[Appendix]
[Detailed Budget Estimates by Agency]
[Department of Veterans Affairs]
[From the U.S. Government Printing Office, www.gpo.gov]


                     THE BUDGET FOR FISCAL YEAR 2007

[[Page 955]]

 
                     DEPARTMENT OF VETERANS AFFAIRS

    The 2007 budget provides $35,697 million in discretionary funding 
for veterans health, benefits, and other services, including $38,530 
million in gross discretionary budget authority and $2,833 million in 
anticipated medical collections. VA is submitting its 2007 budget 
request using the account structure enacted in P.L. 109-114, the 
Military Construction, Military Quality of Life and Veterans Affairs 
Appropriations Act, 2006.

                                


 
                     VETERANS HEALTH ADMINISTRATION

                              Federal Funds

General and special funds:

                            Medical Services

                      (including transfer of funds)

    For necessary expenses for furnishing, as authorized by law, 
inpatient and outpatient care and treatment to beneficiaries of the 
Department of Veterans Affairs and veterans described in section 1705(a) 
of title 38, United States Code, including care and treatment in 
facilities not under the jurisdiction of the Department, and including 
medical supplies and equipment and salaries and expenses of health-care 
employees hired under title 38, United States Code, and aid to State 
homes as authorized by section 1741 of title 38, United States Code; 
[$22,547,141,000] $25,511,509,000, plus reimbursements[, of which not 
less than $2,200,000,000 shall be expended for specialty mental health 
care: Provided, That $1,225,000,000 of the amount provided under this 
heading is designated by the Congress as an emergency requirement 
pursuant to section 402 of H. Con. Res. 95 (109th Congress), the 
concurrent resolution on the budget for fiscal year 2006: Provided 
further, That such $1,225,000,000 shall be available only if an official 
budget request is transmitted by the President to the Congress that 
revises the President's budget amendment of July 14, 2005, to designate 
the entire $1,225,000,000 as an emergency requirement]: Provided 
[further], That of the funds made available under this heading, not to 
exceed $1,100,000,000 shall be available until September 30, [2007] 
2008: Provided further, That, notwithstanding any other provision of 
law, the Secretary of Veterans Affairs shall establish a priority for 
treatment for veterans who are service-connected disabled, lower income, 
or have special needs: Provided further, That, notwithstanding any other 
provision of law, the Secretary of Veterans Affairs shall give priority 
funding for the provision of basic medical benefits to veterans in 
enrollment priority groups 1 through 6: Provided further, That, 
notwithstanding any other provision of law, the Secretary of Veterans 
Affairs may authorize the dispensing of prescription drugs from Veterans 
Health Administration facilities to enrolled veterans with privately 
written prescriptions based on requirements established by the 
Secretary: Provided further, That the implementation of the program 
described in the previous proviso shall incur no additional cost to the 
Department of Veterans Affairs: Provided further, That for the 
Department of Defense/Department of Veterans Affairs Health Care Sharing 
Incentive Fund, as authorized by section 721 of Public Law 107-314, a 
minimum of $15,000,000, to remain available until expended, for any 
purpose authorized by section 8111 of title 38, United States Code. 
(Military Construction, Military Quality of Life and Veterans Affairs 
Appropriations Act, 2006.)
    [For an additional amount for ``Medical Services'', $198,265,000, 
for necessary expenses related to the consequences of hurricanes in the 
Gulf of Mexico in calendar year 2005: Provided, That the amount provided 
under this heading is designated as an emergency requirement pursuant to 
section 402 of H. Con. Res. 95 (109th Congress), the concurrent 
resolution on the budget for fiscal year 2006.]

          Special and Trust Fund Receipts (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-0160-0-1-703      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
01.00 Balance, start of year............         153         156         157
                                           ---------   ---------  ----------
01.99 Balance, start of year............         153         156         157
    Receipts:
02.20 Pharmaceutical co-payments, MCCF..         650         701         808
02.21 Pharmaceutical co-payments, MCCF--
        legislative proposal not subject 
        to PAYGO........................                                 288
02.22 Enhanced-use lease proceeds, MCCF.          27           1           1
02.23 First party collections, MCCF.....         119         120         120
02.24 First party collections, MCCF--
        legislative proposal not subject 
        to PAYGO........................                                 256
02.25 Third party collections, MCCF.....       1,056       1,178       1,304
02.26 Parking fees, MCCF................           3           4           4
02.27 Compensated work therapy, MCCF....          35          44          46
02.28 MCCF, Long-term care copayments...           5           6           6
02.40 Payments from compensation and 
        pension, MCCF...................           2           1           1
                                           ---------   ---------  ----------
02.99   Total receipts and collections..       1,897       2,055       2,834
                                           ---------   ---------  ----------
04.00 Total: Balances and collections...       2,050       2,211       2,991
    Appropriations:
05.00 Medical services..................      -1,894      -2,054      -2,289
05.01 Medical services--legislative 
        proposal not subject to PAYGO...                                -226
05.02 Medical services--legislative 
        proposal not subject to PAYGO...                                -288
05.03 Medical services--legislative 
        proposal not subject to PAYGO...                                 -30
                                           ---------   ---------  ----------
05.99   Total appropriations............      -1,894      -2,054      -2,833
                                           ---------   ---------  ----------
07.99 Balance, end of year..............         156         157         158
---------------------------------------------------------------------------

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-0160-0-1-703      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.01 Acute hospital care...............       4,685       4,882       5,270
00.02 Rehabilitative care...............         340         381         384
00.03 Psychiatric care..................         661         867         975
00.04 Nursing home care.................       2,183       2,083       2,220
00.05 Subacute care.....................          85          76          77
00.06 Residential care..................         174         211         240
00.07 Outpatient care...................      13,630      15,477      17,510
00.08 CHAMPVA...........................         527         597         665
                                           ---------   ---------  ----------
00.91   Total operating expenses........      22,285      24,574      27,341
01.01 Acute hospital care...............         139         159         191
01.02 Rehabilitative care...............          12          14          17
01.03 Psychiatric care..................          23          26          32
01.04 Nursing home care.................          45          51          62
01.05 Subacute care.....................           2           2           3
01.06 Residential care..................           5           6           7
01.07 Outpatient care...................         426         486         589
                                           ---------   ---------  ----------
01.91   Total capital investment........         652         744         901
                                           ---------   ---------  ----------
02.93   Total direct program............      22,937      25,318      28,242
09.01 Reimbursable program..............         170         175         182
                                           ---------   ---------  ----------
10.00   Total new obligations...........      23,107      25,493      28,424
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........         619         949         442
22.00 New budget authority (gross)......      23,438      24,986      27,982
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......      24,057      25,935      28,424
23.95 Total new obligations.............     -23,107     -25,493     -28,424
23.98 Unobligated balance expiring or 
        withdrawn.......................          -1
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........         949         442
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................      21,011      22,772      25,511
40.20   Appropriation (special fund)....       1,894       2,054       2,289
40.35   Appropriation permanently 
          reduced (P.L. 108-447)........        -156
41.00   Transferred to other accounts...        -166         -15
42.00   Transferred from other accounts.         685
                                           ---------   ---------  ----------

[[Page 956]]


43.00     Appropriation (total 
            discretionary)..............      23,268      24,811      27,800
      Spending authority from offsetting 
          collections:

        Discretionary:
68.00     Offsetting collections (cash).         146         175         182
68.10     Change in uncollected customer 
            payments from Federal 
            sources (unexpired).........          24
                                           ---------   ---------  ----------
68.90       Spending authority from 
              offsetting collections 
              (total discretionary).....         170         175         182
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................      23,438      24,986      27,982
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..       2,415       2,715       3,305
73.10 Total new obligations.............      23,107      25,493      28,424
73.20 Total outlays (gross).............     -22,773     -24,903     -27,321
73.40 Adjustments in expired accounts 
        (net)...........................         -24
74.00 Change in uncollected customer 
        payments from Federal sources 
        (unexpired).....................         -24
74.10 Change in uncollected customer 
        payments from Federal sources 
        (expired).......................          14
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..       2,715       3,305       4,408
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................      20,113      21,430      24,072
86.93 Outlays from discretionary 
        balances........................       2,660       3,473       3,249
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........      22,773      24,903      27,321
----------------------------------------------------------------------------

    Offsets:
      Against gross budget authority and outlays:

        Offsetting collections (cash) 
            from:
88.00     Federal sources...............         -89         -97         -98
88.40     Non-Federal sources...........         -70         -78         -84
                                           ---------   ---------  ----------
88.90       Total, offsetting 
              collections (cash)........        -159        -175        -182
      Against gross budget authority only:

88.95   Change in uncollected customer 
          payments from Federal sources 
          (unexpired)...................         -24
88.96   Portion of offsetting 
          collections (cash) credited to 
          expired accounts..............          13
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................      23,268      24,811      27,800
90.00 Outlays...........................      22,614      24,728      27,139
---------------------------------------------------------------------------

                 Summary of Budget Authority and Outlays

                        (in millions of dollars)

                                     2005 actual  2006 est.   2007 est.
Enacted/requested:
  Budget Authority............         23,268         24,811          27,800
  Outlays.....................         22,614         24,728          27,139
Legislative proposal, not subject to 
    PAYGO:
  Budget Authority............                                          -251
  Outlays.....................                                          -539
                                    ------------------------------------
Total:
  Budget Authority............         23,268         24,811          27,549
  Outlays.....................         22,614         24,728          26,600
                                    ====================================

    For 2007, the budget requests total resources for the VA Medical 
Services appropriation of $27.5 billion, and increase of $2.9 billion 
($2.2 billion in appropriation and $0.8 billion in collections) over the 
2007 level. This includes ($24.7 billion in appropriated budget 
authority and $2.8 billion to be collected in the Medical Care 
Collections Fund.

    The budget request level also includes a comprehensive set of 
legislative proposals that will continue to concentrate VA's health care 
resources to meet the needs of our highest priority core veterans--those 
with service-connected conditions, those with lower incomes, and 
veterans with special health care needs. These proposals are discussed 
in the Medical Services legislative proposal section.

    Medical Services.--Provides for a comprehensive, integrated health 
care delivery system that addresses the needs of eligible veterans and 
beneficiaries in VA medical centers, outpatient clinic facilities, 
contract hospitals, State homes, and outpatient programs on a fee basis. 
Hospital and outpatient care is also provided by the private sector for 
certain dependents and survivors of veterans under the Civilian Health 
and Medical Programs for the Department of Veterans Affairs (CHAMPVA).

    Medical Care Collections Fund (MCCF).--VA estimates collections of 
more than $2.8 billion, representing 8-percent of available resources 
(this includes the collections in the legislative proposal section). VA 
has the authority to collect inpatient and outpatient co-payments, 
medication co-payments, and nursing home co-payments; authority for 
certain income verification; authority to recover third-party insurance 
payments from veterans for nonservice-connected conditions; and 
authority to collect revenue from enhanced use leases. These collections 
also include those collected from the Compensated Work Therapy Program, 
Compensation and Living Expenses Program, and the Parking Program.

                                WORKLOAD

    Provision of Veterans Health Care--
        Acute hospital care.--Costs for 2007 are estimated to increase 
    by $169 million for operating medical, neurological, surgical, 
    contract and State home hospital beds.
        Estimated operating levels are:

                                     2005 actual  2006 est.   2007 est.
  Patients treated............        543,577        559,076         573,884
  Average daily census........          8,961          9,084           9,253
  Average employment..........         34,714         34,632          34,643

        Rehabilitative care.--An increase of $6 million in 2007 is 
    estimated for the provision of rehabilitative care, including spinal 
    cord injury care.
        Estimated operating levels are:

                                     2005 actual  2006 est.   2007 est.
  Patients treated............         15,253         15,429          15,493
  Average daily census........          1,210          1,210           1,210
  Average employment..........          3,355          3,416           3,416

        Psychiatric care.--An increase of $114 million is estimated in 
    2007 for the inpatient care of veterans with problems related to 
    mental illness, including alcohol and drug problems.
        Estimated operating levels are:

                                     2005 actual  2006 est.   2007 est.
  Patients treated............        109,604        109,132         108,767
  Average daily census........          4,363          4,340           4,286
  Average employment..........          6,205          6,205           6,820

        Nursing home care.--In 2007, an increase of $148 million is 
    estimated for the care of residents in VA nursing homes, contract 
    nursing homes and State nursing homes.
        Estimated operating levels are:

                                     2005 actual  2006 est.   2007 est.
  Patients treated............         99,158         94,562          96,474
  Average daily census........         34,375         33,378          34,358
  Average employment..........         14,394         14,377          14,377

        Noninstitutional extended care.--Included in outpatient 
    estimates in 2007 is an increase of $48 million estimated for 
    noninstitutional extended care programs such as adult day care; home 
    based primary care, skilled nursing and rehabilitation care; and 
    home health aids.
        Estimated operating levels are:
                                     2005 actual  2006 est.   2007 est.
  Average daily census........         27,469         32,105          36,722

        Subacute care.--An increase of $2 million is estimated in 2007 
    for the treatment of veterans who require a level of care between 
    acute and long-term care, as provided in VA hospital intermediate 
    bed sections.
        Estimated operating levels are:

                                     2005 actual  2006 est.   2007 est.
  Patients treated............         13,216         12,663          12,184

[[Page 957]]

  Average daily census........            399            345             327
  Average employment..........            832            816             805

        Residential care.--An increase of $30 million is estimated in 
    2007 for the care of veterans in locations other than their own 
    homes, such as domiciliary care programs.
        Estimated operating levels are:

                                     2005 actual  2006 est.   2007 est.
  Patients treated............         30,472         29,595          29,085
  Average daily census........          9,015         11,035          11,349
  Average employment..........          1,660          1,675           1,675

        Outpatient care.--An increase of $2.095 billion is estimated in 
    2007 for the cost of outpatient medical and dental care provided by 
    staff, physicians, and dentists participating under a fee basis 
    arrangement for certain eligible veterans.
        Estimated operating levels are:

              NUMBER OF MEDICAL VISITS AND DENTAL WORKLOADS

                                     2005 actual  2006 est.   2007 est.
  Medical visits (in thousands):
  Staff visits................         52,343         55,541          58,513
  Fee visits..................          4,846          5,450           5,943
  Readjustment counseling.....          1,047          1,075           1,100
                                    ------------------------------------
        Total.......................   58,236         62,066          65,556
                                    ====================================
  Dental:
    Staff:
      Examinations............        548,734        630,000         649,000
      Treatments..............        338,048        389,000         401,000
                                    ------------------------------------
        Total.......................  886,782      1,019,000       1,050,000
                                    ====================================
    Fee: Cases completed......         26,007         30,000          31,000
                                    ====================================
  Average employment..........         73,648         73,664          73,664
                                    ====================================

        Civilian health and medical program of the Department of 
    Veterans Affairs (CHAMPVA).--An increase of $68 million is estimated 
    in 2007 for private hospital and outpatient care for dependents and 
    survivors of certain veterans.

    Estimated operating levels are:

                                     2005 actual  2006 est.   2007 est.
  Average daily hospital 
    census....................            597            619             629
  Outpatient (in thousands)...          5,178          5,600           5,800

                          PERFORMANCE MEASURES

        Provide High Quality Health Care.--Use of clinical practice 
    guidelines in treating patients results in improved health of 
    veterans and reduced use of services. The prevention index 
    spotlights and summarizes a variety of evidenced based measures for 
    high quality preventive health care. VHA's strategy to monitor 
    satisfaction through patient surveys will identify areas of 
    improvement in all medical services.

                                     2005 actual  2006 est.   2007 est.
  Clinical Practice Guidelines 
    Index.....................            87%            77%             78%
  Prevention Index II.........            90%            88%             88%
  Percent of patients rating VA 
    health care service as very good 
    or excellent:
    Inpatient.................            77%            74%             74%
    Outpatient................            77%            73%             73%

        Access to Medical Care.--VA's strategy is to improve access and 
    timeliness of service by reducing waiting times in specialty and 
    primary care clinics in medical centers nationwide, and by relying 
    more extensively on non-institutional forms of long-term care.

                                     2005 actual  2006 est.   2007 est.
  Percentage of primary care 
    appointments scheduled 
    within 30 days of desired 
    date......................            96%            96%             96%
  Percentage of specialty care 
    appointments scheduled 
    within 30 days of desired 
    date......................            93%            93%             93%
  Increase non-institutional 
    long-term care as 
    expressed by average daily 
    census....................         27,469         32,105          36,722

        VA DoD Sharing.--VA's strategy is to improve collaboration and 
    exchange with DoD.

                                     2005 actual  2006 est.   2007 est.
  Documented increases in the 
    use of joint procurement 
    contracts.................       Baseline           150M           $160M
  Develop implementation 
    guides for consolidated 
    health informatics 
    standards adopted by VA 
    and DoD...................             NA              2         4 of 9 
                                                                   standards

        Revenue Cycle Improvement.--VHA is seeking to improve its 
    performance in the area of medical care collections. The revenue 
    cycle improvement plan includes initiatives that will improve 
    efficiency and accuracy.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-0160-0-1-703      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

      Direct obligations:

        Personnel compensation:
11.1      Full-time permanent...........       7,933       8,246       8,663
11.3      Other than full-time permanent         180         187         197
11.5      Other personnel compensation..         900         935         982
                                           ---------   ---------  ----------
11.9        Total personnel compensation       9,013       9,368       9,842
12.1    Civilian personnel benefits.....       2,415       2,572       2,729
13.0    Benefits for former personnel...           1          11          11
21.0    Employee travel.................          18          18          19
21.0    Beneficiary travel..............         189         209         234
21.0    All other.......................          42          44          47
22.0    Transportation of things........          12          12          15
23.3    Communications, utilities, and 
          miscellaneous charges.........         146         166         229
24.0    Printing and reproduction.......           1           1           1
25.2    Other contractual services......       2,010       2,353       3,348
25.6    Outpatient dental fees..........          38          45          58
25.6    Medical and nursing fees........         662         689         723
25.6    Community nursing homes.........         300         304         317
25.6    Contract hospitalization........         610         816         932
25.6    Civilian Health and Medical 
          Program of the Department of 
          Veterans Affairs (CHAMPVA)....         394         616         691
26.0    Medical supplies and materials..       5,928       6,739       7,495
31.0    Equipment.......................         647         784         901
32.0    Medical land and structures.....           5
41.0    Medical grants, subsidies, and 
          contributions.................         434         494         558
41.0    Medical grants to private 
          organizations.................          62          77          92
43.0    Interest and dividends..........          10
                                           ---------   ---------  ----------
99.0      Direct obligations............      22,937      25,318      28,242
99.0  Reimbursable obligations..........         170         175         182
                                           ---------   ---------  ----------
99.9    Total new obligations...........      23,107      25,493      28,424
---------------------------------------------------------------------------

                              Personnel Summary

----------------------------------------------------------------------------
Identification code 36-0160-0-1-703      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
    Direct:
1001  Civilian full-time equivalent 
        employment......................     133,270     133,270     138,207
    Reimbursable:
2001  Civilian full-time equivalent 
        employment......................       2,013       2,013       2,013
---------------------------------------------------------------------------

                            Medical Services

              (Legislative proposal, not subject to PAYGO)

    Title 38, United States Code, is amended--
    (1) To authorize an annual enrollment fee, as follows:
    (a) In section 1705, by inserting the following new subsection (d) 
at the end:
    ``(d) The Secretary may not enroll or continue the enrollment of a 
veteran under paragraph (a)(7) or (a)(8) unless the veteran annually 
pays to the United States an enrollment fee of $250.''.
    (b) In section 1729A(b), by redesignating paragraphs (1) through (8) 
as (2) through (9), and by inserting the following new paragaph (1):
    ``(1) Section 1705(d) of this title.''.
    (2) To authorize increased pharmacy copayments, as follows in 
section 1722A:
    (a) in subsection (1), by inserting ``eligible for care under 
section 1710(a)(1) or (a)(2)'' after the word, ``veteran,'' the first 
time it appears in paragraph (1);
    (b) in subsection (a), by striking out paragraph (2) and 
redesignating paragraph (3) as (2);
    (c) in subsection (b), paragraph (1), by striking out ``increase'' 
and inserting in lieu thereof, ``adjust'' and by inserting ``or (c)'' 
before ``; and'';

[[Page 958]]

    (d) in subsection (b), paragraph (2), by inserting ``or (c)'' after 
``subsection (a)''; and
    (e) by redesignating subsection (c) as ``(d)'' and inserting the 
following new subsection (c):
    ``(c) The Secretary shall require a veteran eligible for care under 
section 1710(a)(3) to pay the United States $15 for each 30-day supply 
of medication furnished such veteran under this chapter on an outpatient 
basis for the treatment of a nonservice-connected disability.''.
    (3) To prohibit the application of third party medical care 
collections to first party veteran debt, as follows:
    (a) section 1729 is amended by adding at the end thereof the 
following new subsection (j):
    ``(j) In the case of a veteran who is liable to the United States 
for a payment described in section 1710, 1710B, or 1722A with respect to 
care or services (including medication) furnished under this chapter, no 
amounts recovered or collected under this section may be applied in full 
or partial satisfaction of such liability of the veteran.''.
    Effective Date.--The amendments made by this section shall apply 
only with respect to a payment for which a veteran becomes liable under 
chapter 17 of title 38, United States Code, on and after the date of the 
enactment of this Act.

