiration of the P.L. 108-454 that increased the OJT payment to 85 percent of the VEAP payment rate in 2005, the OJT payment rate dropped to 75 percent on January 1, 2008.  The American Legion recommends that the dollar amount of the entitlement should be indexed to the average cost of college education including tuition, fees, textbooks and other supplies for a commuter student at an accredited university, college or trade school for which a veteran qualifies.

P.L. 108-454 amended title 38, USC Section 3233, subsection (a) from October 1, 2005 to January 1, 2008.

(1) the reference to ``75 percent'' in paragraph (1) were a reference to ``85 percent'';

(2) the reference to ``55 percent'' in paragraph (2) were a reference to ``65 percent''; and

(3) the reference to ``35 percent'' in paragraph (3) were a reference to ``45 percent''.

Survivors and Dependents Educational Assistance (DEA)

The American Legion opposes any reduction in education assistance payments due to the expiration of the P.L. 108-454 that increased the OJT payment of DEA recipients in 2005 and dropped on January 1, 2008.

P.L. 108-454 amended title 38, USC Section 3687, subsection (b)(2) from October 1, 2005 to January 1, 2008.

(A) the reference to ``$574 for the first six months'' were a reference to ``$650 for the first six months'';

(B) the reference to ``$429 for the second six months'' were a reference to ``$507 for the second six months''; and

(C) the reference to ``$285 for the third six months'' were a reference to ``$366 for the third six months''.

Incarcerated Veterans Transition Program (IVTP)

The American Legion does not have a position regarding the Incarcerated Veterans Transition Program.

Department of Labor (DOL) Veterans Employment and Training Program (VETS) Claim Referral Program to the Office of Special Counsel (OSC)

The American Legion does not have a position regarding the expiration of the Demonstration Project with the Department of Justice (DOJ) Office of Special Counsel (OSC) with Uniformed Services Employment and Reemployment Rights Act (USERRA) claims. 

CONCLUSION

Former President Franklin Delano Roosevelt once said, “The test of our progress is not whether we add more to the abundance of those who have much, it is whether we provide enough for those who have little.”  Different options for purchase of homes and the ability to afford an education must constantly be provided to veterans.  

The American Legion looks forward to continue working with the Subcommittee to assist the nation’s veterans.  Madam Chairwoman and Members of the Subcommittee, this concludes my testimony.