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Legislative Hearing on H.R. 1750, H.R. 1824, H.R. 1598, H.R. 1315, H.R. 1240, et al

Legislative Hearing on H.R. 1750, H.R. 1824, H.R. 1598, H.R. 1315, H.R. 1240, H.R. 675, H.R. 513, H.R. 2259, H.R. 2475, H.R. 1632, H.R. 112, H.R. 2579, and H.R. 1370.

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LEGISLATIVE HEARING ON H.R. 1750, H.R. 1824, H.R. 1598, H.R. 1315, H.R. 1240, H.R. 675, H.R. 513, H.R. 2259, H.R. 2475, H.R. 1632, H.R. 112, H.R. 2579, AND H.R. 1370










JUNE 21, 2007

SERIAL No. 110-30

Printed for the use of the Committee on Veterans' Affairs





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BOB FILNER, California, Chairman


VIC SNYDER, Arkansas
JOHN J. HALL, New York
PHIL HARE, Illinois
MICHAEL F. DOYLE, Pennsylvania
TIMOTHY J. WALZ, Minnesota

STEVE BUYER,  Indiana, Ranking
HENRY E. BROWN, JR., South Carolina
BRIAN P. BILBRAY, California




Malcom A. Shorter, Staff Director


JOHN J. HALL, New York
JOHN BOOZMAN, Arkansas, Ranking

Pursuant to clause 2(e)(4) of Rule XI of the Rules of the House, public hearing records of the Committee on Veterans' Affairs are also published in electronic form. The printed hearing record remains the official version. Because electronic submissions are used to prepare both printed and electronic versions of the hearing record, the process of converting between various electronic formats may introduce unintentional errors or omissions. Such occurrences are inherent in the current publication process and should diminish as the process is further refined.



June 21, 2007

Legislative Hearing on H.R. 1750, H.R. 1824, H.R. 1598, H.R. 1315, H.R. 1240, H.R. 675, H.R. 513, H.R. 2259, H.R. 2475, H.R. 1632, H.R. 112, H.R. 2579, and H.R. 1370


Chairwoman Stephanie Herseth Sandlin
    Prepared statement of Chairwoman Herseth Sandlin
Hon. John Boozman, Ranking Republican Member, prepared statement of
Hon. Ginny Brown-Waite
Hon. Timothy J. Walz
    Prepared statement of Congressman Walz


U.S. Department of Veterans Affairs, Keith Pedigo, Director, Loan Guaranty Service, Veterans Benefits Administration
    Prepared statement of Mr. Pedigo

American Legion, Ronald F. Chamrin, Assistant Director, Economic Commission
    Prepared statement of Mr. Chamrin
American Trucking Associations, Inc., Ray Kuntz, Chairman, and Chief Executive Officer, Watkins and Shepard Trucking Company, Helena, MT
    Prepared statement of Mr. Kuntz
Brady, Hon. Robert A., a Representative in Congress from the State of Pennsylvania
    Prepared statement of Congressman Brady
Disabled American Veterans, Brian E. Lawrence, Assistant National Legislative Director
    Prepared statement of Mr. Lawrence
Israel, Hon. Steve, a Representative in Congress from the State of New York
    Prepared statement of Congressman Israel
Jackson-Lee, Hon. Shelia, a Representative in Congress from the State of Texas
    Prepared statement of Congresswoman Jackson-Lee
Michaud, Hon. Michael H., a Representative in Congress from the State of Maine
    Prepared statement of Congressman Michaud
Reichert, Hon. David G., a Representative in Congress from the State of Washington
    Prepared statement of Congressman Reichert
United States Olympic Committee, Charlie Huebner, Chief of U.S. Paralympics
    Prepared statement of Mr. Huebner
Welch, Hon. Peter, a Representative in Congress from the State of Vermont
    Prepared statement of Congressman Welch
Wynn, Hon. Albert Russell, a Representative in Congress from the State of Maryland
    Prepared statement of Congressman Wynn


U.S. Department of Defense, Leslye A. Arsht, Deputy Under Secretary of Defense (Military Community and Family Policy), statement
U.S. Department of Labor, Hon. Charles S. Ciccolella, Assistant Secretary, Veterans' Employment and Training Service, statement

Blinded Veterans Association, Thomas Zampieri, Ph.D., Director of Government Relations, statement
Davis, Hon. Jo Ann, a Representative in Congress from the State of Virginia, statement
National Association of Mortgage Brokers, Harry H. Dinham, President, statement
Vermont State Office of the Adjutant General, Michael D. Dubie, Major General, The Adjutant General, letter


Newspaper Article and Report:

"Bills in the Napsack: A Law Gets Lost; Creditors Press Troops Despite Relief Act," The New York Times, Late Edition - Final, March 28, 2005, Section A; Column 3, By Diana B. Henriques

U.S. Government Accountability Office, Testimony of Cynthia A. Bascetta, Director, Health Care—Veterans' Health and Benefits Issues, Before the Committee on Veterans' Affairs, entitled:  "VA Health Care, More Outpatient Rehabilitation Services for Blind Veterans Could Better Meet Their Needs," GAO-04-996T, July 22, 2004

Post-Hearing Request and Follow-up Administration Views on Legislation:

Hon. Stephanie Herseth Sandlin, Chairwoman, Subcommittee on Economic Opportunity, Committee on Veterans' Affairs, to Leslye A. Arsht, Deputy Under Secretary of Defense (Military Community and Family Policy), U.S. Department of Defense, letter dated October 23, 2007, requesting Administration views on H.R. 513, H. 1598, and H.R. 1750