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-0160-2-1-703      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.01 Health care for veterans..........                                -251
                                           ---------   ---------  ----------
02.93   Total direct program............                                -251
                                           ---------   ---------  ----------
10.00   Total new obligations...........                                -251
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
22.00 New budget authority (gross)......                                -251
23.95 Total new obligations.............                                 251
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................                                -795
40.20   Annual Enrollment fee of $250 
          for Priority Level 7 and 8 
          veterans......................                                 226
40.20   Pharmaceutical copayments, 
          increase from $8 to $15 for 
          Priority Levels 7 and 8 
          veterans......................                                 288
40.20   Eliminate thrid party offset for 
          veterans copayments...........                                  30
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............                                -251
----------------------------------------------------------------------------

    Change in obligated balances:
73.10 Total new obligations.............                                -251
73.20 Total outlays (gross).............                                 539
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..                                 288
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................                                -539
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................                                -251
90.00 Outlays...........................                                -539
---------------------------------------------------------------------------

    The proposed legislation will allow the Department of Veterans 
Affairs to collect two user fees from priority level 7 and 8 (PL 7/8) 
veterans. The first user fee proposal will establish an annual 
enrollment fee of $250, and the second will increase pharmacy copayments 
from $8 to $15 for a 30-day supply of drugs. Both of these user fees 
will be charged to PL 7/8 veterans only. These proposals will continue 
to concentrate VA's health care resources to meet the needs of our 
highest priority core veterans--those with service-connected conditions, 
lower incomes, and special health care needs.

    Legislation is also being proposed that will allow VA to eliminate 
the third-party offset for first-party copayments similar to the 
practice in the private sector.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-0160-2-1-703      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

      Personnel compensation:

11.1    Full-time permanent.............                                 -87
11.3    Other than full-time permanent..                                  -2
11.5    Other personnel compensation....                                 -10
                                           ---------   ---------  ----------
11.9      Total personnel compensation..                                 -99
12.1  Civilian personnel benefits.......                                 -27
21.0  Beneficiary travel................                                  -3
22.0  Transportation of things..........                                  -2
23.3  Communications, utilities, and 
        miscellaneous charges...........                                 -27
25.2  Other contractual services........                                 -33
25.6  Medical and nursing fees..........                                  -7
26.0  Medical supplies and materials....                                 -53
                                           ---------   ---------  ----------
99.9    Total new obligations...........                                -251
---------------------------------------------------------------------------

                              Personnel Summary

----------------------------------------------------------------------------
Identification code 36-0160-2-1-703      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
    Direct:
1001  Civilian full-time equivalent 
        employment......................                              -4,285
    Reimbursable:
2001  Civilian full-time equivalent 
        employment......................
---------------------------------------------------------------------------

                                

                DOD-VA Health Care Sharing Incentive Fund

                      (including transfer of funds)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-0165-0-1-703      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.01 Direct program activity...........           6          20          30
                                           ---------   ---------  ----------
10.00   Total new obligations...........           6          20          30
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........          30          54          64
22.00 New budget authority (gross)......          30          30
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......          60          84          64
23.95 Total new obligations.............          -6         -20         -30
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........          54          64          34
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

42.00   Transferred from other accounts.          30          30
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............          30          30
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..                       5          11
73.10 Total new obligations.............           6          20          30
73.20 Total outlays (gross).............          -1         -14         -23
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..           5          11          18
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................                       8
86.93 Outlays from discretionary 
        balances........................           1           6          23
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........           1          14          23
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................          30          30
90.00 Outlays...........................           1          14          23
---------------------------------------------------------------------------

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-0165-0-1-703      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
25.1  Advisory and assistance services..           1          14          19
26.0  Supplies and materials............                       2           2
31.0  Equipment.........................           4           3           6
32.0  Land and structures...............           1           1           3
                                           ---------   ---------  ----------
99.9    Total new obligations...........           6          20          30
---------------------------------------------------------------------------



[[Page 959]]



    The purpose of the fund is to enable the Departments to carry out a 
program to identify and provide incentives to implement creative sharing 
initiatives at the facility, intra-regional and nationwide levels. The 
Departments have established the fund and developed processes and 
criteria to solicit and select projects. Section 721 of the FY 2003 
National Defense Authorization Act, Public Law 107-314, established the 
fund and requires VA and Department of Defense (DoD) to establish a 
joint incentive program. Each Secretary shall annually contribute a 
minimum of $15 million to the fund.

                                

                         Medical Administration

    For necessary expenses in the administration of the medical, 
hospital, nursing home, domiciliary, construction, supply, and research 
activities, as authorized by law; administrative expenses in support of 
capital policy activities; [uniforms or allowances therefor, as 
authorized by sections 5901-5902 of title 5, United States Code;] and 
administrative and legal expenses of the Department for collecting and 
recovering amounts owed the Department as authorized under chapter 17 of 
title 38, United States Code, and the Federal Medical Care Recovery Act 
(42 U.S.C. 2651 et seq.); [$2,858,442,000] $3,177,000,000, plus 
reimbursements, of which $250,000,000 shall be available until September 
30, [2007] 2008. (Military Construction, Military Quality of Life and 
Veterans Affairs Appropriations Act, 2006.)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-0152-0-1-703      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

    Obligations by program activity:
      Direct program:

        Operating expenses:
          Provision of veterans health 
              care:
00.01       Acute hospital care.........         703         817         833
00.02       Rehabilitative care.........          33          40          46
00.03       Psychiatric care............         211         233         255
00.04       Nursing home care...........         285         315         315
00.05       Subacute care...............          30          31          31
00.06       Residential care............          53          60          60
00.07       Outpatient care.............       2,684       1,505       1,610
                                           ---------   ---------  ----------
00.91       Total operating expenses....       3,999       3,001       3,150
        Capital investment:
          Provision of veterans health 
              care:
01.01       Acute hospital care.........         106           8           9
01.02       Rehabilitative care.........           6
01.03       Psychiatric care............          19           1           1
01.04       Nursing home care...........          43           3           3
01.05       Residential care............           6
01.06       Outpatient care.............         192          12          14
                                           ---------   ---------  ----------
01.91       Total capital investment....         372          24          27
                                           ---------   ---------  ----------
02.93   Total direct program............       4,371       3,025       3,177
09.01 Reimbursable program..............          45          50          52
                                           ---------   ---------  ----------
10.00   Total new obligations...........       4,416       3,075       3,229
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........          33          99           1
22.00 New budget authority (gross)......       4,483       2,977       3,229
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......       4,516       3,076       3,230
23.95 Total new obligations.............      -4,416      -3,075      -3,229
23.98 Unobligated balance expiring or 
        withdrawn.......................          -1
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........          99           1           1
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................       4,707       2,858       3,177
40.35   Appropriation permanently 
          reduced (P.L. 108-447)........         -38
41.00   Transferred to other accounts...        -232
42.00   Transferred from other accounts.                      69
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............       4,437       2,927       3,177
      Spending authority from offsetting 
          collections:

        Discretionary:
68.00     Offsetting collections (cash).          43          50          52
68.10     Change in uncollected customer 
            payments from Federal 
            sources (unexpired).........           3
                                           ---------   ---------  ----------
68.90       Spending authority from 
              offsetting collections 
              (total discretionary).....          46          50          52
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................       4,483       2,977       3,229
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..         656         839         833
73.10 Total new obligations.............       4,416       3,075       3,229
73.20 Total outlays (gross).............      -4,221      -3,081      -3,167
73.40 Adjustments in expired accounts 
        (net)...........................         -16
74.00 Change in uncollected customer 
        payments from Federal sources 
        (unexpired).....................          -3
74.10 Change in uncollected customer 
        payments from Federal sources 
        (expired).......................           7
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..         839         833         895
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................       3,632       2,401       2,622
86.93 Outlays from discretionary 
        balances........................         589         680         545
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........       4,221       3,081       3,167
----------------------------------------------------------------------------

    Offsets:
      Against gross budget authority and outlays:

        Offsetting collections (cash) 
            from:
88.00     Federal sources...............         -48         -48         -50
88.40     Non-Federal sources...........          -2          -2          -2
                                           ---------   ---------  ----------
88.90       Total, offsetting 
              collections (cash)........         -50         -50         -52
      Against gross budget authority only:

88.95   Change in uncollected customer 
          payments from Federal sources 
          (unexpired)...................          -3
88.96   Portion of offsetting 
          collections (cash) credited to 
          expired accounts..............           7
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................       4,437       2,927       3,177
90.00 Outlays...........................       4,171       3,031       3,115
---------------------------------------------------------------------------

    For 2007, the budget requests total resources for the VA Medical 
Administration appropriation of $3.2 billion, an increase of $250 
million over the 2006 level.

    The Medical Administration appropriation finances the expenses of 
management, security, and administration of the VA health care system 
through the operation of VA medical centers, other facilities, Veterans 
Integrated Service Networks offices and facility director offices, chief 
of staff operations, quality of care oversight, legal services, billing 
and coding activities, procurement, financial management, and human 
resource management. This appropriation also finances the National 
Program Administration, VHA headquarters, which provides corporate 
leadership and support to VA's comprehensive and integrated health care 
system with a Headquarters' staff that includes a capital facilities 
management and development process.

                                     2005 actual  2006 est.   2007 est.
Average employment............         35,652         35,652          35,652

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-0152-0-1-703      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

      Direct obligations:

        Personnel compensation:
11.1      Full-time permanent...........       1,756       1,871       1,947
11.3      Other than full-time permanent          40          43          44
11.5      Other personnel compensation..         200         213         221
                                           ---------   ---------  ----------
11.9        Total personnel compensation       1,996       2,127       2,212
12.1    Civilian personnel benefits.....         590         593         621
13.0    Benefits for former personnel...          11           2           3
21.0    Employee travel.................          34          26          27
21.0    All other.......................           1           1           1
22.0    Transportation of things........           7           6           6
23.3    Communications, utilities, and 
          miscellaneous charges.........         232          58          65
24.0    Printing and reproduction.......          10           4           4
25.2    Other contractual services......       1,043         132         156
25.6    Medical and nursing fees........           5           4           4
26.0    Medical supplies and materials..          69          48          51
31.0    Equipment.......................         365          21          24

[[Page 960]]

32.0    Medical land and structures.....           7           3           3
43.0    Interest and dividends..........           1
                                           ---------   ---------  ----------
99.0      Direct obligations............       4,371       3,025       3,177
99.0  Reimbursable obligations..........          45          50          52
                                           ---------   ---------  ----------
99.9    Total new obligations...........       4,416       3,075       3,229
---------------------------------------------------------------------------

                              Personnel Summary

----------------------------------------------------------------------------
Identification code 36-0152-0-1-703      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
    Direct:
1001  Civilian full-time equivalent 
        employment......................      35,385      35,362      35,328
    Reimbursable:
2001  Civilian full-time equivalent 
        employment......................         267         290         324
---------------------------------------------------------------------------

                                

                           Medical Facilities

    For necessary expenses for the maintenance and operation of 
hospitals, nursing homes, and domiciliary facilities and other necessary 
facilities for the Veterans Health Administration; for administrative 
expenses in support of planning, design, project management, real 
property acquisition and disposition, construction and renovation of any 
facility under the jurisdiction or for the use of the Department; for 
oversight, engineering and architectural activities not charged to 
project costs; for repairing, altering, improving or providing 
facilities in the several hospitals and homes under the jurisdiction of 
the Department, not otherwise provided for, either by contract or by the 
hire of temporary employees and purchase of materials; for leases of 
facilities; and for laundry and food services, [$3,297,669,000,] 
$3,569,000,000, plus reimbursements, of which $250,000,000 shall be 
available until September 30, [2007] 2008. (Military Construction, 
Military Quality of Life and Veterans Affairs Appropriations Act, 2006.)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-0162-0-1-703      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

    Obligations by program activity:
      Direct program:

        Operating expenses:
          Provision of veterans health 
              care:
00.01       Acute hospital care.........         740         752         765
00.02       Rehabilitative care.........          90          92         119
00.03       Psychiatric care............         305         311         377
00.04       Nursing home care...........         550         528         525
00.05       Subacute care...............          37          38          38
00.06       Residential care............         127         128         128
00.07       Outpatient care.............         880         971       1,014
                                           ---------   ---------  ----------
00.91       Total operating expenses....       2,729       2,820       2,966
        Capital investment:
          Provision of veterans health 
              care:
01.01       Acute hospital care.........         131         136         141
01.02       Rehabilitative care.........          11          11          12
01.03       Psychiatric care............          32          33          35
01.04       Nursing home care...........          69          72          75
01.05       Subacute care...............           4           4           4
01.06       Residential care............          14          15          15
01.07       Outpatient care.............         297         308         321
                                           ---------   ---------  ----------
01.91       Total capital investment....         558         579         603
      Grant Program:

                                           ---------   ---------  ----------
02.93     Total direct program..........       3,287       3,399       3,569
09.01 Reimbursable program..............          24          30          32
                                           ---------   ---------  ----------
10.00   Total new obligations...........       3,311       3,429       3,601
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........          59         102           1
22.00 New budget authority (gross)......       3,354       3,328       3,601
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......       3,413       3,430       3,602
23.95 Total new obligations.............      -3,311      -3,429      -3,601
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........         102           1           1
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................       3,792       3,298       3,569
40.35   Appropriation permanently 
          reduced (P.L. 108-447)........         -30
41.00   Transferred to other accounts...        -452
42.00   Transferred from other accounts.          20
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............       3,330       3,298       3,569
      Spending authority from offsetting 
          collections:

        Discretionary:
68.00     Offsetting collections (cash).          23          30          32
68.10     Change in uncollected customer 
            payments from Federal 
            sources (unexpired).........           1
                                           ---------   ---------  ----------
68.90       Spending authority from 
              offsetting collections 
              (total discretionary).....          24          30          32
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................       3,354       3,328       3,601
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..         658         921       1,046
73.10 Total new obligations.............       3,311       3,429       3,601
73.20 Total outlays (gross).............      -3,040      -3,304      -3,541
73.40 Adjustments in expired accounts 
        (net)...........................          -7
74.00 Change in uncollected customer 
        payments from Federal sources 
        (unexpired).....................          -1
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..         921       1,046       1,106
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................       2,456       2,925       3,175
86.93 Outlays from discretionary 
        balances........................         584         379         366
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........       3,040       3,304       3,541
----------------------------------------------------------------------------

    Offsets:
      Against gross budget authority and outlays:

        Offsetting collections (cash) 
            from:
88.00     Federal sources...............          -9         -12         -12
88.40     Non-Federal sources...........         -15         -18         -20
                                           ---------   ---------  ----------
88.90       Total, offsetting 
              collections (cash)........         -24         -30         -32
      Against gross budget authority only:

88.95   Change in uncollected customer 
          payments from Federal sources 
          (unexpired)...................          -1
88.96   Portion of offsetting 
          collections (cash) credited to 
          expired accounts..............           1
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................       3,330       3,298       3,569
90.00 Outlays...........................       3,016       3,274       3,509
---------------------------------------------------------------------------

    For 2007, the budget requests total resources for the VA Medical 
Facilities appropriation of $3.6 billion, an increase of $271 million 
over the 2006 level.

    Medical Facilities.--Provides for the operations and maintenance of 
the capital infrastructure required to provide health care to the 
Nation's veterans. These costs include utilities, engineering, capital 
planning, leases, laundry and food services, grounds maintenance, trash 
removal, housekeeping, fire protection, pest management, facility 
repair, and property disposition and acquisition.

