Joint Hearing of the Committee on Homeland Security and Governmental Affairs of the U.S. Senate and the Committee on Veterans’ Affairs of the U.S. House of Representatives at 1:00 p.m. CDT.
Witness Testimony of The Honorable Bruce E. Kasold, Chief Judge, United States Court of Appeals for Veterans Claims
MR. CHAIRMAN AND DISTINGUISHED MEMBERS OF THE SUBCOMMITTEE:
I am pleased to appear before you again and to present testimony on the fiscal year (FY) 2013 budget request and performance plans of the United States Court of Appeals for Veterans Claims. My remarks today will (1) summarize our budget request, (2) provide an update on the Court, its caseload, and its Operation Plan, and (3) touch on two important initiatives I have mentioned in the past – a broad examination of the structure of federal appellate review of veterans benefits decisions, and the Veterans Courthouse project.
I. Budget Request
The Court's FY 2013 budget request totals $32,480,700. This request is comprised of two parts – the Court's necessary operating expenses of $29,754,700, and a request by the Veterans Consortium Pro Bono Program (Pro Bono Program) for $2,726,000. Since FY 1997, the Pro Bono Program's budget request has been provided to Congress as an appendix to the Court's budget request. Accordingly, I offer no comment on that portion of our budget request.
As to the Court's operating expenses, our FY 2013 request reflects an increase of $1,710,700 over our FY 2012 appropriation. This increase results primarily from (1) an increase of $1.443M in the statutorily required contribution to the Court of Appeals for Veterans Claims Retirement Fund (Retirement Fund or Fund) (see 38 U.S.C. § 7298); (2) an increase of $455K in payroll compensation and benefits; and (3) a decrease of almost $190K in the Court's other operation expenses.
As to the Retirement Fund expense, as I noted in my testimony on the budget last year, upon becoming Chief Judge in 2010 I initiated a review of the Fund and the Court's past contributions. I noted that our internal budgeting for this expense routinely had been underestimated, resulting in an insufficient appropriations request and requiring funds originally planned for other activities, but not ultimately expended for those purposes, to be contributed to the Fund at the end of the year to reduce the unfunded liability pursuant to 38 U.S.C. § 7298. One reason for the past-years under-budgeting was that estimates were based on an anticipated average 5% growth in the Fund. In reality, there was less than .25% growth (the funds are invested in Treasury instruments), and that alone accounted for a guaranteed shortfall of about $1M at the end of the fiscal year. The same will occur each year that the actual interest return is less than the projected.
This low growth performance was taken into consideration in our FY 2012 budget request, although that was only a partial fix. Since submission of last year's request, with the assistance of the Court's actuary, we have further refined what is necessary to maintain the statutorily required funding with the goal of significantly reducing the need for end-of-year funding from appropriations provided for other purposes but not used. Our FY 2013 budget request of $3.8M reflects the funding necessary to maintain, on an actuarial basis, full funding through FY 2013.
For FY 2013 the Court requests $18.318M for Personnel Compensation and Benefits, an increase of $455K from FY 2012. The number of full time employees remains at 127, unchanged from FY 2012. The Court's appropriations request covers anticipated expenses for employees including salary, health benefits, insurance, and employee matching contributions to the Thrift Savings Plan, as well as routine promotions.
For FY 2013 the Court requests $7.637M for all other operation expenses ("Other Objects"), a decrease of nearly $190K from FY 2012. These funds are used to satisfy the Court's daily operations needs, and cover such expenses as rent, contract services, communication and utility expenses, equipment, furniture, supplies, subscriptions, travel and transportation, and printing expenses. These funds will also support enhancements to our capability to sustain continued operations in accordance with changes in the Court's Continuation of Operation Program (COOP) plan.
II. The Court, its Caseload, and its Operations
Since its creation in 1988, the Court has become one of the busiest federal appellate courts based on the numbers of appeals filed and decided per judge.
Over the past five years approximately 4,500 appeals and petitions have been filed annually at the Court, although last year the number of appeals and petitions dropped to just over 4,000. This likely is reflective of fewer Board decisions denying benefits, as our history of appeals generally tracks the rise and fall in the number of Board decisions that deny benefits. In addition to appeals and petitions filed, the Court receives hundreds of motions each month, each requesting that the Court take some action.
In FY 2011, on top of the significant number of motions, the Court, as a whole, disposed of over 7,500 matters, including over 4,600 appeals, over 2,500 applications for attorney fees and expenses, over 160 petitions, and hundreds of requests for reconsideration or panel review. Although short one permanent judge due to retirement, and two additional judges who are authorized if appointed by the end of this year, the Court has managed to decide more cases than ever before. This has been the result of 1) tremendous focus and effort by the active and senior judges and Court staff, 2) additional, temporary hires, and 3) managerial adjustments to streamline and facilitate the review process.
As I have testified to before, on becoming Chief Judge I examined our review process and noted two areas of un-programmed delay. One was the time it took to decide cases once they were assigned for judicial review, and second was the time it took our Central Legal Staff (CLS) to prepare case summary and research memoranda in advance of forwarding cases for judicial review. With regard to judicial review, it must be recognized that quality significantly trumps quantity. With a continuous eye on quality, we also have focused this past year on the number of cases in chambers pending decision. We made some administrative adjustments and hired some temporary staff, and I am pleased to report that virtually all cases assigned to chambers are now being decided within 90 days of that assignment, not including cases sent to panel or stayed pending decision in another case that might govern the result.