Hon. Gordon H. Mansfield, Acting Secretary, U.S. Department of Veterans Affairs, to Hon. Bob Filner, Chairman, Committee on Veterans' Affairs, letter dated October 26, 2007, transmitting Administration's views and estimates for H.R. 704, H.R. 2259, and H.R. 1824

Hon. James B. Peake, M.D., Secretary, U.S. Department of Veterans Affairs, to Hon. Bob Filner, Chairman, Committee on Veterans' Affairs, letter dated March 31, 2007, transmitting Administration's views and estimates for H.R. 1370

LEGISLATIVE HEARING ON H.R. 1750, H.R. 1824, H.R. 1598, H.R. 1315, H.R. 1240, H.R. 675, H.R. 513, H.R. 2259, H.R. 2475, H.R. 1632, H.R. 112, H.R. 2579, AND H.R. 1370

Thursday, June 21, 2007
U. S. House of Representatives,
Subcommittee on Economic Opportunity,
Committee on Veterans' Affairs,
Washington, DC.

The Committee met, pursuant to notice, at 2:00 p.m., in Room 334, Cannon House Office Building, Hon. Stephanie Herseth Sandlin [Chairwoman of the Subcommittee] presiding.

Present:  Representatives Herseth Sandlin, Boozman, and Moran.
Also Present: Representatives Brown-Waite, Walz.


Ms. HERSETH SANDLIN. Good afternoon, ladies and gentlemen.  The Committee on Veterans’ Affairs, Subcommittee on Economic Opportunity, Hearing on Pending Legislation will come to order.

For purposes of trying to get through with, and hearing from our first panel of witnesses before votes may be called, I know Mr. Wynn is on his way as is our Ranking Member, Mr. Boozman, but I would like to get started.

Before I begin with my opening statement, I want to call attention to the fact that Representative Tim Walz, Representative Jo Ann Davis, and Ms. Leslye Arsht, Deputy Under Secretary of Defense for Military Community and Family Policy for the Department of Defense have asked to submit written statements for the record.  If there is no objection, I ask unanimous consent that their statements be entered for the record.  Hearing no objection, so entered.

[The opening statement of Congressman Tim Walz and the written statements Congresswoman Jo Ann Davis, and Ms. Leslye Arsht appears in the Appendix.]

Ms. HERSETH SANDLIN. As some of you may recall, this Subcommittee has held numerous hearings in the prior Congress as well as this one regarding adaptive housing, education assistance, and ensuring that our returning servicemembers and their families have a smooth and effective transition to civilian life.

With an increasing number of disabled veterans returning home from Iraq and Afghanistan, there is an urgent need to review these important pieces of legislation.  Today we have 13 bills before us that seek to do a number of things.  They seek to protect our Nation’s veterans from financial burdens incurred while serving one’s country; expand education programs while meeting the current needs of our economy; provide transition assistance to members of the National Guard and Reserve; strengthen re-employment rights for returning veterans; ensure the vitality of programs that assistant veterans in making the best use of Montgomery G.I. Bill Education Benefits; and establish an office to promote programs to assist our injured veterans to heal from the wounds they have sustained while in the U.S. Armed Forces.

In addition, I have introduced legislation that will be discussed here today that seeks to address some of the special housing needs of our returning brave men and women in uniform.  The first bill is H.R. 1315,which would provide specially adaptive housing assistance to disabled servicemembers residing temporarily in housing owned by a family member.  Under current law a temporary grant may be available to veterans who are or will be temporarily residing in a home by a family member, but the assistance provided by this bill allowable up to $14,000 may be used to adapt the family member’s home to meet the veteran’s special needs at that time.

The second bill, H.R. 675 would increase the amount of assistant available to disabled veterans for specially adaptive housing grants from the current $50,000 to $60,000.  I believe these two bills will be critical components in assisting our disabled veterans and servicemembers and expand the resources available to give them a level of independent living they may not otherwise attain.

I look forward to working with the Ranking Member, as well as all members of the Subcommittee to continue to improve the quality of care and services available to our veterans.

As soon as Mr. Boozman arrives, I will want to acknowledge him for an opening statement.  So if Mr. Moran would indulge us to move directly to the first panel.

[The statement of Chairwoman Herseth Sandlin appears in the Appendix.]

Mr. MORAN. Madam Chairman, to expedite matters I am happy to forgo an opening statement.  I look forward to hearing the comments from our colleagues.

Ms. HERSETH SANDLIN. Very good.  Joining us on our first panel is the Honorable Albert Wynn; the Honorable Steve Israel; the Honorable Sheila Jackson-Lee; and the Honorable Robert Brady.

All of your written statements will be entered into the record.  Mr. Wynn, if you are ready you may start, otherwise I will have Mr. Brady go.  You are more than welcome to start out and you are recognized for five minutes.



Mr. WYNN. Thank you very much, Madam Chairwoman.  I am also in a markup so with your indulgence I would appreciate it.

Mr. MORAN. Go ahead.


Mr. WYNN. Chairwoman Herseth Sandlin, Ranking Member Boozman, and members of the Subcommittee, thank you for the opportunity to testify today on H.R. 1750 the bill I have offered to extend the protections offered under the Servicemembers Civil Relief Act.

H.R. 1750 would extend the protections to a mortgage property owned by a servicemember or a qualified Reserve or Guard member to one year from the current law which provides for a 90—protection for 90 days.

The bill attempts to address the very real economic and life hardships that active-duty servicemembers and women and their families frequently face and acts to protect the families most treasured and needed possession, their home.  The bill is consistent with the requirements and limitations of the Servicemembers Civil Relief Act, originally passed in 1940 and amended in the 108th Congress.  The Servicemembers Civil Relief Act is an important safeguard for our Nation’s veterans and active-duty servicemembers.

