Good afternoon Madam Chairwoman, Ranking Member Boozman, and other Members of the Subcommittee.  I am pleased to be here to provide the Department of Veterans Affairs’ (VA) views on pending legislation affecting a number of our programs.  Joining me today are John Brizzi, Deputy Assistant General Counsel, and Joseph Simpson, also from the Office of the General Counsel.   

HOUSING PROPOSALS

H.R. 5360

Madam Chairwoman, your bill, the “Blinded Veterans Housing Improvement Act of 2010,” would amend section 2101(b)(2)(A) of title 38, United States Code, to expand Specially Adapted Housing (SAH) eligibility for the visually impaired.  Under current law, an individual is not eligible for what is commonly called a “2101(b) grant” unless his or her visual acuity is 5/200 or less.  By establishing a qualifying degree of blindness at visual acuity of 20/200 best-corrected visual acuity or less, or as a field of vision of 20 degrees or less, your bill would make the 2101(b) grant available to a wider range of Veterans and Servicemembers.

Provided Congress identifies appropriate and acceptable offsetting PAYGO cost savings, VA supports this legislation.  Current eligibility requirements for 2101(b) grants based on visual impairment are exceptionally stringent in comparison to other areas of law.  Many grant applicants who are considered legally blind by other commonly-held standards are ineligible for 2101(b) grants because their visual impairments, though profound, are not severe enough to meet the standard set under current law.  For example, under the Social Security Administration’s eligibility standards for supplemental security income (SSI), individuals are considered legally blind with visual acuity of 20/200 or less, or a peripheral field of vision of 20 degrees or less.  Additionally, VA’s Servicemembers' Group Life Insurance Traumatic Injury Protection Program’s eligibility standard related to visual acuity is ‘20/200 or less’.  However, since the standard for “blindness” for the 2101(b) grant is “5/200 visual acuity or less,” a Veteran or Servicemember who is legally blind for purposes of SSI or VA life insurance would not be eligible for a 2101(b) grant.

We estimate that enactment of H.R. 5360 would result in benefits costs of $4.0 million during the first year, $14.2 million for 5 years, and $19.1 million over 10 years.

H.R. 4319

H.R. 4319, the “Specially Adapted Housing Assistance Enhancement Act of 2009,” would adjust through fiscal year 2011 the aggregate amount of SAH assistance available to individuals residing temporarily with family members.  It also would add a new section to chapter 21 of title 38, United States Code, to define the term “loss of use.”  Although VA supports the adjustment to the Temporary Residential Adaptation (TRA) grant, VA cannot support the bill as drafted.

The TRA grant, authorized in 38 U.S.C. 2102A, is available to eligible individuals who reside temporarily with family members, and is counted both as a grant use and as a reduction in the total amount of SAH assistance available.  Currently, an eligible individual may receive up to three grants of assistance under the chapter, not to exceed the applicable maximum aggregate amount of assistance.  Section 2 of the bill would authorize the Secretary to disregard a TRA grant when calculating the maximum dollar amount available under chapter 21.  Thus far, there has been limited usage of TRA grants.  Section 2 of the bill may increase usage of this program because an individual could obtain the short-term adaptations he or she needs immediately, with less worry about whether funds would later be available for permanent living arrangements. 

Section 3 of the bill would add a new section 2100 to chapter 21 of title 38, United States Code, to define the term “loss of use”.  For purposes of the chapter, “loss of use” would mean, “any loss of use for which the individual is entitled to receive compensation under chapter 11 of [title 38].”  Currently under 38 U.S.C. § 2101, an individual may only receive SAH assistance if his or her injuries are permanent and total and service-connected and if they meet the specific criteria identified.  Because the provision in section 3 would not change those requirements, it is not clear how VA would apply the new definition of “loss of use,” or whom it would benefit.

The following illustration might help clarify the point:  Chapter 21 authorizes two types of grants—one currently offering $63,780 in assistance and the other $12,756.  When a Veteran receives a permanent and total service-connected disability rating due to the loss of use of both upper extremities, 38 U.S.C. §2101(a)(2)(D) further requires the Secretary to determine whether the loss of use is at or above the elbows.  If the Secretary so determines, the Veteran is medically eligible for the larger grant; if not, the Veteran is eligible only for the smaller grant.  The definition proposed in section 3 of the bill would make no difference in the type of assistance a Veteran would receive under chapter 21 because it would not change the general requirements that injuries be total and permanent and service-connected, and it would not change the criteria of qualifying injuries already specified in the statute. 