With regard to the time to prepare cases for judicial review, we initiated an aggressive review of all pending cases where there was representation; those with issues fully and adequately briefed were promptly transferred for judicial review without the case summary and research memoranda that traditionally had been prepared by CLS attorneys. I am pleased to report that this has reduced the number of cases pending preparation for judicial review from a high of over 800 to under 400 by the end of calendar year 2011, and we continue to work toward a goal of forwarding cases for judicial decision no more than 30 days after the matter is fully briefed by the parties.
With fewer case summary and research memoranda, additional CLS support was shifted to our Senior Judges. CLS attorneys prepare and draft cases and orders for the Senior Judges and are able to maintain a steady flow of work so that the Senior Judges are as productive as possible throughout their 90-day recall period. At the same time, we have continued our very successful mandatory conferencing process for all cases where the appellant is represented. This focus on resource allocation has proven to be tremendously helpful in reducing the overall number of cases pending decision by a judge or panel – from 709 at the end of FY 2010 to 388 at the end of FY 2011, and reducing the number of appeals at the Court over 18 months that are pending judicial decision from 709 to 170.
We also continue to use and adapt our innovative electronic case management/electronic case filing system (CM/ECF), which allows us to receive most documents and issue most orders and decisions electronically. CM/ECF permits remote 24-hour filing access, reduced storage space needed for record retention, the opportunity for multiple users to access records, efficient electronic notification procedures, and reduced mailing/courier costs – all useful and time saving features for case processing and management. We still do have paper filing and orders for self-represented appellants, who in fiscal year 2011 accounted for 54% of the number of appeals at the time of filing, and 24% at termination.
Although our managerial adjustments have been very helpful, I cannot stress enough the extra effort that all judges and Court staff have made, and are making, to decide cases. There are limits to how long one can continue "game-day" performance on a daily basis. Without question, if the number of Board decisions denying benefits grows significantly, and our appeals do the same, the time to process an appeal will grow, and only grow faster if our judicial vacancies are not filled.
III. Examination of the Structure of Federal Appellate Review of
Veterans Benefits Decisions, and the Veterans Courthouse Project
In October 2009, and again in early 2010, I testified before our authorizing committees and this subcommittee regarding a proposal to establish a commission to evaluate the process of appellate review of veterans benefits decisions and to make recommendations on how to improve that system. Because such an independent commission may well identify beneficial changes to the current appellate structure that could result in reduced time to decide an appeal, as well as reduced time to adjudicate claims below, I again make that recommendation.
Under the unique system of judicial review we currently have, a party dissatisfied with a decision from our Court may appeal, as of right, to yet another appellate court before seeking review at the U.S. Supreme Court. The Court continues to believe that the time is right for a working group to review this system, critically examine its strengths and weaknesses, and identify measures that could benefit the overall appellate process. Specifically, we support and encourage a commission to weigh the costs and benefits of the unique, two-tiered federal appellate review system in place for veterans benefits decisions. With more that two decades of experience in appellate review of veterans benefits claims, and the resultant seasoned body of case law, it is time to consider the added value of the second layer of federal appellate review now in place.
I also want to follow up on the Veterans Courthouse Project. The United States Court of Appeals for Veterans Claims remains, to my knowledge, the only federal appellate court housed in a leased commercial office building. We were very close to receiving appropriations for the Courthouse in our FY 2010 appropriation, but circumstances combined to warrant delay. Specifically, the General Services Administration's estimated cost virtually doubled from the time of our FY 2010 budget testimony before this committee and passage of the FY 2010 appropriations bill, and at the same time the Nation's fiscal crisis was becoming better understood. We remain sensitive to budget constraints and understand that priorities must be set by Congress. However, we stand with Congress in its intent to build a "dedicated courthouse [ ] symbolically significant of the high esteem the Nation holds for its veterans [that would] express the gratitude and respect of the Nation for the sacrifices of those serving and those who have served in the Armed Forces, and their families" (H.R. 3936) or "to provide the image, security, and stature befitting a court that provides justice to the veterans of the United States" (S. 1315). And, we also stand with the many Veterans Service Organizations and veterans at large who believe if any federal courthouses are to be funded for construction, their courthouse should be one of them.
On behalf of the judges and staff of the Court, I express my appreciation for your past and continued support, and for the opportunity to provide this testimony today.
The fiscal year (FY) 2013 budget request of the United States Court of Appeals for Veterans Claims (Court) totals $32,480,700, which is made up of two separate and distinct parts: (1) $29,754,700 for the Court's necessary operating expenses, and (2) $2,726,000 sought by the Veterans Consortium Pro Bono Program. This request reflects an increase of $1,710,700 over the FY 2012 appropriation.
The Court is one of the busiest federal appellate courts based on the number of appeals filed and decided per judge. The Court currently has six active Judges, with one permanent and two temporary authorizations vacant. In response to its heavy caseload, the Court has worked to identify ways to gain efficiency while preserving for all veterans the right to a full and fair decision on their appeals. The measures we have employed toward this end include: making administrative adjustments and hiring temporary staff to assist chambers in providing prompt judicial review; adjusting the tasks assigned to our central legal staff attorneys to allow them to concentrate their efforts on our very successful pre-briefing dispute resolution program and to assisting our recalled Senior Judges; streamlining the decision process for cases where the parties both have legal representation; continuing to adapt our electronic case management/electronic case filing system; and above all else, relying on the tireless effort and focus of our active judges, our six recall-eligible Senior Judges, and each and every member of the Court's staff.
The Court continues to encourage appointment of a commission to evaluate the costs and benefits of the unique two-tiered federal appellate review system we have for veterans benefits decisions.
The Court remains the only federal appellate court housed in a leased commercial office building. The Court is mindful of budget constraints but strongly urges that if any federal courthouses are to be funded for construction, a courthouse for our Nation's veterans should be among them.