The bill would extend the protections granted to active-duty servicemen and their immediate families by increasing the period in which they are protected against mortgage foreclosure.  It gives servicemembers, Guard, and Reserve members returning from active duty time to re-adjust to civilian life while protecting their most valued asset and rebuilding a normal life with their family.

Many combat injuries occurred as a result of active duty both physical and mental can seriously obstruct servicemen and servicewomen from finding and holding down a job.  Upon their return due to the operational tempo and intense levels of combat that our troops face in this conflict, more and more returning servicemembers are evidencing signs of serious combat stress and related mental health conditions.  Repeated and lengthened employments dramatically affecting the troops–dramatically affect the troops and their families.

A recent study found that those who have served multiple tours are 50 percent more likely to suffer from acute combat stress.  The Defense Department Task Force on Mental Health reported in early June that almost 40 percent of the troops have experienced some type of psychological problem.  When they come home ,these veterans are unable to fully mesh back into normal life.  They may lose their job, their home, they may end up on the street, unfortunately.

I received considerable anecdotal evidence of the family distribution that occurs and that is why we believe this bill is very important.  There are also economic challenges that the returning members face.  And the bottom line is that this bill would allow basically a year to reconnect with your family, re-establish your financial situation, and proceed on with your life while protecting you from the loss of your home due to mortgage foreclosure.

Now this is not a absolute protection.  As exist under current law, it is only a protection that says that you are entitled to a court hearing which would allow you to present evidence that your non-payment of your mortgage is materially affected by conditions relating to your active-duty service.

I think this protection is a practical approach to solving the problem.  It also really gives life to the rhetoric that we often espouse of our honoring our veterans by assuring them a reasonable period of time to readjust and protect their home from mortgage foreclosure.

I really thank you for this opportunity and be happy to respond to any questions you might have.

[The statement of Congressman Wynn appears in the Appendix.]

Ms. HERSETH SANDLIN. Mr. Wynn, thank you very much.  Mr. Brady, we look forward to your testimony.  Thank you for being such an early and consistent leader on the issue of credit protection for our servicemembers.  You are now recognized for five minutes.


Mr. BRADY. Thank you, Madam Chairwoman.  I would like to thank you, thank the Committee also for having me testify here.  I would like to discuss H.R. 513, the "National Hero’s Credit Protection Act."

No military personnel should ever suffer financial hardship for answering the call.  This bill will require that credit reporting agencies add a simple note to the credit files of deployed active-duty servicemembers and activated Reservist and National Guard personnel indicating that late and slow payments to existing accounts occurred during the deployment or mobilization.

This bill will make it easier for our troops to protect their credit by requiring them to report their deployment to just one agency instead of to every creditor.  But it will not allow anyone to run up new debt or to get out of any debt they already owe.  It will not cost the Federal Government anything to implement.  There will be no new forms or actions for the Defense Department to use.  Troops will be advised of their rights under the servicemembers readiness process that they already go through and it will not impact creditors because their debt will still be paid.

I believe that this a simple cost-effective way to protect our troops during this, the longest deployment in America history. 

Real quickly, Madam Chairwoman, I was approached by a sheriff in the city of Philadelphia that was deployed in the first deployment to Iraq.  And it was a woman.  She was there for 18 months.  And she asked me to intervene and help her to straighten out her credit that was ruined by her 18 months that she was over in Iraq.

She said to me she saw many armored tanks, many armored vehicles, military planes, a lot of military equipment, but she didn’t see a mail truck.  And because of that she could not get her bill for 18 months.  She was a single woman and lived at home and mail wasn’t being forwarded to her over in Iraq.

When she came back she asked me if I would intervene to try to help her get her credit straightened out, and after being hung up about four or five times with major credit agencies, I was able to get a little bit of help for her, but not the necessary help that now she has credit problems,  that her interest is a little high.  I am still trying to help her as we speak, six, seven—five, six years from now.  I think this bill would help our men and women that are out there protecting myself, yourself, and all of us every single day.  And it is wrong to have their credit ruined while they are protecting the United States of America.

Thank you.

[The statement of Congressman Brady appears in the Appendix.]

Ms. HERSETH SANDLIN. Thank you, Mr. Brady.  We will look forward to posing a few questions for you.

Mr. BRADY. Sure.

Ms. HERSETH SANDLIN. Mr. Israel, you are now recognized for five minutes.  Thank you, for your efforts in this same area.


Mr. ISRAEL. Thank you very much, Madam Chairwoman and thank you to Mr. Moran and the entire Committee.  I am grateful for the opportunity to testify in support of H.R. 1598, which is a bipartisan bill introduced by Mr. Jeff Davis, a gentleman from Kentucky who serves on the Armed Services Committee and myself. 

I want to thank Mr. Brady for starting the debate and being the first to respond to the critical issue of servicemembers who are taking bullets and being harassed in the military theater and then have to come back and fight a bureaucracy to try and restore their credit at home.

My legislation is essentially a compliment or supplement to Mr. Brady’s and we have had a dialogue on how we can continue to work together.  My legislation closes the gap between the protections that the Servicemembers Civil Relief Act provides to people in military theater and the awareness that most servicemembers and many creditors don’t have with respect to those protections.

For example, I have a constituent named Carl Botkin who left Long Island to serve as a Naval Reserve Officer in Kuwait from July 2005 to April 2006.  Almost as soon as he left, his phone began ringing off the hook at home where his wife was constantly harassed by creditors.  She called her auto company because somebody had told her that they weren’t allowed to charge her the interest rate that they were charging her and asked whether there was any relief that she could get.  And was told over the phone that there is no such law in place that offers that relief and, “If you don’t pay we will come and get your car.”