                                     2005 actual  2006 est.   2007 est.
Average employment............         26,715         26,715          26,715

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-0162-0-1-703      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

      Direct obligations:

        Personnel compensation:
11.1      Full-time permanent...........         974       1,103       1,135
11.3      Other than full-time permanent          22          25          25
11.5      Other personnel compensation..         110         125         129
                                           ---------   ---------  ----------
11.9        Total personnel compensation       1,106       1,253       1,289
12.1    Civilian personnel benefits.....         322         233         243
13.0    Benefits for former personnel...           2           1           1
21.0    Employee travel.................           4           4           4

[[Page 961]]

21.0    All other.......................          21          22          24
22.0    Transportation of things........          14          14          16
23.1    Rental payments to GSA..........          15          15          16
23.2    Rental payments to others.......         108         110         120
23.3    Communications, utilities, and 
          miscellaneous charges.........         426         434         473
25.2    Other contractual services......         427         442         471
26.0    Medical supplies and materials..         203         207         221
26.0    Provisions......................          80          84          87
31.0    Equipment.......................          79          81          84
32.0    Medical land and structures.....         479         498         519
43.0    Interest and dividends..........           1           1           1
                                           ---------   ---------  ----------
99.0      Direct obligations............       3,287       3,399       3,569
99.0  Reimbursable obligations..........          24          30          32
                                           ---------   ---------  ----------
99.9    Total new obligations...........       3,311       3,429       3,601
---------------------------------------------------------------------------

                              Personnel Summary

----------------------------------------------------------------------------
Identification code 36-0162-0-1-703      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
    Direct:
1001  Civilian full-time equivalent 
        employment......................      26,548      26,537      26,537
    Reimbursable:
2001  Civilian full-time equivalent 
        employment......................         167         178         178
---------------------------------------------------------------------------

                                

                     Medical and Prosthetic Research

    For necessary expenses in carrying out programs of medical and 
prosthetic research and development as authorized by chapter 73 of title 
38, United States Code, to remain available until September 30, [2007] 
2008, [$412,000,000] $399,000,000, plus reimbursements[, of which not 
less than $15,000,000 shall be used for Gulf War Illness research]. 
(Military Construction, Military Quality of Life and Veterans Affairs 
Appropriations Act, 2006.)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-0161-0-1-703      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

    Obligations by program activity:
      Direct program:

        Operating expenses:
00.01     Bio-medical laboratory science 
            research....................         208         215         205
00.02     Rehabilitation research.......          45          47          45
00.03     Health services research......          60          62          59
00.04     Clinical science research.....          64          66          63
                                           ---------   ---------  ----------
00.91       Total operating expenses....         377         390         372
        Capital investment:
01.01     Bio-medical laboratory science 
            research....................          25          25          25
01.02     Rehabilitation research.......           6           6           6
01.03     Health services research......           2           3           2
01.04     Clinical science research.....           4           4           4
                                           ---------   ---------  ----------
01.91       Total capital investment....          37          38          37
                                           ---------   ---------  ----------
01.92     Total direct program..........         414         428         409
09.01 Reimbursable program..............          55          45          45
                                           ---------   ---------  ----------
10.00   Total new obligations...........         469         473         454
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........          53          41          25
22.00 New budget authority (gross)......         457         457         444
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......         510         498         469
23.95 Total new obligations.............        -469        -473        -454
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........          41          25          15
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................         405         412         399
40.35   Appropriation permanently 
          reduced.......................          -3
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............         402         412         399
      Discretionary:

68.00   Spending authority from 
          offsetting collections: 
          Offsetting collections (cash).          55          45          45
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................         457         457         444
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..         123         140         165
73.10 Total new obligations.............         469         473         454
73.20 Total outlays (gross).............        -454        -448        -441
73.40 Adjustments in expired accounts 
        (net)...........................          -2
74.10 Change in uncollected customer 
        payments from Federal sources 
        (expired).......................           4
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..         140         165         178
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................         289         327         317
86.93 Outlays from discretionary 
        balances........................         165         121         124
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........         454         448         441
----------------------------------------------------------------------------

    Offsets:
      Against gross budget authority and outlays:

88.00   Offsetting collections (cash) 
          from: Federal sources.........         -64         -45         -45
      Against gross budget authority only:

88.96   Portion of offsetting 
          collections (cash) credited to 
          expired accounts..............           9
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................         402         412         399
90.00 Outlays...........................         390         403         396
---------------------------------------------------------------------------

    For 2007, the total budgetary resources of $1.6 billion remain 
essentially unchanged. These resources are comprised of direct 
appropriations of $399 million, medical care support of $366 million and 
federal and private sector grants of $884 million, which represents 54 
percent of the total resources.

    This account is an intramural program whose mission is to acquire 
knowledge and create innovations that advance the health and care of 
veterans and the Nation. Veterans' health issues are addressed 
comprehensively in the following four program divisions and the medical 
care research support required for these programs:

    Biomedical Laboratory Research and Development Service.--This 
research strives to understand the disease process so that efficient, 
rational interventions can be made to cure or alleviate the effects of 
disease. The program supports investigator-initiated research projects, 
the training of clinicians in basic and clinical research, and centers 
of excellence devoted to specific diseases. The research is done in 
areas particularly relevant to the veteran population--aging, chronic 
disease, mental illness, substance abuse, military occupations, and 
environmental exposures.

    Rehabilitation Research and Development Service.--Rehabilitation 
Research is dedicated to the development and application of science and 
engineering to improve the care and quality of life for the physically 
disabled. The Service comprises investigator-initiated research 
projects, the training of clinicians and engineers in rehabilitation 
research, centers of excellence devoted to specific disabilities, and 
technology transfer. Areas particularly relevant to the disabled veteran 
population--aging, sensory loss, and trauma related illness, are the 
focus of the research.

    Health Services Research and Development Service.--Health Services 
Research is directed toward improving the outcome effectiveness and cost 
efficiency of health care delivery for the veteran population. 
Supporting the program are investigator-initiated research projects, the 
training of clinicians in applied clinical research, centers of 
excellence devoted to specific aspects of health care delivery, and 
service-directed projects addressing clinical management needs. The 
research focuses on the translation of research findings to clinical 
best practices for all veteran patients. Particular contributions are 
made in the areas of aging, substance abuse, health systems, and special 
populations.

    Clinical Science Research and Development Service.--Clinical Science 
Research will encompass interventional and observational studies in 
humans, including pharmacological and surgical studies.

[[Page 962]]

    VA's Medical and Prosthetic Research programs are included in the 
Federal Science & Technology (FS&T) budget.

                          PERFORMANCE MEASURES

    The VA Research program has adopted three new performance measures 
to assess its effectiveness in transferring research results to advance 
veterans' health care.

     Percent of milestones achieved towards development of a 
        standard clinical practice for pressure ulcers.

     Percent of milestones achieved towards development of a new 
        treatment for postraumatic stress disorder (PTSD).

     Accrual rate for multi-site clinical trials.

                                       Performance Measure
                                                    2005        2006        2007     Strategic 
                                                                                       Target
Number of peer-reviewed publications authored by 
    VA investigators within the fiscal year.....       2,793       2,655       2,623       3,000
Progress towards development of one new 
    treatment for post-traumatic stress disorder 
    (PTSD)......................................         40%         60%         67%        100%
Progess towards development of a standard 
    clinical practice for pressure ulcers.......         52%         65%         70%        100%
Study subject accrual rate for multi-site 
    clinical trials.............................         29%         32%         34%         50%

                      SUMMARY OF PROGRAM RESOURCES

                        [In millions of dollars]

                                     2005 actual  2006 est.   2007 est.
Medical and prosthetic 
research appropriation........            390            412             399
Federal resources.............            966          1,015           1,042
Other non-federal resources...            195            205             208
                                    ------------------------------------
      Total program resources.          1,551          1,632           1,649
                                    ====================================

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-0161-0-1-703      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

      Direct obligations:

        Personnel compensation:
11.1      Full-time permanent...........         134         141         132
11.3      Other than full-time permanent          14          15          14
11.5      Other personnel compensation..          28          29          27
                                           ---------   ---------  ----------
11.9        Total personnel compensation         176         185         173
12.1    Civilian personnel benefits.....          45          48          45
13.0    Benefits for former personnel...                       1           1
21.0    Employee travel.................           3           3           3
21.0    Travel and transportation of 
          persons.......................           1
23.1    Rental payments to GSA..........           1           1           1
23.3    Communications, utilities, and 
          miscellaneous charges.........           1           1           1
24.0    Printing and reproduction.......           1           1           1
25.2    Other services..................         122         129         125
26.0    Supplies and materials..........          32          32          32
31.0    Equipment.......................          31          27          27
32.0    Land and structures.............           1
                                           ---------   ---------  ----------
99.0      Direct obligations............         414         428         409
99.0  Reimbursable obligations..........          55          45          45
                                           ---------   ---------  ----------
99.9    Total new obligations...........         469         473         454
---------------------------------------------------------------------------

                              Personnel Summary

----------------------------------------------------------------------------
Identification code 36-0161-0-1-703      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
    Direct:
1001  Civilian full-time equivalent 
        employment......................       2,946       2,865       2,579
    Reimbursable:
2001  Civilian full-time equivalent 
        employment......................         260         260         260
---------------------------------------------------------------------------

    In addition to research staff shown above, 5,100 staff carry out 
research at VA supported by other Federal and non-Federal resources.

                                

                     Canteen Service Revolving Fund

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-4014-0-3-705      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

    Obligations by program activity:
09.01 Reimbursable operating expenses...         146         148         148
09.02 Reimbursable direct operations....          98          99          99
09.10 Reimbursable capital investment: 
        Sales program: Purchase of 
        equipment and leasehold.........           5           5           5
                                           ---------   ---------  ----------
10.00   Total new obligations...........         249         252         252
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........           9           6           2
22.00 New budget authority (gross)......         247         248         253
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......         256         254         255
23.95 Total new obligations.............        -249        -252        -252
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........           6           2           3
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Spending authority from offsetting 
          collections:

        Mandatory:
69.00     Offsetting collections (cash).         247         248         253
69.00     Offsetting collections (from 
            investment).................
                                           ---------   ---------  ----------
69.90       Spending authority from 
              offsetting collections 
              (total mandatory).........         247         248         253
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..          22          30          33
73.10 Total new obligations.............         249         252         252
73.20 Total outlays (gross).............        -241        -249        -253
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..          30          33          32
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.97 Outlays from new mandatory 
        authority.......................         238         247         252
86.98 Outlays from mandatory balances...           3           2           1
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........         241         249         253
----------------------------------------------------------------------------

    Offsets:
      Against gross budget authority and outlays:

88.40   Offsetting collections (cash) 
          from: Non-Federal sources.....        -247        -248        -253
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................
90.00 Outlays...........................          -6           1
----------------------------------------------------------------------------

    Memorandum (non-add) entries:
92.01 Total investments, start of year: 
        Federal securities: Par value...          30          26          24
92.02 Total investments, end of year: 
        Federal securities: Par value...          26          24          20
---------------------------------------------------------------------------

    The Veterans Canteen Service was established to furnish, at 
reasonable prices, merchandise and services necessary for the comfort 
and well-being of veterans in VA medical facilities.

    Financing.--Operations will be financed from current revenues.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-4014-0-3-705      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

      Personnel compensation:

11.1    Full-time permanent.............          43          45          46
11.3    Other than full-time permanent..          36          37          37
                                           ---------   ---------  ----------
11.9      Total personnel compensation..          79          82          83
12.1  Civilian personnel benefits.......          20          21          22
21.0  Travel and transportation of 
        persons.........................           2           1           1
25.2  Other services....................           3           3           4
26.0  Supplies and materials............         139         140         137
31.0  Equipment.........................           6           5           5
                                           ---------   ---------  ----------
99.9    Total new obligations...........         249         252         252
---------------------------------------------------------------------------

[[Page 963]]



                              Personnel Summary

----------------------------------------------------------------------------
Identification code 36-4014-0-3-705      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
    Reimbursable:
2001  Civilian full-time equivalent 
        employment......................       2,952       2,940       2,950
---------------------------------------------------------------------------

                                

                  Medical Center Research Organizations

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-4026-0-3-703      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

    Obligations by program activity:
09.01 Operating expenses................         161         161         165
09.02 Capital investments...............          19          19          19
                                           ---------   ---------  ----------
10.00   Total new obligations...........         180         180         184
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........          16          23          23
22.00 New budget authority (gross)......         187         180         190
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......         203         203         213
23.95 Total new obligations.............        -180        -180        -184
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........          23          23          29
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Mandatory:

69.00   Spending authority from 
          offsetting collections 
          (gross): Offsetting 
          collections (cash)............         187         180         190
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..           7
73.10 Total new obligations.............         180         180         184
73.20 Total outlays (gross).............        -187        -180        -190
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..                                  -6
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.97 Outlays from new mandatory 
        authority.......................         187         180         190
----------------------------------------------------------------------------

    Offsets:
      Against gross budget authority and outlays:

88.40   Offsetting collections (cash) 
          from: Non-Federal sources.....        -187        -180        -190
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................
90.00 Outlays...........................
---------------------------------------------------------------------------

    These nonprofit corporations provide a flexible funding mechanism 
for the conduct of approved research at Department of Veterans Affairs 
medical centers. These organizations will derive funds to operate 
various research activities from Federal and non-Federal sources. No 
appropriation is required to support these activities.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-4026-0-3-703      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
21.0  Travel and transportation of 
        persons.........................           5           2           2
25.2  Other services....................         142         112         116
26.0  Supplies and materials............          14          47          47
31.0  Equipment.........................          19          19          19
                                           ---------   ---------  ----------
99.9    Total new obligations...........         180         180         184
---------------------------------------------------------------------------

                                

                               Trust Funds

                    General Post Fund, National Homes

                      (including transfer of funds)

          Special and Trust Fund Receipts (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-8180-0-7-705      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
01.00 Balance, start of year............           1           1           3
                                           ---------   ---------  ----------
01.99 Balance, start of year............           1           1           3
    Receipts:
02.00 General post fund, national homes, 
        Interest on investments.........           2           3           3
02.60 General post fund, national homes, 
        Deposits........................          29          32          33
                                           ---------   ---------  ----------
02.99   Total receipts and collections..          31          35          36
                                           ---------   ---------  ----------
04.00 Total: Balances and collections...          32          36          39
    Appropriations:
05.00 General post fund, national homes.         -31         -33         -33
                                           ---------   ---------  ----------
07.99 Balance, end of year..............           1           3           6
---------------------------------------------------------------------------

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-8180-0-7-705      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.01 Religious, recreational, and 
        entertainment activities........          29          30          31
00.03 Therapeutic residence maintenance.           1           1           2
                                           ---------   ---------  ----------
10.00   Total new obligations...........          30          31          33
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........          62          63          65
22.00 New budget authority (gross)......          31          33          33
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......          93          96          98
23.95 Total new obligations.............         -30         -31         -33
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........          63          65          65
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Mandatory:

60.26   Appropriation (trust fund)......          31          33          33
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..           5           4           3
73.10 Total new obligations.............          30          31          33
73.20 Total outlays (gross).............         -31         -32         -31
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..           4           3           5
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.97 Outlays from new mandatory 
        authority.......................                      32          31
86.98 Outlays from mandatory balances...          31
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........          31          32          31
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................          31          33          33
90.00 Outlays...........................          31          32          31
----------------------------------------------------------------------------

    Memorandum (non-add) entries:
92.01 Total investments, start of year: 
        Federal securities: Par value...          67          64          64
92.02 Total investments, end of year: 
        Federal securities: Par value...          64          64          64
---------------------------------------------------------------------------

    This fund consists of: gifts, bequests, and proceeds from the sale 
of property left in the care of the facilities by former beneficiaries; 
patients' fund balances; and, proceeds from the sale of effects of 
beneficiaries who die leaving no heirs or without having otherwise 
disposed of their estate. Such funds are used to promote the comfort and 
welfare of veterans at hospitals, nursing homes, and domiciliaries where 
no general appropriation is available. Public Law 102-54 authorizes 
compensation work therapy and therapeutic transitional housing and loan 
programs to be funded from the General Post Fund. (38 U.S.C. chs. 83 and 
85.)


[[Page 964]]



               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-8180-0-7-705      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
21.0  Travel and transportation of 
        persons.........................           2           2           2
25.2  Other services....................          15          17          19
26.0  Supplies and materials............          10           9           9
31.0  Equipment.........................           2           2           2
32.0  Land and structures...............           1           1           1
                                           ---------   ---------  ----------
99.9    Total new obligations...........          30          31          33
---------------------------------------------------------------------------

                                


 
                       VETERANS BENEFITS PROGRAMS

                              Federal Funds

General and special funds:

                        Compensation and Pensions

                      (including transfer of funds)

    For the payment of compensation benefits to or on behalf of veterans 
and a pilot program for disability examinations as authorized by law (38 
U.S.C. 107, chapters 11, 13, 18, 51, 53, 55, and 61); pension benefits 
to or on behalf of veterans as authorized by law (38 U.S.C. chapters 15, 
51, 53, 55, and 61; 92 Stat. 2508); and burial benefits, the Reinstated 
Entitlement Program for Survivors, emergency and other officers' 
retirement pay, adjusted-service credits and certificates, payment of 
premiums due on commercial life insurance policies guaranteed under the 
provisions of title IV of the Servicemembers Civil Relief Act (50 U.S.C. 
App. 540 et seq.) and for other benefits as authorized by law (38 U.S.C. 
107, 1312, 1977, and 2106, chapters 23, 51, 53, 55, and 61; 43 Stat. 
122, 123; 45 Stat. 735; 76 Stat. 1198), [$33,897,787,000] 
$38,007,095,000, to remain available until expended: Provided, That not 
to exceed [$23,491,000] $24,512,000 of the amount appropriated under 
this heading shall be reimbursed to ``General operating expenses'' and 
``Medical administration'' for necessary expenses in implementing the 
provisions of chapters 51, 53, and 55 of title 38, United States Code, 
the funding source for which is specifically provided as the 
``Compensation and pensions'' appropriation: Provided further, That such 
sums as may be earned on an actual qualifying patient basis, shall be 
reimbursed to ``Medical care collections fund'' to augment the funding 
of individual medical facilities for nursing home care provided to 
pensioners as authorized. (Military Construction, Military Quality of 
Life and Veterans Affairs Appropriations Act, 2006.)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-0102-0-1-701      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

    Obligations by program activity:
01.01 Veterans..........................      24,445      26,666      29,423
01.02 Survivors.........................       4,197       4,479       4,662
                                           ---------   ---------  ----------
01.91   Compensation sub-total..........      28,642      31,145      34,085
                                           ---------   ---------  ----------
02.00   Other compensation expenses.....      28,642      31,145      34,085
02.01 Chapter 18........................          17          18          19
02.02 Clothing allowance................          51          54          57
02.03 Misc Assistance (EAJ, SAFD).......           4           4           3
02.04 Medical exam pilot program........          68          81          85
02.05 OBRA payment to VBA...............           1           2           2
02.06 Reinstated Entitlement Program for 
        Survivors.......................                       7           7
                                           ---------   ---------  ----------
02.91   Total other compensation 
          expenses......................         141         166         173
                                           ---------   ---------  ----------
02.93   Total compensation..............      28,783      31,311      34,258
03.02 Veterans..........................       2,652       2,734       2,796
03.03 Survivors.........................         731         739         745
                                           ---------   ---------  ----------
03.91   Pensions sub total..............       3,383       3,473       3,541
04.01 Reimbursements to GOE and VHA.....          20          22          23
                                           ---------   ---------  ----------
04.92   Total pensions..................       3,403       3,495       3,564
06.02 Burial allowance..................          31          37          39
06.03 Burial plots......................          17          20          21
06.04 Service-connected deaths..........          23          28          29
06.05 Burial flags......................          18          19          19
06.06 Headstones and markers............          38          41          42
06.07 Graveliners/Pre-placed crypts.....          25          30          35
                                           ---------   ---------  ----------
06.91   Total burial program............         152         175         185
09.01 Reinstated Entitlement Program for 
        Survivors.......................          10
                                           ---------   ---------  ----------
09.99   Total reimbursable program......          10
                                           ---------   ---------  ----------
10.00   Total new obligations...........      32,348      34,981      38,007
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........       1,060       1,083
22.00 New budget authority (gross)......      32,372      33,898      38,007
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......      33,432      34,981      38,007
23.95 Total new obligations.............     -32,348     -34,981     -38,007
23.98 Unobligated balance expiring or 
        withdrawn.......................          -1
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........       1,083
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Mandatory:

60.00   Appropriation...................      32,608      33,898      37,417
60.00   Appropriaton COLA...............                                 590
61.00   Transferred to other accounts...        -246
                                           ---------   ---------  ----------
62.50     Appropriation (total 
            mandatory)..................      32,362      33,898      38,007
      Mandatory:

69.00   Spending authority from 
          offsetting collections: 
          Offsetting collections (cash) 
          REPS..........................          10
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................      32,372      33,898      38,007
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..       2,442          88          59
73.10 Total new obligations.............      32,348      34,981      38,007
73.20 Total outlays (gross).............     -34,703     -35,010     -34,979
73.40 Adjustments in expired accounts 
        (net)...........................           1
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..          88          59       3,087
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.97 Outlays from new mandatory 
        authority.......................      31,201      33,840      34,920
86.98 Outlays from mandatory balances...       3,502       1,170          59
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........      34,703      35,010      34,979
----------------------------------------------------------------------------

    Offsets:
      Against gross budget authority and outlays:

88.00   Offsetting collections (cash) 
          from: Federal sources.........         -10
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................      32,362      33,898      38,007
90.00 Outlays...........................      34,694      35,010      34,979
---------------------------------------------------------------------------

                                WORKLOAD

  Compensation:                      2005 actual  2006 est.   2007 est.