Without a clear understanding of the intent of section 3 of the bill, VA is unable to estimate the cost of enacting the proposal.  Upon clarification, VA will provide a cost estimate for the record.

In view of our uncertainty about the impact of the amendment proposed in section 3 and about any PAYGO costs that the bill would impose, we are unable to support the bill as drafted.  We would be pleased to work with the Subcommittee staff in resolving this concern.

H.R. 4635

H.R. 4635, the “Foreclosure Mandatory Mediation Act of 2010,” would require qualified mortgagees, including lenders who hold federally-guaranteed or federally- insured loans, to consent to mandatory mediation before proceeding with a foreclosure.  The qualified mortgagee would be required to “conduct, consistent with any applicable State or local requirements, a one-time mediation with the affected mortgagor and a housing counseling agency, at the expense of the qualified mortgagee.”  

The bill does not explain what it means for a mortgagee to “conduct” a mediation with a mortgagor and a housing counseling agency.  Mediation is generally conducted by an impartial third-party who assists each of the mediating parties, without favoring the interests of one over another.  This means that participants and their advocates, including certain housing counselors, might not be best suited for facilitating the mediation proceedings. 

The bill text is also unclear as to what expenses a qualified mortgagee must pay in connection with the mediation.  For instance, expenses are not expressly limited to the charges of a non-profit mediator for a half-day’s services.  It could be argued that, as drafted, the bill would require a qualified mortgagee to pay for the services of a for-profit mediator, along with accommodations and meals for the affected mortgagor and housing counseling agency representative.   

Furthermore, we do not fully understand the intent of the requirement that the mediation be conducted “consistent with any applicable State or local housing requirements.”  Such State or local requirements are typically part of the State foreclosure law or, in some cases, local judicial procedural requirements.  VA is uncertain whether the absence of a State or local requirement would mean that mediation is not necessary, or whether it implies a Federal requirement would still compel mediation.

Finally, it is unclear whether the requirement to mediate is based on the status of the qualified mortgagee or if it is based on the type of loan the lender intends to foreclose.  One possible understanding is that, if a mortgagee holds one federally-guaranteed loan in its portfolio, it would be required to mediate before foreclosing any loan, regardless of whether the loan to be foreclosed is federally guaranteed.  Another interpretation is that the bill would only require mediation when a loan is of the type expressly categorized.  In other words, a qualified mortgagee would be required to mediate before foreclosing a VA-guaranteed loan but not a conventional loan.

Accordingly, we are unable to support this bill as drafted.

Without a clear understanding of the intent of the bill, we are unable to estimate the cost of enacting the proposal.  Upon clarification, we will provide a cost estimate for the record.

H.R. 4664

H.R. 4664 would amend the Servicemembers Civil Relief Act to provide for a one-year moratorium on the sale or foreclosure of property owned by surviving spouses of Servicemembers killed in Operation Iraqi Freedom or Operation Enduring Freedom.  VA respectfully defers to the Department of Defense regarding the merits of this proposal.

VA is unable to estimate the cost of the proposal, as it will depend upon interpretation of the eligibility criteria by the Department of Defense.

EDUCATION PROPOSALS

H.R. 114

H.R. 114, the “Veterans Entrepreneurial Transition Business Benefit Act,” would authorize a Veteran who is eligible to receive financial educational assistance under the chapter 30 Montgomery GI Bill to elect to use that benefit, with the approval of VA, to establish, own, and operate a business as his or her primary source of income.  The measure also would require VA to promulgate regulations to (1) make sure such financial educational assistance would be used for the purpose for which it was approved; (2) establish application procedures requiring appropriate business planning; and (3) require periodic reporting during the provision of such assistance.