She called her credit card company because her credit card debt was growing.  And the company continued to charge her with fees and interest and all sorts of penalties in contradiction to the Servicemembers Civil Relief Act.  When they called our office, we were able to get many of those fees and penalties waived, but the fact of the matter is that this poor women went through extraordinary distress.  And she is not alone.

The New York Times, on March 28, 2005, published a front page story reporting that companies and servicemembers are often unaware of those protections.  With a headline, “Creditors Press Troops Despite Relief Act,” and I would submit that for the record, Madam Chairwomen.

[The New York Times article appears after Mr. Israel's statement.]

Ms. HERSETH SANDLIN. So entered.

Mr. ISRAEL. The article talked about Sergeant John Savage who got a call from his wife on his way to Iraq and was told, “They are foreclosing on our house.”  At Fort Hood, Texas, a soldier’s wife was sued by a creditor trying to collect a debt owed by her husband who was in Baghdad even though default judgments are not permitted against deployed soldiers.  Camp Pendleton, California, “A dozen Marines return home from Iraq to find that their cars and possessions were improperly sold while they were in Iraq to cover unpaid storage and towing fees.”  And in Ordan, Ohio, a young Army couple was served with foreclosure papers.

The problem is that ignorance has been used as an excuse for the law on the Servicemembers Civil Relief Act.  Many times deployed personnel are kissing their families goodbye, they are packing up their stuff, they are responding to their orders.  They don’t have the time to alert their creditors and tell them that they are leaving.

Many of these creditors have said publicly, “We didn’t even know this law existed.  Of course we wouldn’t have harassed and intimidated the families of our servicemembers if we knew this law was the law.  We didn’t know.”  And so what my law does basically is this:  It was designed in consultation with folks who are active in the consumer credit industry.  They consulted with us in designing this bill so that is logistically feasible.

It requires the Department of Defense when adjusting a servicemembers paycheck to receive combat pay, hostile duty pay, to automatically alert the three major credit bureaus that this person is now in a combat environment.  That adjustment has to be made anyway on the payroll system.  So it now automatically alerts the credit bureaus rather than making it the onus of the deployed personnel to alert the credit bureaus.

The credit bureaus receive that information, they flag that servicemember’s file.  When somebody tries to call that—contact that credit bureau and report adverse information, that company would be told immediately this person is under the protection of the Servicemembers Civil Relief Act.  It doesn’t entitle them to not pay their debts, to not pay their loans.  It affirmatively indicates to a creditor who may be trying to repossess a car that you can’t repossess the car; who may be trying to score against that creditor—that borrower that you can’t do it.

It affirmatively says that this person is under the legal protection of Federal law and you have certain obligations and you have certain restrictions.  So that nobody could say, “Gee, we didn’t know there was such a law.”  And so that the person who is being deployed doesn’t have to be the one to, as they are saying goodbye to their families, and packing up their belongings, and reading their orders, write to every single creditor, terminate their leases, have the obligation of informing their creditors what the law is.

It gets them off the hook.  Not to pay their debts, they still have to do those things, but it puts the onus on the Department of Defense in order to make that alert in the credit bureaus and provides those additional protections.

I thank the Chairwoman of the Subcommittee and very much appreciate your consideration of this bill.

[The statement of Congressman Israel appears in the Appendix.]

Ms. HERSETH SANDLIN. Thank you, Mr. Israel.  We have been joined by the Ranking Member Mr. Boozman.  He has indicated he will temporarily waive his opening statement and questions until after we have heard from our final witness. 

Ms. Jackson Lee, thank you for being here, you are recognized for five minutes.


Ms. JACKSON-LEE. Madam Chairwoman, let me thank you very much.  To the Ranking Member, let me thank him for his courtesies.  And thank the full Committee and the Subcommittee for the forward thinking leadership of this very important commitment to our veterans in this new Congress, in the 110th Congress.

I want to particularly applaud the work of the Subcommittee on Economic Opportunity, because it is charged with legislative oversight and investigative jurisdiction over education of veterans, employment, training of veterans, vocational rehabilitation, veterans housing programs, and readjustment of servicemembers to civilian life.

I believe there could be no more important aspect than the training and rehabilitation of our veterans.  It is the ultimate commitment that after they have been willing to give the ultimate sacrifice, and many of them have come back with any number of injuries no matter what wars they participated in, that we say to them, “You count and you care.”  And I want, again, to applaud this particular Committee and Subcommittee for that kind of attitude.

My legislation, the Vision Impairment Specialist Training Act or VISTA Act of 2007, H.R. 1240, is to make good on that commitment of training, vocational rehabilitation, and the real answer to a question, “Do I still care?”

I am very proud that this legislation is supported by the Chairman of the Veterans’ Affairs Committee.  He is one of the original co-sponsors, as well as Mr. Michaud, who is the Chair of this Committee’s Subcommittee on Health; and the co-Chairs of the Congressional Vision Caucus, my colleague Gene Green of Texas, Ms. Ros-Lehtinen of Florida.  It is a bipartisan legislative initiative.  And we are very happy to note that a companion bill has been filed today by Senator Hagel and Senator Obama.  And so it will be submitted to the Veterans’ Affairs Committee there.

We know that, and if I might just lay the ground work for the—for what we are literally facing as it relates to visually impaired veterans.  There are 160,000 legally blind veterans in the United States, but only 35,000 are currently enrolled in Veterans Health Administration (VHA) Services.  In addition, it is estimated that there are one million low vision veterans in the United States.  And incidences of blindness among the total veteran population of 26 million are expected to increase by about 40 percent over the next few years.