  Rating-Related Actions......        703,167        822,441         738,747
  Non Rating Actions..........        246,068        253,451         258,519

                                WORKLOAD

  Pension:                           2005 actual  2006 est.   2007 est.

  Rating-Related Actions......         85,131         87,685          89,439
  Non Rating Actions..........        274,082        282,304         287,950

    This appropriation provides for the payment of compensation, 
pension, and burial benefits to veterans and survivors.

    Compensation is paid to veterans for disabilities incurred in or 
aggravated during active military service. Dependency and Indemnity 
Compensation is paid to survivors of servicepersons or veterans whose 
death occurred while on active duty or as a result of service-connected 
disabilities. Compensation and vocational rehabilitation is provided to 
the children of Vietnam veterans who were born with certain birth 
defects. The Secretary may pay a clothing allowance to each veteran who 
uses a prescribed medication for a service-connected skin condition or 
wears a prosthetic or orthopedic appliance (including a wheelchair) 
which, in the judgment of

[[Page 965]]

the Secretary, tends to damage or tear the clothing of such veteran.

    Miscellaneous benefits provided for are:
        (a) payments for claims made pursuant to the provision of the 
    World War Adjusted Compensation Act of 1924, as amended;
        (b) a special allowance (38 U.S.C. 1312) to dependents of 
    certain veterans who died after December 31, 1956, but who were not 
    fully and currently insured under the Social Security Act; and
        (c) payments authorized by the Equal Access to Justice Act.

    The appropriation also provides for a pilot program authorizing VA 
to contract out medical examinations to determine service-connected 
disabilities of veterans who are potential applicants of compensation 
benefits and a program to allow VA to perform income matches for certain 
compensation recipients.

    In accordance with Public Law 97-377, the Reinstated Entitlement 
Program for Survivors (REPS) program restores social security benefits 
to certain surviving spouses or children of veterans who died of 
service-connected causes.

    Legislation is proposed to provide a cost-of-living adjustment 
comparable to the annual social security increase to recipients of 
disability compensation, dependency and indemnity compensation, and 
clothing allowances. The increase, effective with payments made on 
January 1, 2007, is expected to be 2.6 percent.

            AVERAGE NUMBER OF COMPENSATION CASES AND PAYMENTS

                                     2005 actual  2006 est.   2007 est.
Veterans:
  Cases.......................      2,600,583      2,713,606       2,867,013
  Average payment per case, 
    per year..................         $9,400         $9,827         $10,263
                                    ------------------------------------
      Total obligations (in 
        millions).............        $24,445        $26,666         $29,961
                                    ====================================
Survivors:
  Total.......................        326,272        340,318         348,479
  Average payment per case, 
    per year..................        $12,865        $13,161         $13,378
                                    ------------------------------------
      Total obligations (in 
        millions).............         $4,197         $4,479          $4,662
                                    ====================================
Chapter 18:
  Children....................          1,171          1,219           1,234
  Average payment per case, 
    per year..................        $14,782        $15,389         $15,789
                                    ------------------------------------
      Total obligations (in 
        millions).............            $17            $18             $19
                                    ====================================
Clothing allowance:
  Number of veterans..........         82,333         83,644          87,053
  Average payment per case, 
    per year..................           $615           $641            $657
                                    ------------------------------------
      Total obligations (in 
        millions).............            $51            $54             $57
                                    ====================================
Other compensation caseload:
  Special allowance dependents            110            102              94
  Equal Access to Justice 
    payments..................            803            803             803
                                    ====================================
REPS:
  Cases.......................            306            393             298
  Average benefit.............        $29,438        $18,572         $22,720
                                    ------------------------------------
      Obligations (in 
        millions).............             $9             $7              $6
                                    ====================================

    Pension benefits may be paid to veterans or their survivors. A 
veteran's entitlement is based on active duty service of a specific 
length (normally 90 days or more) during a designated war period, 
disabilities considered permanent and total, and countable income below 
established levels. There is no disability requirement for survivor 
cases or veterans age 65 or older. Income support is provided at 
established benefit levels.

    An automatic annual cost-of-living increase comparable to the annual 
social security increase is provided for those pensioners in the 
improved program and to parents receiving dependency and indemnity 
compensation. The increase, effective with payments made on January 1, 
2007, is expected to be 2.6 percent.

              AVERAGE NUMBER OF PENSION CASES AND PAYMENTS

                                     2005 actual  2006 est.   2007 est.
Veterans:
  Cases.......................        337,787        330,764         325,305
  Average payment per case, 
    per year..................         $7,850         $8,266          $8,594
                                    ------------------------------------
      Total obligations (in 
        millions).............         $2,652         $2,734          $2,796
                                    ====================================
Survivors:
  Total.......................        211,240        202,699         194,504
  Average payment per case, 
    per year..................         $3,460         $3,646          $3,828
                                    ------------------------------------
      Total obligations (in 
        millions).............           $731           $739            $745
                                    ====================================

    Burial benefits provides for: (a) the payment of an allowance of 
$300 (plus transportation charges where death occurs under VA care) to 
reimburse, in part, the burial and funeral expense of an eligible 
deceased veteran; (b) the payment of $300 for a plot allowance where an 
eligible veteran is not buried in a national cemetery or other cemetery 
under the jurisdiction of the United States; (c) the payment of a burial 
allowance up to $2,000 when a veteran dies as a result of service-
connected disability; (d) furnishing a flag to drape the casket of each 
deceased veteran entitled thereto; (e) furnishing a headstone or marker 
for the grave of a veteran and, in certain cases, eligible dependents; 
and (f) authority to provide outer burial receptacles in the National 
Cemetery Administration.

                        NUMBER OF BURIAL BENEFITS

                                     2005 actual  2006 est.   2007 est.
Burial allowance..............         81,254         82,033          82,843
Burial plot...................         63,769         65,581          67,430
Service-connected dealth......         13,578         13,938          14,304
Burial flags..................        540,000        542,415         544,518
Headstones and markers........        350,183        356,257         355,388
Graveliners...................         59,965         66,702          57,884
Preplaced crypts..............         32,282         46,000          65,600

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-0102-0-1-701      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
42.0  Direct obligations: Insurance 
        claims and indemnities..........      32,338      34,981      38,007
99.0  Reimbursable obligations: 
        Reimbursable obligations........          10
                                           ---------   ---------  ----------
99.9    Total new obligations...........      32,348      34,981      38,007
---------------------------------------------------------------------------

                                

                          Readjustment Benefits

    For the payment of readjustment and rehabilitation benefits to or on 
behalf of veterans as authorized by law (38 U.S.C. chapters 21, 30, 31, 
34, 35, 36, 39, 51, 53, 55, and 61), [$3,309,234,000] $3,262,006,000, to 
remain available until expended: Provided, That expenses for 
rehabilitation program services and assistance which the Secretary is 
authorized to provide under section 3104(a) of title 38, United States 
Code, other than under subsection (a)(1), (2), (5), and (11) of that 
section, shall be charged to this account. (Military Construction, 
Military Quality of Life and Veterans Affairs Appropriations Act, 2006.)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-0137-0-1-702      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

    Obligations by program activity:
01.01 Sons and daughters................         342         378         410
01.02 Spouses...........................          47          52          57
                                           ---------   ---------  ----------
01.91   Total education and training....         389         430         467
02.01 Vocational rehabilitation training         336         366         399
02.02 Subsistence allowance.............         229         242         259
02.03 Automobiles and adaptive equipment          54          60          67
02.04 Housing Grants....................          28          29          29
                                           ---------   ---------  ----------
02.91   Total special assistance to 
          disabled veterans.............         647         697         754

[[Page 966]]

03.01 Work study........................          25          26          27
03.02 Payments to States................          18          19          19
03.03 All-volunteer assistance: Basic 
        benefits and all other..........       1,788       2,069       2,159
03.04 Tuition Assistance................          19          20          21
03.05 Licensing and Certification.......           1           1           1
03.06 Reporting fees....................           4           4           4
03.09 Reimbursement to GOE..............           1           8           2
                                           ---------   ---------  ----------
03.91   Total All-volunteer assistance 
          and other.....................       1,856       2,147       2,233
                                           ---------   ---------  ----------
03.93   Total Readjustment Benefits 
          Direct Program................       2,892       3,274       3,454
09.01 Veterans' and Servicepersons basic 
        benefits........................           5           5           5
09.02 Veterans' and Servicepersons 
        supplementary benefits..........          93          98          98
09.03 Chapter 1606 Reservists benefits..         131         127         148
09.04 Chapter 1606 Reservists 
        supplementary benefits..........          56          54          63
09.05 Chapter 1607 Reservists benefits..                     148         192
09.06 National Call to Service..........                       1           3
                                           ---------   ---------  ----------
09.09   Total Reimbursable education 
          program.......................         285         433         509
                                           ---------   ---------  ----------
10.00   Total new obligations...........       3,177       3,707       3,963
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........         247         157         192
22.00 New budget authority (gross)......       3,087       3,742       3,771
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......       3,334       3,899       3,963
23.95 Total new obligations.............      -3,177      -3,707      -3,963
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........         157         192
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Mandatory:

60.00   Appropriation...................       2,556       3,309       3,262
62.00   Transferred from other accounts.         246
                                           ---------   ---------  ----------
62.50     Appropriation (total 
            mandatory)..................       2,802       3,309       3,262
      Mandatory:

69.00   Spending authority from 
          offsetting collections: 
          Offsetting collections (cash).         285         433         509
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................       3,087       3,742       3,771
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..          82          37          49
73.10 Total new obligations.............       3,177       3,707       3,963
73.20 Total outlays (gross).............      -3,222      -3,695      -3,916
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..          37          49          96
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.97 Outlays from new mandatory 
        authority.......................       2,893       3,501       3,675
86.98 Outlays from mandatory balances...         329         194         241
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........       3,222       3,695       3,916
----------------------------------------------------------------------------

    Offsets:
      Against gross budget authority and outlays:

88.00   Offsetting collections (cash) 
          from: Federal sources.........        -285        -433        -509
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................       2,802       3,309       3,262
90.00 Outlays...........................       2,937       3,262       3,407
---------------------------------------------------------------------------

                              WORKLOAD \1\

                                     2005 actual  2006 est.   2007 est.
Evaluation and planning.......         26,501         27,296          28,047
Rehabilitation services.......         60,936         62,764          64,490
Employment services status....          6,893          7,100           7,295
Vocational/educational 
counseling....................         13,978         15,096          15,850
    \1\ Veterans may be in more than one category.

                                WORKLOAD

                                     2005 actual  2006 est.   2007 est.

Original claims...............        211,418        223,455         233,455
Adjustments/supplemental 
claims........................      1,122,663      1,202,524       1,258,996

    This appropriation finances educational assistance allowances for 
certain service persons, veterans and for eligible dependents of those 
veterans: (a) who died from service-connected causes or have a total and 
permanent rated service-connected disability; and (b) servicepersons who 
were captured or missing in action. In addition, certain disabled 
veterans are provided with vocational rehabilitation, specially adapted 
housing grants, and automobile grants with the associated approval 
adaptive equipment. Voluntary contributions by eligible servicepersons 
and matching contributions provided by the Department of Defense are 
included in the Post-Vietnam Era Veterans Education Account.

    All Volunteer Force educational assistance (Montgomery GI Bill).--
Public Law 98-525, enacted October 19, 1984, established two new 
educational programs: an assistance program for veterans who enter 
active duty during the period beginning July 1, 1985; and an assistance 
program for certain members of the Selected Reserve. Public Law 108-375 
established a program to provide educational assistance to members of 
the reserve components called or ordered to active service in response 
to a war or national emergency declared by the President or the 
Congress, in recognition of the sacrifices that those members make in 
answering the call to duty. The Readjustment Benefit appropriation pays 
the basic benefit allowance for veterans, except for certain Post-
Vietnam Era Veterans Education participants who transferred to the 
Montgomery GI Bill program. Supplementary educational assistance, Post-
Vietnam Era Veterans Education converters, reservists, and the National 
Call to Service Program are financed by payments from the Department of 
Defense.

    The following table shows a caseload and cost comparison for these 
beneficiaries under existing legislation.

                     CASELOAD AND AVERAGE COST DATA

                                     2005 actual  2006 est.   2007 est.

Veterans/Servicemembers:
  Number of trainees..........        336,347        370,248         373,368
  Average cost per trainee....         $5,611         $5,789          $5,983
                                    ------------------------------------
      Total cost (in millions)         $1,887         $2,144          $2,234
                                    ====================================
Reservists (1606):
  Number of trainees..........         87,589         81,930          91,579
  Average cost per trainee....         $2,098         $2,172          $2,256
                                    ------------------------------------
      Total cost (in millions)           $186           $180            $209
                                    ====================================
Reservists (1607):
  Number of trainees..........                        40,455          50,755
  Average cost per trainee....                        $3,648          $3,791
                                    ------------------------------------
      Total cost (in millions)                          $148            $192
                                    ====================================

    Dependents' education and training.--This program provides benefits 
to children and spouses of veterans who died of a service-connected 
disability or whose service-connected disability is rated permanent and 
total. In addition, dependents of servicepersons missing in action or 
interned by a hostile foreign government for more than 90 days are also 
eligible. The following table provides a comparison of trainees and 
costs for the Dependents Educational Assistance program.

                       NUMBER OF TRAINEES AND COST

                                     2005 actual  2006 est.   2007 est.

Sons and daughters:
  Number of trainees..........         63,863         68,142          71,412
  Average cost per trainee (in 
    dollars)..................         $5,348         $5,510          $5,726
                                    ------------------------------------
      Total cost (in millions)           $342           $375            $409
                                    ====================================
Spouses and widow(ers):
  Number of trainees..........         10,497         11,289          11,823
  Average cost per trainee (in 
    dollars)..................         $4,497         $4,640          $4,824
                                    ------------------------------------

[[Page 967]]


      Total cost (in millions)            $47            $52             $57
                                    ====================================

    Special Assistance to Disabled Veterans.--Service-disabled veterans 
requiring vocational rehabilitation receive assistane to cover the costs 
of subsistence, tuition, books, supplies, and equipment. In addition to 
monetary benefits, individuals may also receive rehabilitation 
evaluation, planning, and delivery services designed to move the veteran 
into a suitable job.

    Special Assistance to Disabled Veterans.--Certain disabled veterans 
are provided with automobile grants with the associated approved 
adaptive equipment. An allowance, up to a maximum of $11,000 is provided 
to certain service-disabled veterans and servicepersons toward the 
purchase price of an automobile. Adaptive equipment and the maintenance 
and replacement of such equipment is also provided.

    Specially adapted housing grants.--Specially adapted housing grants, 
up to a maximum of $50,000, are provided to certain severely disabled 
veterans. Veterans who suffer service-connected blindness or who have 
lost the use of both upper extremities can receive up to $10,000.

    Tuition Assistance.--Public Law 106-398, enacted October 30, 2000, 
allows the military services to pay up to 100 percent of tuition and 
expenses charged by a school for service members. If a service 
department pays less than 100 percent, a service member eligible for the 
Montgomery GI Bill--Active-duty (MGIB) can elect to receive MGIB 
benefits for all or a portion of the remaining expenses. Public Law 108-
454 established a program that provides availability of education 
benefits for payment for national admissions exams and national exams 
for credit at institutions of higher education.

    Licensing and certification test payments.--Under Public Law 106-
419, veterans and other eligible persons may receive up to $2,000 to pay 
fees required for civilian occupational licensing and certification 
examinations needed to enter, maintain, or advance in employment in a 
vocation or profession--effective March 1, 2001.

    National Call to Service.--The 2003 National Defense Authorization 
Act directs the Department of Defense to offer an active duty enlistment 
option of 15 months plus training time to facilitate interest in 
National Service. Program participants will be given the opportunity to 
select one of the following incentives: a $5,000 enlistment bonus, 
repayment of student loans up to $18,000, or one of two education 
allowances.

                     CASELOAD AND AVERAGE COST DATA

                                     2005 actual  2006 est.   2007 est.

Special assistance to disabled 
    veterans:
  Rehabilitation Evaluation 
    Planning and Service cases         22,940         23,628          24,278
  Number of participants......         69,763         71,801          73,776
  Average cost................         $8,088         $8,474          $8,912
                                    ------------------------------------
      Total cost (in millions)           $564           $608            $657
                                    ====================================
Automobiles or other conveyances:
  Number of Conveyances.......          1,461          1,461           1,461
  Average benefit.............        $10,784        $10,784         $10,784
                                    ------------------------------------
      Obligations (in 
        millions).............            $16            $16             $16
                                    ====================================
Adaptive equipment (including 
    maintenance, repair: and 
    installation for automobiles)
  Number of items.............          8,009          8,009           8,009
  Average benefit.............         $4,714         $5,475          $6,358
                                    ------------------------------------
      Obligations (in 
        millions).............            $38            $44             $51
                                    ====================================
Housing grants:
  Number of housing grants....            668            668             668
  Average cost per grant......        $42,259        $43,293         $43,293
                                    ------------------------------------
      Total cost (in millions)            $28            $29             $29
                                    ====================================
Tuition Assistance:
  Number of trainees..........         23,080         23,080          23,080
  Average cost per trainee....           $840           $866            $899
                                    ------------------------------------
      Total cost (in millions)            $19            $20             $21
                                    ====================================
Education Benefits for Payment for 
    National Admissions Exams:
  Number of trainees..........              0        117,846         119,609
      Total cost (in millions)              0            $14             $14
                                    ====================================
Licensing and Certification:
  Number of payments..........          4,706          4,706           4,706
  Average cost per trainee....           $314           $314            $314
                                    ------------------------------------
      Total cost (in millions)             $1             $1              $1
National Call to Service:
  Number of trainees..........              0            200           1,000
                                    ------------------------------------
      Total cost (in millions)             $0             $1              $3
                                    ====================================

    Work-Study.--Certain veterans, reservists, and dependents pursuing a 
program of rehabilitation, education or training, who are enrolled as a 
full-time student, can work up to 250 hours per semester, receiving the 
Federal ($5.15 on September 1, 1997) or state minimum wage rate, 
whichever is higher.