While VA strongly supports assisting in, and advocating for, Veterans’ opportunities in the areas of small business and self-employment, VA cannot support the bill as drafted.  VA believes GI Bill education benefits should be preserved and the program administered as currently established.  It is difficult to understand how the “entrepreneurial transition business benefit” is logically related to educational assistance, and how eligibility for a specific educational program would be an appropriate indicator of entrepreneurship.  The Small Business Administration (SBA) may be better suited to develop the business plans and provide the self-employment support contemplated by H.R. 114.  VA also notes the bill provides no guidance as to how VA would determine the particular amount of educational assistance an individual could receive or how VA would otherwise implement its provisions.  We would be pleased to work with the Subcommittee staff and SBA to identify a suitable alternative to provide educational assistance for Veterans who seek self-employment opportunity. 

Although we believe the fiscal impact of this legislation on VA would likely be minimal, we lack the data necessary to a determination of the expected caseload.  Because of this, we are unable to provide an estimate of the cost of enactment of this provision.

H.R. 4765

H.R. 4765 would amend 38 U.S.C. § 3485(a)(4) to authorize individuals who are pursuing programs of rehabilitation, education, or training under chapters 30, 31, 32, 33, or 34 of title 38, United States Code, or chapters 1606 or 1607 of title 10, United States Code, to receive work-study allowances for certain activities conducted at the offices of Members of Congress.  These work-study participants would distribute information concerning VA benefits and services, as well as other appropriate governmental and non-governmental programs, to members of the Armed Forces, Veterans, and their dependents.  In addition, the work-study participants would prepare and process papers and other documents, including documents to assist in the preparation and presentation of claims for VA benefits.

VA has no objection to the enactment of H.R. 4765, subject to the identification of appropriate and acceptable PAYGO offsets for any resulting additional costs.  We have no objection to work-study participants participating in, and promoting, the outreach activities and services contemplated by the bill.  We also have no objection to work study participants assisting in the preparation and processing of papers and other documents, ”including documents to assist in the preparation and presentation of claims for VA benefits” (emphasis added) under proposed new section 3485(a)(4)(G)(ii).  We note that work-study participants would be subject to the 38 U.S.C. chapter 59 limitations on representing claimants for VA benefits. 

VA estimates that the enactment of H.R. 4765 would result in a benefits cost of at least $727,000 during the first year, $3.6 million over a 5-year period, and $7.3 million over 10 years.  

OTHER PROPOSALS

H.R.3685

H.R. 3685 would require VA’s main page of its Internet website to include a hyperlink with a drop-down menu, with direct access to the VetSuccess Internet website, the USA Jobs Internet website, the Job Central website, and other employment websites that focus on jobs for Veterans.  It would also require the Secretary to promote awareness of the VetSuccess Internet website by advertising in national media and to inform Veterans of Operation Iraqi Freedom and Operation Enduring Freedom of the VetSuccess Internet website through outreach efforts.

VA supports efforts to increase Veterans’ awareness of the VetSuccess.gov website and to promote opportunities for employment of Veterans through links to appropriate resources.  Although we believe we are currently accomplishing the purpose of this legislation, we do not object to its enactment.  VA’s Vocational Rehabilitation and Employment (VR&E) program currently conducts outreach to OEF/OIF Veterans through their Coming Home To Work (CHTW) initiative and through other avenues such as Disabled Transition Assistance Program (DTAP) presentations.  VR&E informs Veterans of the VetSuccess.gov website through CHTW and by other means, including DTAP presentations and the distribution of QuickBooks.

One-time costs associated with advertising in national media outlets are estimated to be $900,000 during the first year.  To conduct a recent media campaign, VA’s Education Service spent approximately $380,000 on developing concepts and materials, identifying and targeting appropriate markets, and developing a marketing plan.  An additional $520,000 was spent on implementation of the marketing plan.   Implementation included advertising on radio, social media sites including Facebook and MySpace, Internet sites including Google and Yahoo, print outlets and text messaging services.  VA would expect to incur similar costs to conduct a media campaign to advertise the VetSuccess.gov website.

No additional costs are related to conducting outreach to OEF/OIF Veterans to inform them of the VetSuccess.gov website because this is currently done by VR&E.  No additional costs are associated with including hyperlinks on the VA main Internet page because VA has already budgeted for these types of minor changes.