I need not frame for you that we know that there are 25,000 injured soldiers coming back from Iraq and Afghanistan and the numbers are mounting.  Because the injuries are focused on IEDs, brain injuries or head injuries rather, we know that much of that is impacted, if you will, or does impact sight.

And so my legislation says that we are concerned.  And I might add that Tom Zampieri is in the room, the Blind Veterans Association is a strong supporter of this legislation.  But what does my the legislation do?  And I think it goes to the heart of the matter.  How do we help them?  We need more trained individuals who know how to work with the visually impaired.  We want them back on their feet.  And my legislation does just that.  It helps to remedy the situation by directing the Secretary of Veterans Affairs to establish a scholarship program for students seeking a degree or certificate in blind rehabilitation, vision impairment, and or orientation and mobility.

The availability of these scholarships will provide an incentive to students considering entry into the field.  Additionally, in exchange for the scholarship award, students are required to work for three years in a health care facility of the Department of Veterans Affairs (VA) to assure that our veterans are well cared for.  Such a facility is in Houston; such facilities are in many of our Congressional districts; more really should be provided for.

And so this legislation clearly says to the veteran, “If you are visually impaired, you still have a future.  You still have the ability to work.  You still need to have mobility.  And we are going to help you.”  In detail, this legislation will provide financial assistance to students enrolled in a program to study or study leading to a degree or certificate in visual impairment.  It also again requires these individuals to be at the sites or to go back and give back to those who are in need.

I do want to add a point about scholarships, because everyone says scholarships how does it work?  The scholarship is from the Federal Government.  And this debt will be owed to the United States thus a discharge and bankruptcy does not discharge a person from a debt under this legislation.  If the discharge order is entered in less than five years after the date of termination of the agreement or the contract.

Let me just simply say that I have seen these veterans.  Many of us have been to Walter Reed; many of us have been to our veteran’s hospital.  And we see the kind of catastrophic injuries and we are grateful for the science of today that allows these young people to live.  And I think the value of this legislation by creating more of these medical professionals, is that more and more of these injuries are in younger and younger Americans.  Young people who have gone to war, 18, 19, 20, 21 who have their lives before them.  This legislation will multiply the number of impaired specialist.  So we will give these individuals a new lease on life, if you will, and give them the opportunity to be able to serve their country again in the capacity that they desire to do so.

I ask my colleagues to give this due considerations before this Committee.  And I thank the Gentle lady and the Ranking Member for their time and this Committee.  Thank you very much.

[The statement of Congresswoman Jackson-Lee appears in the Appendix.]

Ms. HERSETH SANDLIN. Thank you very much.  Thank you to all of you for making time to be here in what we all have our busy schedules.  I do hope that you will have time to stay for some questions.  I want to recognize the Ranking Member, Mr. Boozman for any opening statement or questions he may have of our colleagues.

Mr. BOOZMAN. In the interest of time the, and I know you all have got a myriad of things to do.  I really don’t have any questions, Madam Chairwoman.  And we will go ahead and defer to the rest of the panel.

Ms. HERSETH SANDLIN. We have also been joined by Mr. Walz and Mr. Moran.  Since the Ranking Member forwent some questions, I am going to recognize Mr. Moran, because he was here at the beginning of the hearing.  Mr. Moran.

Mr. MORAN. Madam Chair, thank you very much.  I thank you and the Ranking Member for making it possible for us to hear from our colleagues.  I don’t have any questions of the folks who have testified.  I just would commend them for their bringing us creative ideas and approaches as we try to figure out how do we best meet the needs of our veterans, both from the perspective of making certain that we are able to recruit and retain servicemen and women and that our commitments are met to those who do serve.

So I appreciate the interest and intensity with which you look at issues affecting veterans and I look forward to working with you to see that many of your ideas are accomplished in this Congress.  I thank the Chair.

Ms. HERSETH SANDLIN. Thank you, Mr. Moran.  Mr. Walz?

Mr. WALZ. Well, first of all, thank you Madam Chair for extending me the courtesy of being here today and to the Ranking Member, Mr. Boozman, I thank you.

I don’t have any specific questions, but I too would like to echo Mr. Moran’s thoughts.  I thank you for the passion you bring to these issues and I know as a 24-year veteran of the National Guard and someone who is deployed in these current missions, especially Mr. Israel the issue you bring up, is far more prevalent than anyone who hasn’t gone through it knows.  And I appreciate your thoughtfulness in that in realizing what a burden that is on the family.  And it is easy to set in this setting and for people to say, “Well maybe they just make a couple phone calls you it will be taken care of.”  It is not quite so simple.

So I truly appreciate your passion.  I appreciate the Chairwoman for having you here and bringing these thoughtful suggestions to us and things that I hope would love to see each one enacted.  So thank you.

Ms. HERSETH SANDLIN. Thank you, Mr. Walz, and for the valuable perspective you bring having served recently and your years of service in the National Guard.  Mr. Boozman?

Mr. BOOZMAN. Mr. Israel, one thing that does come up is, and again I am very supportive of what you are trying to get done, do you have any concern at all that in doing this that it might make it more difficult for those that are serving to actually get credit at a good rate as we start to do some of these things?

Mr. ISRAEL. Thank you, Mr. Boozman.  In formulating this legislation we consulted intensely with the consumer credit industry.  And in fact they indicated that that would be no problem whatsoever.  In fact, they felt that it would—on the other side of equation, it would strengthen those members credit and protect them from getting higher interest rates as a result of lower scores that were lowered without their knowledge.