                                     2005 actual  2006 est.   2007 est.

  Number of contracts.........         18,937         21,365          24,007
                                    ------------------------------------
      Total cost (in millions)            $27            $28             $29
                                    ====================================

    Payments to States.--State approving agencies are reimbursed for the 
costs of inspecting, approving, and supervising programs of education 
and training offered by educational institutions and training 
establishments in which veterans, dependents, and reservists are 
enrolled or are about to enter.

    Reporting fees.--Reporting fees are paid to education and training 
institutions to help defray the costs of certifying education enrollment 
for veterans enrolled in training during a calendar year.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-0137-0-1-702      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
41.0  Direct obligations: Grants, 
        subsidies, and contributions....       2,892       3,274       3,454
99.0  Reimbursable obligations: 
        Reimbursable obligations........         285         433         509
                                           ---------   ---------  ----------
99.9    Total new obligations...........       3,177       3,707       3,963
---------------------------------------------------------------------------

                                

                   Veterans Insurance and Indemnities

    For military and naval insurance, national service life insurance, 
servicemen's indemnities, service-disabled veterans insurance, and 
veterans mortgage life insurance as authorized by title 38, United 
States Code, chapter 19; 70 Stat. 887; 72 Stat. 487, [$45,907,000] 
$49,850,000, to remain available until expended. (Military Construction, 
Military Quality of Life and Veterans Affairs Appropriations Act, 2006.)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-0120-0-1-701      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.01 Payment to NSLI...................           1           1           1
00.10 VMLI death claims.................          11          11          10
00.12 Payment to service-disabled 
        veterans insurance..............          35          36          41
                                           ---------   ---------  ----------
01.00   Total direct expenses...........          47          48          52
                                           ---------   ---------  ----------
10.00   Total new obligations...........          47          48          52
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........           1           1           1
22.00 New budget authority (gross)......          47          48          52
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......          48          49          53
23.95 Total new obligations.............         -47         -48         -52
                                           ---------   ---------  ----------

[[Page 968]]


24.40   Unobligated balance carried 
          forward, end of year..........           1           1           1
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Mandatory:

60.00   Appropriation...................          44          46          50
      Mandatory:

69.00   Spending authority from 
          offsetting collections: 
          Offsetting collections (cash).           3           2           2
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................          47          48          52
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..                      -1          -1
73.10 Total new obligations.............          47          48          52
73.20 Total outlays (gross).............         -48         -48         -52
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..          -1          -1          -1
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.97 Outlays from new mandatory 
        authority.......................          47          48          52
86.98 Outlays from mandatory balances...           1
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........          48          48          52
----------------------------------------------------------------------------

    Offsets:
      Against gross budget authority and outlays:

88.40   Offsetting collections (cash) 
          from: VMLI premiums...........          -3          -2          -2
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................          44          46          50
90.00 Outlays...........................          45          46          50
---------------------------------------------------------------------------

                                WORKLOAD

                                     2005 actual  2006 est.   2007 est.

Policy service actions........        809,000        759,000         716,000
Collections...................      1,957,000      1,777,000       1,597,000
Disability claims.............         33,000         31,000          28,000
Insurance awards..............        511,000        489,000         457,000
    Note.--The Department of Veterans Affairs insurance policy loans are 
not an extension of Federal credit. Credit schedules previously shown 
for this account have been discontinued.

    The Insurance business line administers six life insurance programs, 
including two trust funds, two public enterprise funds, a trust 
revolving fund, and Veteran's Mortgage Life Insurance (VMLI), and 
supervises two additional programs for the benefit of servicepersons, 
veterans, and their beneficiaries through contracts with a commercial 
company. All programs are operated on a commercial basis, to the extent 
possible, consistent with all applicable statutes. The Insurance 
appropriation is the funding mechanism for the following administration 
of the Government life insurance activities: U.S. Government Life 
Insurance Fund (USGLI); National Service Life Insurance (NSLI); Service-
Disabled Veterans Insurance Fund (S-DVI); and Veterans Mortgage Life 
Insurance (VMLI).

    Military and naval insurance.--Payments are made to the USGLI fund 
for certain World War I veterans for extra hazards of military service 
and for claims on war risk insurance issued to servicemen and veterans 
of World War I.

    National service life insurance (NSLI).--Payments are made to the 
NSLI fund for certain World War II veterans for: (a) the extra hazards 
of service; (b) gratuitous insurance granted to certain persons unable 
to apply for national service life insurance; and (c) death claims on 
policies under the waiver of a premium while the insured was on active 
duty.

    Payment to service-disabled veterans insurance fund (S-DVI).--
Payments are made to the S-DVI fund to supplement the premiums and other 
receipts of the fund in amounts necessary to pay claims on insurance 
policies issued to veterans with service-connected disabilities.

    Veterans mortgage life insurance (VMLI).--Payments are made to 
mortgage holders under this program, which provides mortgage protection 
life insurance to veterans who have received a grant for specially 
adapted housing due to severe disabilities. The general decline in the 
number of policies and the amount of insurance in force is expected to 
continue in 2007 as indicated in the following table.

                     POLICIES AND INSURANCE IN FORCE

                                     2005 actual  2006 est.   2007 est.

VMLI policies:
  Number of policies..........          2,514          2,430           2,350
  Amount of insurance (dollars 
    in millions)..............           $166           $165            $164

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-0120-0-1-701      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
42.0  Direct obligations: Insurance 
        claims and indemnities..........          45          46          50
99.0  Reimbursable obligations: 
        Reimbursable obligations........           2           2           2
                                           ---------   ---------  ----------
99.9    Total new obligations...........          47          48          52
---------------------------------------------------------------------------

                                

Public enterprise funds:

                Service-Disabled Veterans Insurance Fund

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-4012-0-3-701      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

    Obligations by program activity:
09.01 Capital investment................          12          13          14
09.02 Death Claims......................          56          66          69
09.03 All Other.........................           7           8           7
                                           ---------   ---------  ----------
10.00   Total new obligations...........          75          87          90
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........           5          11           7
22.00 New budget authority (gross)......          81          83          88
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......          86          94          95
23.95 Total new obligations.............         -75         -87         -90
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........          11           7           5
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Mandatory:

69.00   Spending authority from 
          offsetting collections 
          (gross): Offsetting 
          collections (cash)............          81          83          88
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..           9           9           9
73.10 Total new obligations.............          75          87          90
73.20 Total outlays (gross).............         -75         -87         -89
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..           9           9          10
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.97 Outlays from new mandatory 
        authority.......................          75          82          88
86.98 Outlays from mandatory balances...                       5           1
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........          75          87          89
----------------------------------------------------------------------------

    Offsets:
      Against gross budget authority and outlays:

        Offsetting collections (cash) 
            from:
88.00     Federal sources: Insurance 
            account.....................         -36         -37         -40
88.40     Interest on loans.............          -3          -3          -3
88.40     Insurance premiums earned.....         -31         -32         -34
88.40     Repayments of loans...........         -11         -11         -11
88.40     Other income..................
                                           ---------   ---------  ----------
88.90       Total, offsetting 
              collections (cash)........         -81         -83         -88
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................
90.00 Outlays...........................          -6           4           1
---------------------------------------------------------------------------

    This fund finances the payment of claims on nonparticipating life 
insurance policies issued and currently is open

[[Page 969]]

for new issues to veterans having service-connected disabilities. The 
program provides insurance coverage for service-disabled veterans at 
standard rates.

    Operating costs--
        Death claims.--Represents payments to designated beneficiaries.
        All other.--Represents payments to policyholders who surrender 
    their policies for their cash value and hold endowment policies 
    which have matured.

    Capital investment.--A policyholder may borrow up to 94 percent of 
the value of his policy.

    The trend in the number and amount of policies in force is indicated 
in the following table.

                     POLICIES AND INSURANCE IN FORCE

                                     2005 actual  2006 est.   2007 est.
Number of policies............        175,200        182,192         187,324
Insurance in force (dollars in 
millions).....................         $1,728         $1,810          $1,873

    Financing.--Operations are financed from premiums and other 
receipts. Additional funds are received by transfer from the veterans' 
insurance and indemnities appropriation, instead of direct 
appropriations to this fund.

    Operating results and financial condition.--Since premium and other 
receipts are insufficient to cover operations, the fund continues to 
project liabilities in excess of assets. The deficit is expected to 
reach an estimated $583 million by September 30, 2007.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-4012-0-3-701      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
33.0  Investments and loans.............          12          14          14
42.0  Insurance claims and indemnities..          63          73          76
                                           ---------   ---------  ----------
99.0      Reimbursable obligations......          75          87          90
                                           ---------   ---------  ----------
99.9    Total new obligations...........          75          87          90
---------------------------------------------------------------------------

                                

                    Veterans Reopened Insurance Fund

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-4010-0-3-701      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

    Obligations by program activity:
09.01 Death claims......................          39          41          41
09.02 Dividends.........................          13          11          10
09.03 All other.........................           6           8           6
09.04 Capital investment: policy loans..           3           3           3
                                           ---------   ---------  ----------
10.00   Total new obligations...........          61          63          60
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........         391         371         345
22.00 New budget authority (gross)......          41          37          34
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......         432         408         379
23.95 Total new obligations.............         -61         -63         -60
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........         371         345         319
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Spending authority from offsetting 
          collections:

        Mandatory:
69.00     Offsetting collections (cash).          42          37          34
69.10     Change in uncollected customer 
            payments from Federal 
            sources (unexpired).........          -1
                                           ---------   ---------  ----------
69.90       Spending authority from 
              offsetting collections 
              (total mandatory).........          41          37          34
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..          52          53          53
73.10 Total new obligations.............          61          63          60
73.20 Total outlays (gross).............         -61         -63         -60
74.00 Change in uncollected customer 
        payments from Federal sources 
        (unexpired).....................           1
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..          53          53          53
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.97 Outlays from new mandatory 
        authority.......................          41          37          34
86.98 Outlays from mandatory balances...          20          26          26
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........          61          63          60
----------------------------------------------------------------------------

    Offsets:
      Against gross budget authority and outlays:

        Offsetting collections (cash) 
            from:
88.20     Interest on Federal securities         -28         -25         -23
88.40     Interest on loans.............          -1          -1          -1
88.40     Insurance premiums earned.....          -8          -7          -6
88.40     Repayments of loans...........          -4          -4          -4
                                           ---------   ---------  ----------
88.90       Total, offsetting 
              collections (cash)........         -41         -37         -34
      Against gross budget authority only:

88.95   Change in uncollected customer 
          payments from Federal sources 
          (unexpired)...................           1
88.96   Portion of offsetting 
          collections (cash) credited to 
          expired accounts..............          -1
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................
90.00 Outlays...........................          20          26          26
----------------------------------------------------------------------------

    Memorandum (non-add) entries:
92.01 Total investments, start of year: 
        Federal securities: Par value...         442         422         397
92.02 Total investments, end of year: 
        Federal securities: Par value...         422         397         370
---------------------------------------------------------------------------
    Note.--The Department of Veterans Affairs insurance policy loans are 
not an extension of Federal credit. Credit schedules previously shown 
for this account have been discontinued.

    This fund pays claims and administrative costs on participating life 
insurance policies issued during the period May 1, 1965, through May 2, 
1966, under three life insurance programs: (1) service-disabled standard 
insurance; (2) service-disabled rated insurance; and (3) nonservice 
disabled insur- ance availing disabled World War II and Korean conflict 
veterans an opportunity to acquire life insurance coverage who were no 
longer eligible for other Government insurance.

    Budget program--
        Death claims.--Represents payments to designated beneficiaries.
        Dividends.--Policyholders participate in the distribution of 
    annual dividends.
        All other.--This represents resources for the administrative 
    costs of processing claims and maintaining the accounts, and to 
    those policyholders who: (a) surrender their policies for cash 
    value; (b) hold endowment policies which have matured; and (c) have 
    purchased total disability income coverage and subsequently become 
    disabled.
        Policy loans made.--A policyholder may borrow up to 94 percent 
    of the cash value of his policy at an interest rate adjusted to 
    reflect private sector borrowing costs.
        The following table reflects the decrease in the number of 
    policies and the amount of insurance in force:

                     POLICIES AND INSURANCE IN FORCE

                                     2005 actual  2006 est.   2007 est.
  Number of policies..........         52,881         47,980          43,130
  Insurance in force (dollars 
    in millions)..............           $488           $448            $408

    Financing.--Operations are financed from premiums collected from 
policyholders and interest on investments. Excess earnings of the fund 
are now distributed to the policyholders in the form of an annual 
dividend.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-4010-0-3-701      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
33.0  Investments and loans.............           3           3           3

[[Page 970]]

42.0  Insurance claims and indemnities..          42          47          44
43.0  Interest and dividends............          16          13          13
                                           ---------   ---------  ----------
99.9    Total new obligations...........          61          63          60
---------------------------------------------------------------------------

                                

                Servicemembers' Group Life Insurance Fund

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-4009-0-3-701      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

    Obligations by program activity:
09.01 Premium payments..................         520         810         855
09.02 Payments to carrier...............         105         400
09.03 Payment to GOE....................           1           1           1
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 41.0)...................         626       1,211         856
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........                                 332
22.00 New budget authority (gross)......         626       1,543         856
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......         626       1,543       1,188
23.95 Total new obligations.............        -626      -1,211        -856
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........                     332         332
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Mandatory:

69.00   Spending authority from 
          offsetting collections 
          (gross): Offsetting 
          collections (cash)............         626       1,543         856
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..                                -332
73.10 Total new obligations.............         626       1,211         856
73.20 Total outlays (gross).............        -626      -1,543        -856
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..                    -332        -332
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.97 Outlays from new mandatory 
        authority.......................         626       1,543         856
----------------------------------------------------------------------------

    Offsets:
      Against gross budget authority and outlays:

88.40   Offsetting collections (cash) 
          from: Non-Federal sources: 
          Withholdings from serviceman's 
          pay...........................        -626      -1,543        -856
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................
90.00 Outlays...........................
----------------------------------------------------------------------------

    Memorandum (non-add) entries:
92.01 Total investments, start of year: 
        Federal securities: Par value...
92.02 Total investments, end of year: 
        Federal securities: Par value...
---------------------------------------------------------------------------

    This fund finances the payment of group life insurance premiums to 
private insurance companies under the Servicemembers' Group Life 
Insurance Act of 1965, as amended.

    This includes premiums for the new Traumatic Servicemembers' Group 
Life Insurance (TSGLI) that became effective December 1, 2005. TSGLI 
provides for payment between $25,000 and $100,000 (depending on the type 
of injury) to any member of the uniformed services covered by SGLI who 
sustains a traumatic injury that results in certain serious losses.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-4009-0-3-701      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
41.0  Grants, subsidies, and 
        contributions...................         626       1,211         856
                                           ---------   ---------  ----------
99.0      Reimbursable obligations......         626       1,211         856
---------------------------------------------------------------------------

                                

Credit accounts:

                         Housing Program Account

    For the cost of direct and guaranteed loans, such sums as may be 
necessary to carry out the program, as authorized by subchapters I 
through III of chapter 37 of title 38, United States Code: Provided, 
That such costs, including the cost of modifying such loans, shall be as 
defined in section 502 of the Congressional Budget Act of 1974: Provided 
further, That during fiscal year [2006] 2007, within the resources 
available, not to exceed $500,000 in gross obligations for direct loans 
are authorized for specially adapted housing loans.
    In addition, for administrative expenses to carry out the direct and 
guaranteed loan programs, [$153,575,000, which may be transferred to and 
merged with the appropriation for ``General operating expenses''] 
$153,185,000.

          Native American Veteran Housing Loan Program Account

                      (including transfer of funds)

    For administrative expenses to carry out the direct loan program 
authorized by subchapter V of chapter 37 of title 38, United States 
Code, [$580,000, which may be transferred to and merged with the 
appropriation for ``General operating expenses''] $615,000: Provided, 
That no new loans in excess of $30,000,000 may be made in fiscal year 
[2006] 2007.

  Guaranteed Transitional Housing Loans for Homeless Veterans Program 
                                 Account

    For the administrative expenses to carry out the guaranteed 
transitional housing loan program authorized by subchapter VI of chapter 
37 of title 38, United States Code, not to exceed $750,000 of the 
amounts appropriated by this Act for ``General operating expenses'' and 
``Medical administration'' may be expended. (Military Construction, 
Military Quality of Life and Veterans Affairs Appropriations Act, 2006.)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-1119-0-1-704      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.01 Direct loan subsidy...............           5          29          31
00.02 Guaranteed loan subsidy...........                                  20
00.05 Reestimates of direct loan subsidy       1,067          36
00.06 Interest on reestimates of the 
        direct loan subsidy.............         604           3
00.07 Reestimates of guaranteed loan 
        subsidy.........................         111
00.08 Interest on reestimates of 
        guaranteed loan subsidy.........         107
00.09 Administrative expenses...........         153         154         154
                                           ---------   ---------  ----------
10.00   Total new obligations...........       2,047         222         205
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........          51          46          38
22.00 New budget authority (gross)......       2,042         214         197
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......       2,093         260         235
23.95 Total new obligations.............      -2,047        -222        -205
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........          46          38          30
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................         154         154         154
40.35   Appropriation permanently 
          reduced pursuant to H.R. 2673.          -1
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............         153         154         154
      Mandatory:

60.00   Appropriation...................       1,889          60          43
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................       2,042         214         197
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..                       5          13

[[Page 971]]

73.10 Total new obligations.............       2,047         222         205
73.20 Total outlays (gross).............      -2,042        -214        -197
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..           5          13          21
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................         153         154         154
86.97 Outlays from new mandatory 
        authority.......................       1,889          60          43
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........       2,042         214         197
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................       2,042         214         197
90.00 Outlays...........................       2,042         214         197
---------------------------------------------------------------------------

Summary of Loan Levels, Subsidy Budget Authority and Outlays by Program (in 
                            millions of dollars)

----------------------------------------------------------------------------
Identification code 36-1119-0-1-704      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
    Direct loan levels supportable by subsidy 
                budget authority:
115001Acquired Direct Loans.............          62         217         223
115002Native American Direct Loans......           6           5           5
115003Transitional Housing Direct Loan..           5          11          11
115004Vendee Direct Loans...............          92         151         366
                                           ---------   ---------  ----------
115901Total direct loan levels..........         165         384         605
    Direct loan subsidy (in percent):
132001Acquired Direct Loans.............       -5.12        9.18       10.43
132002Native American Direct Loan.......       -7.75      -13.79      -13.46
132003Transitional Housing Direct Loan..       82.16       79.89       70.74
132004Vendee Direct Loans...............       -5.12       -5.64       -3.46
                                           ---------   ---------  ----------
132901Weighted average subsidy rate.....       -2.57        5.08        2.93
    Direct loan subsidy budget authority:
133001Acquired Direct Loans.............          -4          20          23
133002Native American Direct Loans......                      -1          -1
133003Transitional Housing Direct Loans.           5           9           8
133004Vendee Direct Loans...............          -6          -9         -13
                                           ---------   ---------  ----------
133901Total subsidy budget authority....          -5          19          17
    Direct loan subsidy outlays:
134001Acquired Direct Loans.............          -4          20          23
134002Native American Direct Loans......                      -1          -1
134003Transitional Housing Direct Loan..                       4          11
134004Vendee Direct Loans...............          -6          -9         -13
                                           ---------   ---------  ----------
134901Total subsidy outlays.............         -10          14          20
    Direct loan upward reestimate subsidy budget 
                authority:
135001Acquired Direct Loan..............       1,668          39
135002Native American Direct Loan.......           3
                                           ---------   ---------  ----------
135901Total upward reestimate budget 
        authority.......................       1,671          39
    Direct loan downward reestimate subsidy budget 
                authority:
137001Acquired Direct Loans.............        -200        -112
137002Native American Direct Loan.......          -2          -3
137004Vendee Direct Loans...............
                                           ---------   ---------  ----------
137901Total downward reestimate budget 
        authority.......................        -202        -115
----------------------------------------------------------------------------