H.R. [Draft bill, unnumbered] — The Veteran-Friendly Business Act of 2010

The “Veteran-Friendly Business Act of 2010,” would require the Secretary to establish an award program, as well as a process for administering such program, that would recognize businesses for their contributions to Veterans’ employment.  The program must specify categories and sectors of businesses eligible for recognition each year and objective measures for selecting recipients of the award.

VA supports this bill.  A program of recognition for contributions to Veterans’ employment is a worthwhile means of encouraging businesses to continue to employ Veterans.  Businesses that contribute to Veterans’ employment provide a valuable and meaningful service, allowing VA to excel with regard to its mission to help Veterans become employable and obtain and maintain suitable employment.  This service deserves appropriate recognition.  VA would recommend two categories, “small businesses” and “other than small businesses,” and three sectors, “non-profit,” “service,” and “manufacturing, farming and other,” of recipients eligible to receive awards.  A review board would be created to review nominations and select recipients.  Recipients would receive trophies and runners-up would receive plaques.

We estimate that enactment of this bill as contemplated would result in no significant costs.  We estimate nominal costs associated with staff-days to review and select nominations, advertising, verification of winners, and purchasing trophies and plaques.

H.R. 3266

H.R. 3266 would require VA and the Department of Defense (DoD) to jointly establish the “Wounded Warrior K-9 Corps” program, to award competitive grants to nonprofit organizations to assist such organizations in planning, designing, establishing, and operating programs to provide assistance dogs to covered members of the Armed Forces and Veterans, subject to the availability of appropriations provided for the program.  Grant recipients would use the funding to carry out programs that provide assistance dogs to covered members and Veterans with certain disabilities, including blindness or visual impairment; loss of the use of a limb, paralysis, or other significant mobility issue; loss of hearing; traumatic brain injury; post-traumatic stress disorder; and any other disability that VA and DoD consider appropriate.  Assistance dogs would be defined as dogs that are specifically trained to perform physical tasks to mitigate the effects of these disabilities, and would not include dogs specifically trained for comfort or personal defense. 

To be eligible for a grant, a nonprofit organization would be required to submit an application to VA and DoD in such manner, and containing such information, as VA and DoD may require.  The application would include a proposal to evaluate the effectiveness of the activities carried out by the grant recipient (an evaluation would be required of each grant recipient), and a description of (1) the organization’s training program, including training and aftercare services for the covered members and Veterans, as well as the dogs; (2) the plan for publicizing the availability of the dogs through a targeted-marking campaign to covered members and Veterans; (3) the recognized expertise of the organization in breeding and training such dogs, and the expertise of the organization with working with military medical treatment facilities, or VA medical facilities; and (4) the organization’s commitment to standards comparable to the standards of the International Guide Dog Federation or Assistance Dogs International, and the organization’s commitment to humane standards for animals.  “Covered” members would include a member of the Armed Forces who (1) is receiving medical treatment, recuperation, or therapy under chapter 55 of title 10, United States Code; (2) is in a medical hold or medical holdover status; or (3) is covered under section 1202 or 1205 of title 10, United States Code.  “Covered” Veterans would include Veterans who are enrolled in VA’s system of patient enrollment, established under section 1705(a) of title 38, United States Code.  The bill would authorize the appropriation of $5 million for each of fiscal years 2010 through 2014.  

We are in the early stages of developing our own assistance dog program, so the full impact of the demand for service dogs may not have been realized so far.  A recent report by the Office of Inspector General found that of 4 assistance dog agencies surveyed (out of 77 Assistance Dog International member organizations), 124 dogs had been placed with Veterans.  VA has no direct knowledge of any shortage in available dogs.  Therefore, we recommend deferring action on this bill to allow the current program sufficient time to become fully operational and better ascertain future needs for this benefit.

In addition to the appropriation of $5 million each fiscal year through 2014, VA estimates enactment of this proposal would result in additional administrative costs of $759,000 in the first year, $4.3 million over 5 years, and $8.2 million over 10 years. 

Madam Chairwoman, this concludes my statement.  I would be happy to respond to questions you or the other Members of the Subcommittee may have regarding our views, as presented.