Ms. HERSETH SANDLIN. Mr. Brady, the notation requirement in your bill, do you think that the notation of slow payment due to service should be made for all personnel on active duty, or should it be restricted for those active-duty servicemembers or activated Reservist who are in a combat zone?

Mr. BRADY. My bill states that those that are receiving combat pay.  Mobilized, they are in or deployed in the combat zone.

Ms. HERSETH SANDLIN. Can you elaborate on how you think the notation can be of assistance?  Does your bill also specify or would you be open to the issue of once there is a notation made for purposes of the servicemember, should there be problems upon his or her return, should there be a preservation of the pre-activation credit score or does the notation actually get transmitted to any entity that is requesting it?

Mr. BRADY. The notation would get put in by the three major credit agencies.  And they would be all you have to do is notify one and they will put a little notation in their credit that they were deployed at this certain time and they should not be penalized in any way, shape, or form.  Nor should their credit be altered in any way until they are on through their deployment and then they go back and have to pay their bill.

But it freezes that time frame when they are in combat, that they can’t have their credit hurt.  And I would be open to any kind of suggestion anybody would make to make this a better and stronger bill for our men and women in harms way.

Ms. HERSETH SANDLIN. Thank you.  I just wanted to clarify that once the notation is made, what is the practical effect of that?  If it freezes the current credit rating and their score, then we want to make sure that is specified.

Mr. BRADY. Yes.  It is incumbent upon the three major credit agencies.  When they receive a notation, any one of them have to share with the other two and that notation will be notified any time there is a credit problem or credit inquiry for this person at the time only when they were deployed.

Ms. HERSETH SANDLIN. Mr. Israel, I appreciate the consultation you have described with the credit industry and how this would work.  I certainly agree that the duty should be on the U.S. Department of Defense (DoD).  We all know individuals who have been activated and they have a lot of things on their mind as they prepare for their deployments.  To leave a lot of the financial issues either to a spouse or to parents causes a lot of difficulty and the duty should be on the DoD.

As we know, we have had problems particularly for the selected Reserve as it relates, at least in some early deployments, for TRICARE and the TRICARE coverage for those selected Reserve and their families.  Can you elaborate on how we are going to ensure that the DoD is going to effectively and efficiently notify the bureaus and keep track of this within the system?  I know you are on the Armed Services Committee, so perhaps there has been some oversight done already to ensure that the problems in TRICARE have been alleviated.

Mr. ISRAEL. Well I, Madam Chairwoman, I used to be on the Armed Services Committee and now I am on the Appropriations Committee.  My heart is still with the Armed Services Committee, my wallet is with the Appropriations Committee, however.

I will say that although this is a bipartisan bill co-sponsored by Mr. Davis, a Republican member of the Armed Services Committee, I cannot tell you that it is by river, meaning I can’t tell you that is the support or the opposition of the Pentagon.  So I want to state that for the record.

What we tried to do was find a logistically feasible and practical way for the Pentagon to alert credit bureaus to the change in status, rather than forcing the burden on the servicemember himself or herself.  And the simplest way to do it is to take advantage of the fact that when you are deployed into a combat environment, you actually receive a change in your pay check.  You receive combat pay, which means that somebody in the Pentagon has to go into the computer program and adjust your record so that you can get that additional pay.

And the idea was, while they are doing that they would just press another send button or another key that would alert the credit bureaus to the fact that this person is now in a combat environment and is under the protection of the Servicemembers Civil Relief Act. 

So essentially, it becomes a clerical responsibility by the Department of Defense, which is already engaged in the clerical responsibility of adjusting that person’s pay.  And then, when the person is deployed out of a combat environment, what happens is that the Pentagon readjusts the pay to the base amount without combat pay and would then notify the credit bureaus that this person is no longer in combat.

And so essentially we just add this one step to the Pentagon which is far better than adding 12 different steps as Mr. Brady says to the servicemember.

Ms. HERSETH SANDLIN. Yes, Mr. Brady.

Mr. BRADY. Not to get into an argument with my dear friend, he only has one step.  He only has to call one credit agency.  He doesn’t have to call all the others.  And it’s incumbent upon him, because it is his responsibility because it is his credit that is being hurt, rather than having to go to the Defense Department and rely on them pushing the button.  I am going to push that button.  I don’t know whether somebody in the bureaucracy is going to push it, because it affects me.

And what they do when the get orders, their orders say they are deployed for 18 months, 22 months, 12 months.  They have to go to other agencies to get their rights.  All they got to do is go to one other credit agency, give them a copy of their orders, 18 months they know that their credit will be on hold for 18 months.  They do it themselves.  No other jurisdiction has to get involved other than yourself.

Ms. HERSETH SANDLIN. I appreciate that.  Have either of you heard from any of the veterans service organizations with regard to specific support or specific concerns about either of your bills?

Mr. BRADY. Just applauding us for doing it.  Applauding us for doing it.

Mr. ISRAEL. I would echo that.  And I just want to state I don’t think there is a difference between Mr. Brady and I on this at all.  It is kind of a one, two punch.  There is under Mr. Brady’s bill the servicemember makes one call to a credit bureau, which I support.  Under my bill, there would be this additional requirement by the Department of Defense to alert the credit bureaus as well.

And I know that we are have been talking together about combining our efforts.  Is that fair to say?

Mr. BRADY. Sure.

Mr. ISRAEL. Okay.

Ms. HERSETH SANDLIN. Okay.  Well there may be some other areas that we want to explore.  We do have ten minutes left on the vote and I have one quick question for Ms. Jackson-Lee. 

But we want to address this issue in the most effective way possible.  And that is why we have the third and fourth panels that will be addressing each of the bills and we are wanting to work with you both in having approached this maybe slightly differently and maybe the initial bill and a supplement as you described it, Mr. Israel.  We may have some follow up questions for you.