    Guaranteed loan levels supportable by subsidy 
                budget authority:
215001Veterans Housing Benefit Program..      22,544      36,110      37,189
215002Guaranteed Loan Sale Securities...                                 492
                                           ---------   ---------  ----------
215901Total loan guarantee levels.......      22,544      36,110      37,681
    Guaranteed loan subsidy (in percent):
232001Veterans Housing Benefit Program..       -0.32       -0.32       -0.36
232002Guaranteed Loan Sale Securities...        0.00        0.00        3.99
                                           ---------   ---------  ----------
232901Weighted average subsidy rate.....       -0.32       -0.32       -0.30
    Guaranteed loan subsidy budget authority:
233001Veterans Housing Benefit Program..         -74        -116        -134
233002Guaranteed Loan Sale Securities...                                  20
                                           ---------   ---------  ----------
233901Total subsidy budget authority....         -74        -116        -114
    Guaranteed loan subsidy outlays:
234001Veterans Housing Benefit Program..         -74        -116        -134
234002Guaranteed Loan Sale Securities...                                  20
                                           ---------   ---------  ----------
234901Total subsidy outlays.............         -74        -116        -114
    Guaranteed loan upward reestimate subsidy 
                budget authority:
235001Guaranteed Loan...................           4
235002Guaranteed Loan Sales.............         214           1
                                           ---------   ---------  ----------
235901Total upward reestimate budget 
        authority.......................         218           1
    Guaranteed loan downward reestimate subsidy 
                budget authority:
237001Veterans Housing Benefit Program..        -787      -1,108
237002Guaranteed Loan Sale Securities...         -31         -68
                                           ---------   ---------  ----------
237901Total downward reestimate subsidy 
        budget authority................        -818      -1,176
----------------------------------------------------------------------------

    Administrative expense data:
351001Budget authority..................         153         154         154
359001Outlays from new authority........         153         154         154
---------------------------------------------------------------------------

    As required by the Federal Credit Reform Act of 1990, this account 
records, for these programs, the subsidy costs associated with the 
direct loans obligated and loan guarantees committed in 1992 and beyond, 
(including modifications of direct loans or loan guarantees that 
resulted from obligations or commitments in any year), as well as for 
the administrative expenses of these programs. The subsidy amounts are 
estimated on a net present value basis.

    Veterans housing benefit program fund program account.--The Federal 
guaranty for this program protects lenders against the following types 
of losses: (a) for loans of $45,000 or less, 50 percent of the loan is 
guaranteed; (b) for loans greater than $45,000, but not more than 
$56,250, $22,500; (c) for loans more than $56,250, but less than 
$144,000, the lesser of $36,000 or 40 percent of the loan; or (d) for 
loans in excess of $144,000 the guarantee will be the lesser of: 25 
percent of the Freddie Mac conforming loan limit for a single family 
residence, as adjusted for the year involved; or 25 percent of the loan; 
or the veteran's available entitlement.

    Native American veterans housing loan program account.--The Native 
American Veterans Housing Loan program provides direct loans to veterans 
living on trust lands under 38 U.S.C. chapter 37, section 3761. These 
loans are available to purchase, construct or improve homes to be 
occupied as the veteran's residence. The principal amount of a loan 
under this authority is generally limited to $80,000, except in areas 
where housing costs are significantly higher than average costs 
nationwide. This is a pilot program that began in 1993 and is authorized 
through December 31, 2008.

    Guaranteed transitional housing loans for homeless veterans program 
account.--Public Law 105-368, the ``Veterans Benefits Improvement Act of 
1998,'' established a pilot project designed to expand the supply of 
transitional housing for homeless veterans and to guarantee up to 15 
investment loans with a maximum aggregate value of $100 million. The 
project must enforce sobriety standards and provide a wide range of 
supportive services such as counseling for substance abuse and job 
readiness skills. Residents will be required to pay a reasonable fee.

    This appropriation provides for the corporate leadership and 
operational support to VA's housing business line.

    The Housing program facilitates the extension of private capital, on 
more liberal terms than generally available to nonveterans, to: assist 
veterans and servicepersons in obtaining housing credits; and assist 
veterans in retaining their homes during periods of temporary economic 
difficulty through intensive supplemental mortgage loan servicing.

                                WORKLOAD

                             [In thousands]

                                     2005 actual  2006 est.   2007 est.

  Construction and valuation..        194,101        219,000         225,000
  Loan processing.............        441,938        502,000         510,000
  Loan service and claims.....        327,055        340,000         357,000

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-1119-0-1-704      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
25.2  Other services....................         153         154         154

[[Page 972]]

41.0  Grants, subsidies, and 
        contributions...................       1,894          68          51
                                           ---------   ---------  ----------
99.9    Total new obligations...........       2,047         222         205
---------------------------------------------------------------------------

                                

                  Housing Direct Loan Financing Account

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-4127-0-3-704      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.01 Direct loans......................         191         368         589
00.02 Interest on Treasury borrowing....         236         105          94
00.03 Property sales expense............           5           6           6
00.04 Property management/other expense.           7           6           6
00.05 Property improvement expense......                       1           1
                                           ---------   ---------  ----------
00.91   Direct Program by Activities--
          Subtotal (1 level)............         439         486         696
08.01 Payment of negative subsidy to 
        receipt account.................          10           9          13
08.02 Payment of downward reestimate to 
        receipt account.................          78          80
08.04 Payment of excess interest earned 
        to receipt account..............         122          33
                                           ---------   ---------  ----------
08.91   Direct Program by Activities--
          Subtotal (1 level)............         210         122          13
                                           ---------   ---------  ----------
10.00   Total new obligations...........         649         608         709
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........         203       1,274
22.00 New financing authority (gross)...       1,922         626         729
22.60 Portion applied to repay debt.....        -202      -1,292         -20
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......       1,923         608         709
23.95 Total new obligations.............        -649        -608        -709
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........       1,274
----------------------------------------------------------------------------

    New financing authority (gross), detail:
      Mandatory:

67.10   Authority to borrow.............       1,758         481         589
      Spending authority from offsetting 
          collections:

        Mandatory:
69.00     Offsetting collections (cash).       2,146         346         895
69.47     Portion applied to repay debt.      -1,982        -201        -755
                                           ---------   ---------  ----------
69.90       Spending authority from 
              offsetting collections 
              (total mandatory).........         164         145         140
                                           ---------   ---------  ----------
70.00   Total new financing authority 
          (gross).......................       1,922         626         729
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..          71          69          54
73.10 Total new obligations.............         649         608         709
73.20 Total financing disbursements 
        (gross).........................        -651        -623        -708
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..          69          54          55
87.00 Total financing disbursements 
        (gross).........................         651         623         708
----------------------------------------------------------------------------

    Offsets:
      Against gross financing authority and 
          financing disbursements:

        Offsetting collections (cash) 
            from:
88.00     Federal sources:Payments from 
            program account.............      -1,668         -20         -23
88.00     Transfer of loan sales from 
            LSSA........................                                -492
88.00     Reimbursements from DLFA......          -5         -51         -82
88.25     Interest on uninvested funds..         -87
88.40     Repayments of principal.......        -247        -118        -130
88.40     Interest received on loans....         -56         -73         -77
88.40     Fees..........................          -2          -3          -7
88.40     Cash sale of properties.......         -81         -77         -80
88.40     Other.........................          -1          -4          -4
                                           ---------   ---------  ----------
88.90       Total, offsetting 
              collections (cash)........      -2,147        -346        -895
      Against gross financing authority only:

88.96   Portion of offsetting 
          collections (cash) credited to 
          expired accounts..............           1
----------------------------------------------------------------------------

    Net financing authority and financing 
        disbursements:
89.00 Financing authority...............        -224         280        -166
90.00 Financing disbursements...........      -1,495         277        -187
---------------------------------------------------------------------------

               Status of Direct Loans (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-4127-0-3-704      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
    Position with respect to appropriations act 
                limitation on obligations:
1111  Limitation on direct loans........
1131  Direct loan obligations exempt 
        from limitation.................         191         368         589
                                           ---------   ---------  ----------
1150    Total direct loan obligations...         191         368         589
----------------------------------------------------------------------------

    Cumulative balance of direct loans 
                outstanding:
1210  Outstanding, start of year........       1,032         934       1,289
1231  Disbursements: Direct loan 
        disbursements...................         154         368         589
      Repayments:

1251    Repayments and prepayments......        -247        -118        -130
1253    Proceeds from loan asset sales 
          to the public with recourse...                                -492
1262  Adjustments: Discount on loan 
        asset sales to the public or 
        discounted......................
      Write-offs for default:

1263    Direct loans....................          -5          -3          -4
1264    Other adjustments, Data 
          Reconciliation................                     108         166
                                           ---------   ---------  ----------
1290    Outstanding, end of year........         934       1,289       1,418
---------------------------------------------------------------------------

    As required by the Federal Credit Reform Act of 1990, this non-
budgetary account records all cash flows to and from the Government 
resulting from direct loans obligated in 1992 and beyond (including 
modifications of direct loans that resulted from obligations in any 
year). The amounts in this account are a means of financing and are not 
included in the budget totals.

                             Balance Sheet (in millions of dollars)

-----------------------------------------------------------------------------------------------
Identification code   36-4127-0-3-704

2004 actual

2005 actual

-----------------------------------------------------------------------------------------------
    ASSETS:
      Federal assets:

1101

Fund balances with Treasury

274

1,344

        Investments in US securities:
1106

Receivables, net

2,208

39

      Net value of assets related to 
          post-1991 direct loans 
          receivable:

1401

Direct loans receivable, gross

1,032

934

1402

Interest receivable

19

22

1405

Other

-680

1





1499

Net present value of assets related to direct loans

371

957





1999

Total assets

2,853

2,340

    LIABILITIES:
      Federal liabilities:

2103

Debt

2,582

2,157

2105

Other

271

183





2999

Total liabilities

2,853

2,340





4999

Total liabilities and net position

2,853

2,340

-----------------------------------------------------------------------------------------------

                                

                Housing Guaranteed Loan Financing Account

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-4129-0-3-704      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.01 Acquisition of homes..............         717       1,806       1,694
00.02 Losses on defaulted loans.........         235         593         556
00.04 Reimburse DLFA for loan sales.....                                 492
00.05 Payment to trustee reserve........           4                      33
00.06 Reimburse Liquidating for 
        subordination certificate.......           7
00.07 Loan Sale Closing Costs...........                                  27
00.09 Property sales expense............          86         131         123
00.10 Property management expense.......          56         115         108
00.11 Property improvement expense......           3          30          29

[[Page 973]]

00.12 Loans acquired....................         101         214         220
                                           ---------   ---------  ----------
00.91   Direct Program by Activities--
          Subtotal (1 level)............       1,209       2,889       3,282
08.01 Payment of negative subsidy to 
        receipt account.................          74         116         134
08.02 Payment of downward reestimate to 
        receipt account.................         573         843
08.04 Payment of excess interest to 
        receipt account.................         246         333
                                           ---------   ---------  ----------
08.91   Direct Program by Activities--
          Subtotal (1 level)............         893       1,292         134
                                           ---------   ---------  ----------
10.00   Total new obligations...........       2,102       4,181       3,416
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........       4,273       4,426       3,475
22.00 New financing authority (gross)...       2,258       3,230       3,847
22.60 Portion applied to repay debt.....          -3
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......       6,528       7,656       7,322
23.95 Total new obligations.............      -2,102      -4,181      -3,416
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........       4,426       3,475       3,906
----------------------------------------------------------------------------

    New financing authority (gross), detail:
      Spending authority from offsetting 
          collections:

        Mandatory:
69.00     Offsetting collections (cash).       2,273       3,230       3,847
69.10     Change in uncollected customer 
            payments from Federal 
            sources (unexpired).........         -15
                                           ---------   ---------  ----------
69.90       Spending authority from 
              offsetting collections 
              (total mandatory).........       2,258       3,230       3,847
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..          22          12          24
73.10 Total new obligations.............       2,102       4,181       3,416
73.20 Total financing disbursements 
        (gross).........................      -2,127      -4,169      -3,422
74.00 Change in uncollected customer 
        payments from Federal sources 
        (unexpired).....................          15
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..          12          24          18
87.00 Total financing disbursements 
        (gross).........................       2,127       4,169       3,422
----------------------------------------------------------------------------

    Offsets:
      Against gross financing authority and 
          financing disbursements:

        Offsetting collections (cash) 
            from:
88.00     Payments from program account.        -218          -1         -20
88.00     Recoveries from DLFA..........        -180        -357        -580
88.25     Interest on uninvested funds..        -239        -223        -204
88.40     Funding fees..................        -409        -610        -619
88.40     Cash sale of properties.......      -1,210      -2,039      -1,913
88.40     Refunds from Trust............                                 -14
88.40     Redemption of properties and 
            other.......................         -15
88.40     Subordinate Certificate 
            Deposits....................
88.45     Loan sale proceeds............          -3                    -497
                                           ---------   ---------  ----------
88.90       Total, offsetting 
              collections (cash)........      -2,274      -3,230      -3,847
      Against gross financing authority only:

88.95   Change in receivables from 
          program accounts..............          15
88.96   Portion of offsetting 
          collections (cash) credited to 
          expired accounts..............           1
----------------------------------------------------------------------------

    Net financing authority and financing 
        disbursements:
89.00 Financing authority...............
90.00 Loan sale proceeds................        -146         939        -425
---------------------------------------------------------------------------

             Status of Guaranteed Loans (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-4129-0-3-704      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
    Position with respect to appropriations act 
                limitation on commitments:
2111  Limitation on guaranteed loans 
        made by private lenders.........                       1
2131  Guaranteed loan commitments exempt 
        from limitation.................      22,544      36,110      37,189
2132  Guaranteed loan commitments for 
        loan asset sales with recourse..                                 492
                                           ---------   ---------  ----------
2150    Total guaranteed loan 
          commitments...................      22,544      36,111      37,681
2199  Guaranteed amount of guaranteed 
        loan commitments................       7,235      11,590      12,428
----------------------------------------------------------------------------

    Cumulative balance of guaranteed loans 
                outstanding:
2210  Outstanding, start of year........     347,251     195,107     196,772
2231  Disbursements of new guaranteed 
        loans...........................      22,544      36,110      37,189
2232  Guarantees of loans sold to the 
        public with recourse............                                 492
2251  Repayments and prepayments........     -28,938     -31,832     -35,015
      Adjustments:

2261    Terminations for default that 
          result in loans receivable....        -235        -593        -556
2262    Terminations for default that 
          result in acquisition of 
          property......................        -717      -1,806      -1,694
2263    Terminations for default that 
          result in claim payments......        -105        -214        -253
2264    Other adjustments, net..........    -144,693
                                           ---------   ---------  ----------
2290    Outstanding, end of year........     195,107     196,772     196,935
----------------------------------------------------------------------------

    Memorandum:
2299  Guaranteed amount of guaranteed 
        loans outstanding, end of year..      66,142      65,827      65,247
---------------------------------------------------------------------------

    Note: Improvements to processes that track VA guaranteed loan 
activity and provide budget formulation data, including the total amount 
of outstanding debt, have revealed a 2005 discrepancy of $145 billion. 
Upgrades to VA's tracking systems will be activated by 2007, minimizing 
the risk of such errors in the future.

    As required by the Federal Credit Reform Act of 1990, this non-
budgetary account records all cash flows to and from the Government 
resulting from loan guarantees committed in 1992 and beyond, including 
modifications of guaranteed loans that resulted from commitments in any 
year, and from the guarantee of loans sold through the securitization 
programs. The amounts in this account are a means of financing and are 
not included in the budget totals.