Ms. Jackson Lee, I commend your efforts in this bill and the importance of this bill.  I, too, have looked at the issue specifically for disabled veterans for specially adaptive housing, as I mentioned in my opening statement.  I did seek a Congressional Budget Office (CBO) score on mine, which includes from the $50,000 to $60,000 which is $47 million over ten years.  Have you similarly sought a score for this bill as it relates to the cost of the scholarship program?

Ms. JACKSON-LEE. We are in the midst of doing that now.  I do want to make—I am glad you asked that question and I want to make sure that in the scholarship program only if you serve for a period of time and return your services to the Veterans Affairs Department will the debt be forgiven.  So at least there is a component where we are not providing this training and never getting a return in kind.

If you do not perform the commitment, then it as I indicated, it becomes a debt that you are obligated to pay as long as the request is made five years after the—before five years in after the agreement, but we are in the midst of determining that. 

I will say that I think that it will equate to a positive off set only because I want to share with you the U.S. Government Accountability Office (GAO) study more out patient rehabilitation services for blind veterans could better meet their needs.  And I think the cost of providing services because blind veterans or impaired veterans with impaired eyesight are not able to be mobile, are not able to work.  That cost may exponentially be, if you will, less when you equate it to what we would get if we provided these trained individuals who can help them become more able to work or more able to be more mobile in this instance.

So, I we will get that number to the Committee, but I believe it will be a number that will show that it is certainly more reasonable to do so in order to provide these services. 

And I would like to just certainly give more enthusiastic recognition of the Blind Veterans Association that includes this bill in their legislative update.  And rumor has it that the Veterans’ Affairs Department is supporting this legislation.  And I know that we don’t want to dwell on rumor, but I thought I would add that to the statement.

Thank you.  We will provide that information to the Committee.

[The 2004 GAO report, entitled  VA Health Care: More Outpatient Rehabilitation Services for Blind Veterans Could Better, Meet Their Needs, GAO-04-996T, referred to appears in the Appendix.]

Ms. HERSETH SANDLIN. Thank you.  Hopefully we will have the rumor confirmed on our fourth panel, but thank you.  I appreciate your response as it relates to the potential cost estimates and agree with your anticipation of what hopefully the CBO score will show.

Thank you, again, for making the time to take our questions and I do look forward, as I know the Ranking Member does, in working through some of these issues in better meeting the needs of our Nation’s veterans.

We will break now for the next series of votes and be back shortly for the second panel.


Ms. HERSETH SANDLIN. The Subcommittee will come to order.  Mr. Boozman and Mr. Reichert are both on their way, but because we are trying to fit in a lot this afternoon and the witnesses on our second panel have other places to be as does Ms. Brown-Waite who has joined us on the Subcommittee for this panel. I would like to go ahead and get started.

Our second panel is comprised of the Honorable Peter Welch; the Honorable Michael Michaud; and the Honorable David Reichert.  Mr. Welch, we will start with you.  You are recognized for five minutes.



Mr. WELCH. Thank you, Ms. Sandlin and the other Members of the Subcommittee.  I also want to acknowledge the presence of Mr. Michaud who has been a leader on issues involving veterans and very helpful to me and the veterans in Vermont.

Our bill that I am here today on has to do with the fact that historically, the Guard has been treated differently than the active-duty military.  And there may have been reasons for that in the past, but whatever they were, they don’t exist any longer, because as this Committee knows, as well as everyone in Congress, members of the National Guard are now front line troops whose responsibilities are to play a front line role in combat.

And let me just go through some of the problems that we can solve with the favorable consideration of the legislation before you.  A regularly discharged veteran who has some level of disability will typically have to wait about six months before receiving a disability check from the U.S. Department of Veterans Affairs (VA).  During that time period, veterans who suffer a disability are at their most vulnerable for divorce, for dislocation from work, from facing all the challenges of getting re-integrated into civilian life.

Now the Army came up with a pretty good program to help alleviate that, and they call it the Benefits Delivery at Discharge (BDD) Program.  And what it does is allow a member of the Armed Services to go through the disability determination process about six months before the discharge.  And most of the time the situation is not going to change in the next six months.  That has been incredibly successful, because what it has meant is that that soldier has had a disability determination before they leave the service and then upon discharge from the service they have got their rating and they are either getting the benefit or they are not, but they know the answer and they are able to move on with life immediately in their new status.

Reservist and Guardsmen, while they comprise now 40 percent of the combat forces in Iraq and Afghanistan, don’t have regular access to this benefit discharge program.  In my State of Vermont, in fact, we have sent 4,000 soldiers to Iraq and Afghanistan since September of 2001 and nearly half of them are from the Guard and the Reserves.

So all of us, obviously, know that we are asking first class service from our Guard and Reservist and we don’t want to give them second class benefits.  So in addition to the delay that is disproportionately imposed on applications from Guard and Reservist, there is a denial rate for their applications that is more than twice the denial rate for members of the regular Army.  And obviously since they are doing the same thing in the same place facing the same conditions, there are no real explanations other than systemic ones for that.

The denial rate has been documented in a study that was obtained under the Freedom of Information Act, but it was, just to be specific, 7.6 percent; but for National Guard and for the Reserves it was a denial rate of 17.8 percent.  So the bottom line here is that we have in place, through the Army, an excellent program, the Benefit Delivery at Discharge.  That is not as available to the Reservist and the Guard as it should be, because it works.  And the point of this legislation is to establish a degree of cooperation between the Army and the U.S. Department of Veterans Affairs (VA) to have this program be made available to our soldiers who are in the Reserve and in the Guard.

It is simple.  It is straight forward.  It is fair.  There is no reason to deny benefits simply because of administrative burdens as opposed to the merits of the case.  So I am pleased also, Madam Chair, to offer at this time with I hope unanimous consent into the record, a letter from the Adjutant General in Vermont, someone we are very proud of, two star General Michael Dubie who is in support of making this program available to the members of the Reserve and the Guard.

And I thank all of you for your excellent work.

[The statement of Congressman Welch, and attached  letter from the Adjutant General in Vermont, appear in the Appendix.]

Ms. HERSETH SANDLIN. Without objection, so entered.

Ms. HERSETH SANDLIN. We know you have been working closely with the State Adjutant General in Vermont.  We appreciate that.  Each of us has to work very closely with our State Adjutant Generals because they have a particular and unique perspective and understanding of what the men and women under their charge go through post-deployment.  We appreciate that and we will enter that for the record.

Mr. WELCH. Thank you.

Ms. HERSETH SANDLIN. Mr. Michaud, you are recognized.


Mr. MICHAUD. Thank you very much, Madam Chairwoman and Ranking Member Boozman.  I want to thank the Committee for allowing me testify this afternoon on H.R. 2475, the "Veterans Home Equity Conversion Mortgage Act of 2007."  I introduced H.R. 2475 with Congresswoman Brown-Waite of Florida to provide another tool for our aging veterans to help them live out their remaining years comfortably.

Our legislation would allow the VA to offer a home equity conversion mortgage to eligible elderly veteran homeowners aged 62 or older.  The Home Equity Conversion Mortgage enables our older home owners to convert their equity in their homes into tax free income without having to sell the home, give up the title, or take on a new monthly mortgage payment.

Instead of making monthly payments to a lender as with a regular mortgage, a Home Equity Conversion Mortgage converts the equity in the individual’s home to cash.  The lender makes the payment to the individual veteran.  With the rate of American home ownership at an all time high, Home Equity Conversion Mortgage have become a mainstream and highly successful financial planning tool for elderly home owners.

The Federal Housing Administration (FHA) endorsed 8,041 reverse mortgages during the month of April compared to 6,536 a year earlier.  If you take that out to seven months into the current fiscal year, FHA has endorsed 61,101 loans compared to 39,674 during the same period last year, which is a 54 percent increase.

The intent of H.R. 2475 is to allow the VA to offer reverse mortgages in the same way that FHA currently does.  Like the FHA Program, those interested in obtaining this type of mortgage must receive significant counseling.  The veteran must demonstrate a full understanding of the benefits and risk, as well as the consequences of his or her heirs before being deemed eligible for the loan.

While our legislation leaves it to the discretion of the Secretary, if the Secretary follows current VA home loan regulations, veterans would be eligible for higher available loan limits than the Farmers Home Administration Loan Program, which means more cash out to the veterans and a savings of roughly point five percent of interest rate, because monthly mortgage interest premiums are not required with VA guaranteed loans.

Elderly veterans should be offered this valuable tool, which allows them to cash out the equity that they have built up in their homes over 20, 30, or 40 years.  This would enable them to continue to meet the demand of increasing health, housing, and cost without their risking them losing their homes.  There is almost a no risk to veterans and very little risk to the VA.  This is truly a win, win opportunity.  This legislation would allow more veterans to remain in their homes longer without having to take on additional monthly bills or facing the prospect of losing their homes.

It will help them to enjoy the so called golden years of their lives.  And I want to thank the Chairwoman, Mr. Ranking Member, and also Congresswoman Brown-Waite for co-sponsoring this legislation with me.  With that, I yield back.

[The statement of Congressman Michaud appears in the Appendix]

Ms. HERSETH SANDLIN. Thank you, Mr. Michaud, and we appreciate the bipartisan efforts between you and Ms. Brown-Waite in introducing and advancing this legislation.

Mr. Reichert, welcome to the Subcommittee.  Thank you for appearing before us today and you are now recognized for five minutes.


Mr. REICHERT.   Sure I am glad to be there.  Madam Chairwoman, Ranking Member Boozman and members of the Subcommittee, thank you for the opportunity to testify in support of H.R. 1632, the "Improving Veterans Re-Employment Act."  Congressman Tim Walz, as you know, and I have worked together on this bipartisan legislation to enact an important technical fix to the tracking and reporting of re-employment complaints filed by people in the Guard and in the Reserves.

You will find Congressman Walz’s supporting testimony in your hearing documents.  So I am grateful that he has joined us here today, knowing that he is on the full Committee.  As you know, the Uniform Services Employment and Re-Employment Rights Act is meant to ensure that members of the Guard and Reserve return to the rights, seniority, and benefits of the civilian jobs they put on hold to defend our freedom.

The Departments of Labor and Defense are charged with assisting veterans and employers with this law and mediating disputes with the support of the Department of Justice and the Office of Special Counsel.  Labor submits an annual report to Congress on their re-employment complaints filed by veterans.  Early in 2005, I learned that Reservists and Guardsmen in my district and across the country were facing difficulties in returning to their civilian jobs.  I know from my former career as the Sheriff of King County in the Seattle area of Washington, that the best course of action comes when you collect information first.  And so, we went on an information search, gathering intelligence. 

We commissioned a GAO study to examine how thousands of members of the Guard and Reserve who are called up to serve in Iraq and Afghanistan were transitioning back into the civilian work force.  The study found that the Departments responsible for enforcing the Uniform Services Employment and Re-Employment Rights Act do not coordinate the tracking, sharing, or reporting of the complaint data they receive.

This compromises their ability to swiftly and effectively respond to the veterans' job needs.  The GAO s