                             Balance Sheet (in millions of dollars)

-----------------------------------------------------------------------------------------------
Identification code   36-4129-0-3-704

2004 actual

2005 actual

-----------------------------------------------------------------------------------------------
    ASSETS:
      Federal assets:

1101

Fund balances with Treasury

4,276

4,403

        Investments in US securities:
1106

Receivables, net

296

64

      Net value of assets related to 
          post-1991 acquired defaulted 
          guaranteed loans receivable:

1501

Accounts Receivable from Foreclosed Property

1,071

3

1504

Foreclosed property

4

553

1505

Other Assets

19

35





1599

Net present value of assets related to defaulted guaranteed loans

1,094

591





1999

Total assets

5,666

5,058

    LIABILITIES:
      Federal liabilities:

2103

Debt

6

3

2105

Other liabilities

1,158

1,577

      Non-Federal liabilities:

2201

Accounts payable

17

13

2204

Non-federal liabilities for loan guarantees

4,485

3,465





2999

Total liabilities

5,666

5,058





4999

Total liabilities and net position

5,666

5,058

-----------------------------------------------------------------------------------------------

                                

                       Housing Liquidating Account

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-4025-0-3-704      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.01 Acquisition of homes..............          15          12           9
00.04 Acquisition of defaulted 
        guaranteed loans................           6           3           3
00.05 Repurchase of loans sold..........           2           1           1
                                           ---------   ---------  ----------
00.91   Total capital investments.......          23          16          13
                                           ---------   ---------  ----------
01.00   Total capital investments.......          23          16          13
01.02 Property management expense.......           5           4           4
01.03 Sales expense.....................           3           3           3
01.04 Claims processed..................          -7          -6          -6
01.05 Other operating expenses..........           1           1           1
                                           ---------   ---------  ----------
01.91   Total operating expenses........           2           2           2
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 33.0)...................          25          18          15
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........          28          32
22.00 New budget authority (gross)......          57          18          15
22.40 Capital transfer to general fund..         -28         -32
                                           ---------   ---------  ----------

[[Page 974]]


23.90   Total budgetary resources 
          available for obligation......          57          18          15
23.95 Total new obligations.............         -25         -18         -15
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........          32
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Spending authority from offsetting 
          collections:

        Mandatory:
69.00     Offsetting collections (cash).         101          79          64
69.10     Change in uncollected customer 
            payments from Federal 
            sources (unexpired).........           1
69.27     Capital transfer to general 
            fund........................         -45         -61         -49
                                           ---------   ---------  ----------
69.90       Spending authority from 
              offsetting collections 
              (total mandatory).........          57          18          15
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..           2           2
73.10 Total new obligations.............          25          18          15
73.20 Total outlays (gross).............         -24         -20         -15
74.00 Change in uncollected customer 
        payments from Federal sources 
        (unexpired).....................          -1
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..           2
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.97 Outlays from new mandatory 
        authority.......................          22          18          15
86.98 Outlays from mandatory balances...           2           2
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........          24          20          15
----------------------------------------------------------------------------

    Offsets:
      Against gross budget authority and outlays:

        Offsetting collections (cash) 
            from:
88.00     Federal sources: Payments from 
            direct loan financing 
            account.....................         -15         -11          -8
88.40     Loan and other repayments.....         -19         -14         -11
88.40     Sale of homes, cash...........         -45         -34         -27
88.40     Interest on loans.............         -22         -19         -17
88.40     Other revenues................                      -1          -1
                                           ---------   ---------  ----------
88.90       Total, offsetting 
              collections (cash)........        -101         -79         -64
      Against gross budget authority only:

88.95   Change in uncollected customer 
          payments from Federal sources 
          (unexpired)...................          -1
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................         -45         -61         -49
90.00 Outlays...........................         -77         -59         -49
---------------------------------------------------------------------------

               Status of Direct Loans (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-4025-0-3-704      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
    Cumulative balance of direct loans 
                outstanding:
1210  Outstanding, start of year........          79          75          57
1232  Disbursements: Purchase of loans 
        assets from the public..........           2           1           1
1251  Repayments: Repayments and 
        prepayments.....................         -19         -15         -11
      Write-offs for default:

1263    Direct loans....................          -5          -4          -3
1264    Other adjustments, net\1\.......          18
                                           ---------   ---------  ----------
1290    Outstanding, end of year........          75          57          44
---------------------------------------------------------------------------

             Status of Guaranteed Loans (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-4025-0-3-704      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
    Cumulative balance of guaranteed loans 
                outstanding:
2210  Outstanding, start of year........       3,601      10,992       8,094
2251  Repayments and prepayments........        -946      -2,889      -2,127
      Adjustments:

2261    Terminations for default that 
          result in loans receivable....          -4          -3          -3
2262    Terminations for default that 
          result in acquisition of 
          property......................         -15         -12          -9
2264    Other adjustments, net..........       8,356           6           6
                                           ---------   ---------  ----------
2290    Outstanding, end of year........      10,992       8,094       5,961
----------------------------------------------------------------------------

    Memorandum:
2299  Guaranteed amount of guaranteed 
        loans outstanding, end of year..       2,636       1,920       1,392
---------------------------------------------------------------------------

                             Balance Sheet (in millions of dollars)

-----------------------------------------------------------------------------------------------
Identification code   36-4025-0-3-704

2004 actual

2005 actual

-----------------------------------------------------------------------------------------------
    ASSETS:
      Federal assets:

1101

Fund balances with Treasury

28

33

        Investments in US securities:
1106

Receivables, net

5

6

1201

Non-Federal assets: Investments in non-Federal securities, net

186

178

      Net value of assets related to 
          post-1991 direct loans 
          receivable:

1401

Direct loans receivable, gross

84



1402

Interest receivable

4



1405

Other

-2







1499

Net present value of assets related to direct loans

86



      Net value of assets related to 
          pre-1992 direct loans 
          receivable and acquired 
          defaulted guaranteed loans 
          receivable:

1601

Direct loans, gross



74

1602

Interest receivable

66

1





1699

Value of assets related to direct loans

66

75

1703

Allowance for estimated uncollectible loans and interest (-)



-287

1705

Accounts receivable from foreclosed property



287

1706

Foreclosed property



17





1799

Value of assets related to loan guarantees



17





1999

Total assets

371

309

    LIABILITIES:
2103

Federal liabilities: Debt

364

302

2207

Non-Federal liabilities: Other

7

7





2999

Total liabilities

371

309





4999

Total liabilities and net position

371

309

-----------------------------------------------------------------------------------------------

    As required by the Federal Credit Reform Act of 1990, this account 
records all cash flows to and from the Government resulting from direct 
loans obligated and loan guarantees committed prior to 1992. All new 
activity in this program in 1992 and beyond is recorded in the 
corresponding program and financing accounts.

                                

              Native American Direct Loan Financing Account

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-4130-0-3-704      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.01 Direct loans\1\...................           6           5           5
00.03 Interest on Treasury borrowing....           5                       1
                                           ---------   ---------  ----------
00.91   Direct Program by Activities--
          Subtotal......................          11           5           6
08.01 Negative Subsidies Obligated......                       1           1
08.02 Payment of downward reestimate to 
        receipt account.................           2           3
                                           ---------   ---------  ----------
08.91   Direct Program by Activities--
          Subtotal (1 level)............           2           4           1
                                           ---------   ---------  ----------
10.00   Total new obligations...........          13           9           7
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........                       1           2
22.00 New financing authority (gross)...          71          10           8
22.60 Portion applied to repay debt.....         -57
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......          14          11          10
23.95 Total new obligations.............         -13          -9          -7
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........           1           2           3
----------------------------------------------------------------------------

[[Page 975]]



    New financing authority (gross), detail:
      Mandatory:

67.10   Authority to borrow.............          61           7           5
      Discretionary:

68.00   Spending authority from 
          offsetting collections: 
          Offsetting collections (cash).          10           3           3
                                           ---------   ---------  ----------
70.00   Total new financing authority 
          (gross).......................          71          10           8
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..                       2
73.10 Total new obligations.............          13           9           7
73.20 Total financing disbursements 
        (gross).........................         -11         -11          -6
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..           2                       1
87.00 Total outlays (gross).............          11          11           6
----------------------------------------------------------------------------

    Offsets:
      Against gross financing authority and 
          financing disbursements:

        Offsetting collections (cash) 
            from:
88.00     Federal sources: 
            Reimbursements from NADL....          -4
88.25     Interest on uninvested funds..          -3
88.40     Non-federal sources--
            Repayments and prepayments 
            of principal................          -2          -1          -1
88.40     Non-Federal sources--Interest 
            received on loans...........          -1          -2          -2
                                           ---------   ---------  ----------
88.90       Total, offsetting 
              collections (cash)........         -10          -3          -3
----------------------------------------------------------------------------

    Net financing authority and financing 
        disbursements:
89.00 Financing authority...............          61           7           5
90.00 Financing disbursements...........           2           8           3
---------------------------------------------------------------------------

               Status of Direct Loans (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-4130-0-3-704      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
    Position with respect to appropriations act 
                limitation on obligations:
1111  Limitation on direct loans........          50          30          30
1121  Limitation available from carry-
        forward.........................           2
1142  Unobligated direct loan limitation 
        (-).............................         -46         -25         -25
                                           ---------   ---------  ----------
1150    Total direct loan obligations...           6           5           5
----------------------------------------------------------------------------

    Cumulative balance of direct loans 
                outstanding:
1210  Outstanding, start of year........          23          27          31
1231  Disbursements: Direct loan 
        disbursements...................           6           5           5
1251  Repayments: Repayments and 
        prepayments.....................          -2          -1          -1
1264  Write-offs for default: Data 
        Reconciliation..................
                                           ---------   ---------  ----------
1290    Outstanding, end of year........          27          31          35
---------------------------------------------------------------------------

                             Balance Sheet (in millions of dollars)

-----------------------------------------------------------------------------------------------
Identification code   36-4130-0-3-704

2004 actual

2005 actual

-----------------------------------------------------------------------------------------------
    ASSETS:
      Federal assets:

1101

Fund balances with Treasury



2

        Investments in US securities:
1106

Receivables, net

3



      Net value of assets related to 
          post-1991 direct loans 
          receivable:

1401

Direct loans receivable, gross

22

27





1499

Net present value of assets related to direct loans

22

27

1901

Other Federal assets: Other assets

5

3





1999

Total assets

30

32

    LIABILITIES:
      Federal liabilities:

2101

Accounts payable



-3

2103

Federal liabilities debt

28

32

2105

Other liabilities

2

3





2999

Total liabilities

30

32





4999

Total liabilities and net position

30

32

-----------------------------------------------------------------------------------------------

    This account contains information on the Native American Veterans 
Housing Loan program and the Guaranteed Transitional Housing Loans for 
Homeless Veterans program. The Transitional Housing loans are 100% 
guaranteed and use the Federal Financing Bank (FFB) as the lending 
institution. For budget purposes, all FFB loans shall be treated as 
direct loans.

    As required by the Federal Credit Reform Act of 1990, this non-
budgetary account records all cash flows to and from the Government 
resulting from direct loans obligated in 1992 and beyond (including 
modifications of direct loans that resulted from obligations in any 
year). The amounts in the account are means of financing and are not 
included in the budget totals.

                                

           Transitional Housing Direct Loan Financing Account

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-4258-0-3-704      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.01 Guaranteed (Direct) Loans.........                      11          11
                                           ---------   ---------  ----------
10.00   Total new obligations...........                      11          11
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........                       5
22.00 New financing authority (gross)...           6           6          11
22.60 Portion applied to repay debt.....          -1
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......           5          11          11
23.95 Total new obligations.............                     -11         -11
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........           5
----------------------------------------------------------------------------

    New financing authority (gross), detail:
      Mandatory:

67.10   Authority to borrow.............           1           2
      Spending authority from offsetting 
          collections:

        Mandatory:
69.00     Offsetting collections (cash).                       4          11
69.10     Change in uncollected customer 
            payments from Federal 
            sources (unexpired).........           5
                                           ---------   ---------  ----------
69.90       Spending authority from 
              offsetting collections 
              (total mandatory).........           5           4          11
                                           ---------   ---------  ----------
70.00   Total new financing authority 
          (gross).......................           6           6          11
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..                      -5           6
73.10 Total new obligations.............                      11          11
74.00 Change in uncollected customer 
        payments from Federal sources 
        (unexpired).....................          -5
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..          -5           6          17
----------------------------------------------------------------------------

    Offsets:
      Against gross financing authority and 
          financing disbursements:

88.00   Offsetting collections (cash) 
          from: Federal sources.........                      -4         -11
      Against gross financing authority only:

88.95   Change in receivables from 
          program accounts..............          -5
----------------------------------------------------------------------------

    Net financing authority and financing 
        disbursements:
89.00 Financing authority...............           1           2
90.00 Financing disbursements...........                      -4         -11
---------------------------------------------------------------------------

               Status of Direct Loans (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-4258-0-3-704      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
    Position with respect to appropriations act 
                limitation on obligations:
1111  Limitation on direct loans........
1121  Limitation available from carry-
        forward.........................         100          95          89
1143  Unobligated limitation carried 
        forward (P.L. xx) (-)...........         -95         -89         -78
                                           ---------   ---------  ----------
1150    Total direct loan obligations...           5           6          11
----------------------------------------------------------------------------

    Cumulative balance of direct loans 
                outstanding:
1210  Outstanding, start of year........                                   5
1231  Disbursements: Direct loan 
        disbursements...................                       5          15
1251  Repayments: Repayments and 
        prepayments.....................
                                           ---------   ---------  ----------
1290    Outstanding, end of year........                       5          20
---------------------------------------------------------------------------

[[Page 976]]



                                

         Vocational Rehabilitation Direct Loan Financing Account

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-4259-0-3-702      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.01 Direct loans......................           3           3           4
                                           ---------   ---------  ----------
10.00   Total new obligations...........           3           3           4
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........           1
22.00 New financing authority (gross)...           3           3           4
22.60 Portion applied to repay debt.....          -1
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......           3           3           4
23.95 Total new obligations.............          -3          -3          -4
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........
----------------------------------------------------------------------------

    New financing authority (gross), detail:
      Mandatory:

67.10   Authority to borrow (indefinite)           3           3           4
      Spending authority from offsetting 
          collections:

        Discretionary:
68.00     Offsetting collections (cash).           3           3           3
68.47     Portion applied to repay debt.          -3          -3          -3
                                           ---------   ---------  ----------
68.90       Spending authority from 
              offsetting collections 
              (total discretionary).....
                                           ---------   ---------  ----------
70.00   Total new financing authority 
          (gross).......................           3           3           4
----------------------------------------------------------------------------

    Change in obligated balances:
73.10 Total new obligations.............           3           3           4
73.20 Total financing disbursements 
        (gross).........................          -3          -3          -4
87.00 Total financing disbursements 
        (gross).........................           3           3           4
----------------------------------------------------------------------------

    Offsets:
      Against gross financing authority and 
          financing disbursements:

88.40   Offsetting collections (cash) 
          from: Repayments and 
          prepayments of principal......          -3          -3          -3
----------------------------------------------------------------------------

    Net financing authority and financing 
        disbursements:
89.00 Financing authority...............                                   1
90.00 Financing disbursements...........                                   1
---------------------------------------------------------------------------

               Status of Direct Loans (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-4259-0-3-702      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
    Position with respect to appropriations act 
                limitation on obligations:
1111  Limitation on direct loans........           3           3           4
                                           ---------   ---------  ----------
1150    Total direct loan obligations...           3           3           4
----------------------------------------------------------------------------

    Cumulative balance of direct loans 
                outstanding:
1210  Outstanding, start of year........           1           1           1
1231  Disbursements: Direct loan 
        disbursements...................           3           3           3
1251  Repayments: Repayments and 
        prepayments (-).................          -3          -3          -3
                                           ---------   ---------  ----------
1290    Outstanding, end of year........           1           1           1
---------------------------------------------------------------------------

                             Balance Sheet (in millions of dollars)

-----------------------------------------------------------------------------------------------
Identification code   36-4259-0-3-702

2004 actual

2005 actual

-----------------------------------------------------------------------------------------------
    ASSETS:
      Investments in US securities:

1106

Federal assets: Fund assets: Fund Balance with Treasury



1

      Net value of assets related to 
          post-1991 direct loans 
          receivable:

1401

Direct loans receivable, gross



1





1499

Net present value of assets related to direct loans



1





1999

Total assets



2

    LIABILITIES:
2103

Federal liabilities: Debt



2





2999

Total liabilities



2





4999

Total liabilities and net position



2

-----------------------------------------------------------------------------------------------

                                

  

                               Trust Funds

               Post-Vietnam Era Veterans Education Account

          Special and Trust Fund Receipts (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-8133-0-7-702      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
01.00 Balance, start of year............           1           1           1
                                           ---------   ---------  ----------
01.99 Balance, start of year............           1           1           1
    Receipts:
02.00 Contributions, Post-Vietnam era 
        veterans education account......                       1           1
02.20 Deductions from military pay, 
        Post-Vietnam era veterans 
        education account...............           1
                                           ---------   ---------  ----------
02.99   Total receipts and collections..           1           1           1
                                           ---------   ---------  ----------
04.00 Total: Balances and collections...           2           2           2
    Appropriations:
05.00 Post-Vietnam era veterans 
        education account...............          -1          -1          -1
                                           ---------   ---------  ----------
07.99 Balance, end of year..............           1           1           1
---------------------------------------------------------------------------

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-8133-0-7-702      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.01 Payment to post-Vietnam era 
        trainees........................           1           1           1
00.03 Participant disenrollments........           2           2           1
                                           ---------   ---------  ----------
10.00   Total new obligations...........           3           3           2
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........          73          71          69
22.00 New budget authority (gross)......           1           1           1
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......          74          72          70
23.95 Total new obligations.............          -3          -3          -2
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........          71          69          68
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Mandatory:

60.26   Appropriation (trust fund)......           1           1           1
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..           1           1           1
73.10 Total new obligations.............           3           3           2
73.20 Total outlays (gross).............          -3          -3          -2
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..           1           1           1
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.97 Outlays from new mandatory 
        authority.......................           1           1           1
86.98 Outlays from mandatory balances...           2           2           1
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........           3           3           2
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................           1           1           1
90.00 Outlays...........................           3           3           2
---------------------------------------------------------------------------

    This account consists of voluntary contributions by eligible 
servicepersons and matching contributions provided by the Department of 
Defense. The fund provides educational assistance payments to 
participants who entered the service after December 31, 1976, and are 
pursuing training under chapter 32, title 38, U.S.C. Section 901 is a 
non-contributory program with educational assistance provided by the 
Department of Defense. Public Law 99-576, enacted October 28, 1986, 
closed the program permanently for new enrollments effective March 31, 
1987. Public Law 106-419, enacted November 1, 2000, provides qualified 
participants in this program another opportunity (through October 31, 
2001) to convert to the All-Volun

[[Page 977]]

teer Force Educational Assistance program (Montgomery GI Bill). The 
estimated activity in the fund follows:

    CONTRIBUTIONS, PARTICIPANTS, DISENROLLMENTS, REFUNDS AND TRAINEES

                        [In millions of dollars]

                                     2005 actual  2006 est.   2007 est.

Total budget authority........             $1             $1              $1
  Servicepersons contributions             $1             $0              $0
  Transferred from Department 
    of Defense (bonus)........             $0             $0              $0
  Transferred from Department 
    of Defense (matching).....             $0             $1              $1
  Transferred from Department 
    of Defense (section 901)..             $0             $0              $0
Total participants (end of 
year).........................        195,715        193,897         192,301
Total contributors (end of 
year).........................            264            232             204
Average contribution per 
contributor (actual dollars)..         $1,175         $1,175          $1,175
Number of disenrollments......          1,600          1,400           1,200
Total refunds.................             $1             $2              $1
Total trainees................            723            650             600
Total trainee cost............             $1             $1              $1
Average cost per trainee 
(actual dollars)..............         $1,571         $1,420          $1,487
Section 901 trainees..........             35             28              27

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-8133-0-7-702      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
41.0  Grants, subsidies, and 
        contributions...................           1           1           1
44.0  Refunds...........................           2           2           1
                                           ---------   ---------  ----------
99.9    Total new obligations...........           3           3           2
---------------------------------------------------------------------------

                                

                  National Service Life Insurance Fund

          Special and Trust Fund Receipts (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-8132-0-7-701      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
01.00 Balance, start of year............       9,492       9,134       8,727
    Adjustments:
01.90 Adjustments.......................          -1
                                           ---------   ---------  ----------
01.99 Balance, start of year............       9,491       9,134       8,727
    Receipts:
02.00 NSLI fund, Interest...............         682         632         587
02.01 NSLI fund, Payments from general 
        and special funds...............           1           1           1
02.20 NSLI fund, Premium and other 
        receipts........................         171         162         146
                                           ---------   ---------  ----------
02.99   Total receipts and collections..         854         795         734
                                           ---------   ---------  ----------
04.00 Total: Balances and collections...      10,345       9,929       9,461
    Appropriations:
05.00 National service life insurance 
        fund............................        -855        -795        -734
05.01 National service life insurance 
        fund............................        -356        -407        -455
                                           ---------   ---------  ----------
05.99   Total appropriations............      -1,211      -1,202      -1,189
                                           ---------   ---------  ----------
07.99 Balance, end of year..............       9,134       8,727       8,272
---------------------------------------------------------------------------

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-8132-0-7-701      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.01 Death claims......................         677         684         690
00.02 Disability claims.................          10           9           8
00.03 Matured endowments................           8          11          13
00.04 Cash surrenders...................          31          29          29
00.05 Dividends.........................         269         235         207
00.06 Interest paid on dividend credits 
        and deposits....................          55          54          50
00.07 Payment to Insurance account......          22          23          24
                                           ---------   ---------  ----------
00.91   Total operating expenses........       1,072       1,045       1,021
02.01 Capital investment: Policy loans..          61          61          59
                                           ---------   ---------  ----------
02.93   Total direct obligations........       1,133       1,106       1,080
09.01 Death claims......................         243         261         264
09.02 Disability Claims.................           4           4           3
09.03 Matured Endowments................           3           4           5
09.04 Cash Surrenders...................          11          11          11
09.05 Dividends.........................          97          90          79
09.06 Interest paid on dividend credits 
        and deposits....................          19          20          19
09.07 Payment to Insurance account......           8           9           9
                                           ---------   ---------  ----------
09.09   Reimbursable program............         385         399         390
                                           ---------   ---------  ----------
10.00   Total new obligations...........       1,518       1,505       1,470
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
22.00 New budget authority (gross)......       1,518       1,505       1,470
23.95 Total new obligations.............      -1,518      -1,505      -1,470
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Mandatory:

60.26   Appropriation (trust fund)......         855         795         734
60.28   Appropriation (previously 
          unavailable)..................         356         407         455
                                           ---------   ---------  ----------
62.50     Appropriation (total 
            mandatory)..................       1,211       1,202       1,189
      Mandatory:

69.00   Spending authority from 
          offsetting collections: 
          Offsetting collections (cash).         307         303         281
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................       1,518       1,505       1,470
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..       1,468       1,472       1,456
73.10 Total new obligations.............       1,518       1,505       1,470
73.20 Total outlays (gross).............      -1,514      -1,521      -1,498
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..       1,472       1,456       1,428
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.97 Outlays from new mandatory 
        authority.......................       1,514       1,098       1,014
86.98 Outlays from mandatory balances...                     423         484
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........       1,514       1,521       1,498
----------------------------------------------------------------------------

    Offsets:
      Against gross budget authority and outlays:

        Offsetting collections (cash) 
            from:
88.40     Repayments of loans...........         -98         -94         -88
88.40     Optional settlements..........          -2          -2          -2
88.40     Net income offsets adjustments        -207        -207        -191
                                           ---------   ---------  ----------
88.90       Total, offsetting 
              collections (cash)........        -307        -303        -281
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................       1,211       1,202       1,189
90.00 Outlays...........................       1,207       1,218       1,217
----------------------------------------------------------------------------

    Memorandum (non-add) entries:
92.01 Total investments, start of year: 
        Federal securities: Par value...      10,949      10,597      10,174
92.02 Total investments, end of year: 
        Federal securities: Par value...      10,597      10,174       9,690
---------------------------------------------------------------------------
    Note.--The Department of Veterans Affairs insurance policy loans are 
not an extension of Federal credit. Credit schedules previously shown 
for this account have been discontinued.

    This fund was established in 1940. It is for the World War II 
servicemen's and veterans' insurance program. Over 22 million policies 
were issued under this program. Activity of the fund reflects a 
declining claim workload. The trend in the number and amount of policies 
in force is shown as follows:

                     POLICIES AND INSURANCE IN FORCE

                                     2004 actual  2005 est.   2006 est.

Number of policies............      1,202,065      1,102,190       1,003,065
Insurance in force (dollars in 
millions).....................        $13,198        $12,256         $11,345

    This fund is operated on a commercial basis to the extent possible. 
The income of the fund is derived from premium receipts, interest on 
investments, and payments which are made to the fund from the Veterans 
insurance and indemnities appropriation.

    Assets of the fund, which are largely invested in special interest-
bearing Treasury securities and in policy loans, are expected to 
decrease from $10,761 million as of September 30, 2006 to $10,208 
million as of September 30, 2007. The actuarial estimate of policy 
obligations as of September 30, 2007, totals $9,958 million, leaving a 
balance of $250 million for contingency reserves.

    The status of the fund, excluding noncash transactions, is as 
follows:

[[Page 978]]

                  Status of Funds (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-8132-0-7-701      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
    Unexpended balance, start of year:
0100  Balance, start of year............      10,961      10,606      10,183
      Adjustments:

0190    Adjustments.....................          -2
                                           ---------   ---------  ----------
0199    Total balance, start of year....      10,959      10,606      10,183
    Cash income during the year:
      Current law:

        Receipts:
1200      NSLI fund, Interest...........         682         632         587
1201      NSLI fund, Payments from 
            general and special funds...           1           1           1
        Offsetting receipts 
            (proprietary):
1220      NSLI fund, Premium and other 
            receipts....................         171         162         146
        Offsetting collections:
1280      National service life 
            insurance fund..............          98          94          88
1281      National service life 
            insurance fund..............         207         207         191
1282      National service life 
            insurance fund..............           2           2           2
1299    Income under present law........       1,161       1,098       1,015
                                           ---------   ---------  ----------
3299    Total cash income...............       1,161       1,098       1,015
    Cash outgo during year:
      Current law:

4500    National service life insurance 
          fund..........................      -1,514      -1,521      -1,498
4599    Outgo under current law (-).....      -1,514      -1,521      -1,498
                                           ---------   ---------  ----------
6599    Total cash outgo (-)............      -1,514      -1,521      -1,498
    Unexpended balance, end of year:
8700  Uninvested balance (net), end of 
        year............................           9           9          10
8701  National service life insurance 
        fund............................      10,597      10,174       9,690
                                           ---------   ---------  ----------
8799    Total balance, end of year......      10,606      10,183       9,700
    Commitments against unexpended balance, end of 
                year:
                                           ---------   ---------  ----------
9900    Uncommitted balance, end of year      10,606      10,183       9,700
---------------------------------------------------------------------------

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-8132-0-7-701      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

      Direct obligations:

33.0    Investments and loans...........          61          61          59
42.0    Insurance claims and indemnities         726         733         740
43.0    Interest and dividends..........         346         312         281
                                           ---------   ---------  ----------
99.0      Direct obligations............       1,133       1,106       1,080
99.0  Reimbursable obligations..........         385         399         390
                                           ---------   ---------  ----------
99.9    Total new obligations...........       1,518       1,505       1,470
---------------------------------------------------------------------------

                                

              United States Government Life Insurance Fund

          Special and Trust Fund Receipts (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-8150-0-7-701      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
01.00 Balance, start of year............          34          29          25
                                           ---------   ---------  ----------
01.99 Balance, start of year............          34          29          25
    Receipts:
02.00 Interest and profits on 
        investments in public debt 
        securities, USGLI...............           3           3           2
                                           ---------   ---------  ----------
04.00 Total: Balances and collections...          37          32          27
    Appropriations:
05.00 United States Government life 
        insurance fund..................          -3          -3          -2
05.01 United States Government life 
        insurance fund..................          -5          -4          -4
                                           ---------   ---------  ----------
05.99   Total appropriations............          -8          -7          -6
                                           ---------   ---------  ----------
07.99 Balance, end of year..............          29          25          21
---------------------------------------------------------------------------

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-8150-0-7-701      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.01 Death claims......................           4           4           4
00.06 Interest paid on dividend credits 
        and deposits....................           1           1
09.01 Death Claims......................           1           1           1
09.02 Dividends.........................           2           1           1
                                           ---------   ---------  ----------
09.09   Reimbursable program............           3           2           2
                                           ---------   ---------  ----------
10.00   Total new obligations...........           8           7           6
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
22.00 New budget authority (gross)......           8           7           6
23.95 Total new obligations.............          -8          -7          -6
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Mandatory:

60.26   Appropriation (trust fund)......           3           3           2
60.28   Appropriation (previously 
          unavailable)..................           5           4           4
                                           ---------   ---------  ----------
62.50     Appropriation (total 
            mandatory)..................           8           7           6
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..          16          15          13
73.10 Total new obligations.............           8           7           6
73.20 Total outlays (gross).............          -9          -9          -8
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..          15          13          11
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.97 Outlays from new mandatory 
        authority.......................           3           3           2
86.98 Outlays from mandatory balances...           6           6           6
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........           9           9           8
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................           8           7           6
90.00 Outlays...........................           9           9           8
----------------------------------------------------------------------------

    Memorandum (non-add) entries:
92.01 Total investments, start of year: 
        Federal securities: Par value...          50          45          44
92.02 Total investments, end of year: 
        Federal securities: Par value...          45          44          44
---------------------------------------------------------------------------
    Note.--The Department of Veterans Affairs insurance policy loans are 
not an extension of Federal credit. Credit schedules previously shown 
for this account have been discontinued.

    This fund was established in 1919 to receive premiums and pay claims 
on insurance issued under the provisions of the War Risk Insurance Act. 
The general decline in the activity of the fund is indicated in the 
following table:

                     POLICIES AND INSURANCE IN FORCE

                                     2005 actual  2006 est.   2007 est.
Number of policies............          9,034          7,750           6,560
Insurance in force (dollars in 
millions).....................            $28            $24             $20

    The fund is operated on a commercial basis to the extent possible. 
The income of the fund is derived from interest on investments and 
payments from the Veterans insurance and indemnities appropriation. 
Effective January 1, 1983, premiums were discontinued because reserves 
held in the fund were adequate to meet future liabilities of the 
program.

    Assets of the fund, which are largely invested in interest-bearing 
securities and policy loans, are estimated to decrease from $41 million 
as of September 30, 2006, to $35 million as of September 30, 2007, as an 
increasing number of policies mature through death or disability. The 
actuarial evaluation of policy obligations as of September 30, 2007, 
totals $34 million, leaving a balance of $1 million for contingency 
reserves.

    The status of the fund, excluding noncash transactions, is as 
follows:

                  Status of Funds (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-8150-0-7-701      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
    Unexpended balance, start of year:
0100  Balance, start of year............          50          44          38
                                           ---------   ---------  ----------
0199    Total balance, start of year....          50          44          38

[[Page 979]]

    Cash income during the year:
      Current law:

        Receipts:
1200      Interest and profits on 
            investments in public debt 
            securities, USGLI...........           3           3           2
1299    Income under present law........           3           3           2
                                           ---------   ---------  ----------
3299    Total cash income...............           3           3           2
    Cash outgo during year:
      Current law:

4500    United States Government life 
          insurance fund................          -9          -9          -8
4599    Outgo under current law (-).....          -9          -9          -8
                                           ---------   ---------  ----------
6599    Total cash outgo (-)............          -9          -9          -8
    Unexpended balance, end of year:
8700  Uninvested balance (net), end of 
        year............................          -1          -6         -12
8701  United States Government life 
        insurance fund..................          45          44          44
                                           ---------   ---------  ----------
8799    Total balance, end of year......          44          38          32
---------------------------------------------------------------------------

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-8150-0-7-701      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

      Direct obligations:

42.0    Insurance claims and indemnities           4           2           1
43.0    Interest and dividends..........           1           2           2
                                           ---------   ---------  ----------
99.0      Direct obligations............           5           4           3
99.0  Reimbursable obligations..........           3           3           3
                                           ---------   ---------  ----------
99.9    Total new obligations...........           8           7           6
---------------------------------------------------------------------------

                                

                  Veterans Special Life Insurance Fund

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-8455-0-8-701      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

    Obligations by program activity:
09.01 Death claims......................          68          82          86
09.02 Cash surrenders...................           4           5           4
09.03 Dividends.........................          81          80          77
09.04 All other.........................          28          32          31
09.05 Payments to Insurance account.....           6           6           6
09.06 Capital investment................          14          14          14
                                           ---------   ---------  ----------
10.00   Total new obligations...........         201         219         218
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........       1,556       1,577       1,574
22.00 New budget authority (gross)......         222         216         210
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......       1,778       1,793       1,784
23.95 Total new obligations.............        -201        -219        -218
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........       1,577       1,574       1,566
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Mandatory:

69.00   Spending authority from 
          offsetting collections 
          (gross): Offsetting 
          collections (cash)............         222         216         210
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..         333         352         372
73.10 Total new obligations.............         201         219         218
73.20 Total outlays (gross).............        -182        -199        -200
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..         352         372         390
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.97 Outlays from new mandatory 
        authority.......................         182         199         200
----------------------------------------------------------------------------

    Offsets:
      Against gross budget authority and outlays:

        Offsetting collections (cash) 
            from:
88.20     Interest on Federal securities        -140        -136        -133
88.40     Interest on loans.............          -5          -5          -5
88.40     Insurance premiums earned.....         -61         -59         -57
88.40     Repayments of loans...........         -16         -16         -15
                                           ---------   ---------  ----------
88.90       Total, offsetting 
              collections (cash)........        -222        -216        -210
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................
90.00 Outlays...........................         -40         -17         -10
----------------------------------------------------------------------------

    Memorandum (non-add) entries:
92.01 Total investments, start of year: 
        Federal securities: Par value...       1,888       1,928       1,945
92.02 Total investments, end of year: 
        Federal securities: Par value...       1,928       1,945       1,955
---------------------------------------------------------------------------
    Note.--The Department of Veterans Affairs insurance policy loans are 
not an extension of Federal credit. Credit schedules previously shown 
for this account have been discontinued.

    This fund finances the payment of claims on life insurance policies 
issued before January 3, 1957, to veterans who served in the Armed 
Forces subsequent to April 1, 1951. No new policies can be issued. 
Policyholders may elect to purchase total disability income coverage 
with the payment of additional premiums.

    Budget program--
        Death claims.--Represents payments to designated beneficiaries.
        Cash surrenders.--A policyholder may terminate his or her 
    insurance by cashing in the policy for its cash value.
        Dividends.--Policyholders participate in the distribution of 
    annual dividends.
        All other.--Classified in this category are payments to 
    policyholders who: (a) hold endowment policies which have matured; 
    (b) have purchased total disability income coverage and subsequently 
    become disabled; and (c) are paid interest on dividend credits and 
    deposits.
        The following table reflects the decrease in the number of 
    policies and the amounts of insurance in force:

                     POLICIES AND INSURANCE IN FORCE

                                     2005 actual  2006 est.   2007 est.
Number of policies............        206,501        198,490         189,940
Insurance in force (dollars in 
millions).....................         $2,490         $2,431          $2,370

    Financing.--Payments from this fund are financed primarily  from  
premium  receipts  and  interest  on investments.

    Operating results and financial condition.--Lower than expected 
death rates on insurance written against this fund has kept death claim 
payments well below the amount of premium and interest receipts, thereby 
producing an annual increase in the total revenue of the fund. Excess 
earnings of the fund are now distributed to the policyholders in the 
form of an annual dividend. 

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-8455-0-8-701      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
33.0  Investments and loans.............          14          14          14
42.0  Insurance claims and indemnities..          83          99         103
43.0  Interest and dividends............         104         106         101
                                           ---------   ---------  ----------
99.9    Total new obligations...........         201         219         218
---------------------------------------------------------------------------

                                


 
                       DEPARTMENTAL ADMINISTRATION

                      Construction, Major Projects

    For constructing, altering, extending and improving any of the 
facilities including parking projects under the jurisdiction or for the 
use of the Department of Veterans Affairs, or for any of the purposes 
set forth in sections 316, 2404, 2406, 8102, 8103, 8106, 8108, 8109, 
8110, and 8122 of title 38, United States Code, including planning, 
architectural and engineering services, construction management 
services, maintenance or guarantee period services costs associated with 
equipment guarantees provided under the project, services of claims 
analysts, offsite utility and storm drainage system construction costs, 
and site acquisition, where the estimated cost of a project is more than 
the amount set forth in section 8104(a)(3)(A) of title 38, United States 
Code, or where funds for a project were made available in a previous 
major project appropriation, [$607,100,000] $399,000,000, to remain 
available until expended, [of which $532,010,000 shall be for Capital 
Asset Realignment for Enhanced

[[Page 980]]

Services (CARES) activities; and] of which [$2,500,000] $2,000,000 shall 
be to make reimbursements as provided in section 13 of the Contract 
Disputes Act of 1978 (41 U.S.C. 612) for claims paid for contract 
disputes: Provided, That except for advance planning activities, 
including needs assessments which may or may not lead to capital 
investments, and other capital asset management related activities, such 
as portfolio development and management activities, and investment 
strategy studies funded through the advance planning fund and the 
planning and design activities funded through the design fund and CARES 
funds, including needs assessments which may or may not lead to capital 
investments, none of the funds appropriated under this heading shall be 
used for any project which has not been approved by the Congress in the 
budgetary process: Provided further, That funds provided in this 
appropriation for fiscal year [2006] 2007, for each approved project 
(except those for CARES activities referenced above) shall be obligated: 
(1) by the awarding of a construction documents contract by September 
30, [2006] 2007; and (2) by the awarding of a construction contract by 
September 30, [2007] 2008: Provided further, That the Secretary of 
Veterans Affairs shall promptly report in writing to the Committees on 
Appropriations of both Houses of Congress any approved major 
construction project in which obligations are not incurred within the 
time limitations established above[: Provided further, That none of the 
funds in this or any other Act may be used to reduce the mission, 
services or infrastructure, including land, of the 18 facilities on the 
Capital Asset Realignment for Enhanced Services (CARES) list requiring 
further study as specified by the Secretary of Veterans Affairs without 
prior approval of the Committees on Appropriations of both Houses of 
Congress]. (Military Construction, Military Quality of Life and Veterans 
Affairs Appropriations Act, 2006.)
    [For an additional amount for ``Construction, Major Projects'', 
$367,500,000, to remain available until expended, for necessary expenses 
related to the consequences of hurricanes in the Gulf of Mexico in 
calendar year 2005: Provided, That the amount provided under this 
heading is designated as an emergency requirement pursuant to section 
402 of H. Con. Res. 95 (109th Congress), the concurrent resolution on 
the budget for fiscal year 2006.]

          Special and Trust Fund Receipts (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-0110-0-1-703      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
    Receipts:
02.20 Enhanced-use lease proceeds, MCCF.                      22
    Appropriations:
05.00 Construction, major projects......                     -22
                                           ---------   ---------  ----------
07.99 Balance, end of year..............
---------------------------------------------------------------------------

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-0110-0-1-703      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.01 Medical Programs..................         389         350         578
00.02 National Cemeteries...............          31          79          93
00.04 Staff Offices.....................           2           2           6
00.05 Regional Offices..................           1
                                           ---------   ---------  ----------
10.00   Total new obligations...........         423         431         677
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........         937         996       1,563
22.00 New budget authority (gross)......         482         998         400
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......       1,419       1,994       1,963
23.95 Total new obligations.............        -423        -431        -677
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........         996       1,563       1,286
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................         459         607         399
40.20   Appropriation (special fund)....                      22
40.30   Appropriations adjusted pursuant 
          to PL 109-148 Hurricane 
          Supplemental..................                     368
40.35   Appropriation permanently 
          reduced.......................          -4
42.00   Transferred from other accounts.          26
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............         481         997         399
      Discretionary:

68.00   Spending authority from 
          offsetting collections: 
          Offsetting collections (cash).           1           1           1
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................         482         998         400
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..         201         478         491
73.10 Total new obligations.............         423         431         677
73.20 Total outlays (gross).............        -146        -418        -520
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..         478         491         648
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................           1           8           3
86.93 Outlays from discretionary 
        balances........................         145         410         517
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........         146         418         520
----------------------------------------------------------------------------

    Offsets:
      Against gross budget authority and outlays:

88.00   Offsetting collections (cash) 
          from: Federal sources.........          -1          -1          -1
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................         481         997         399
90.00 Outlays...........................         145         417         519
---------------------------------------------------------------------------

    Major
        The ``Construction, major projects'' appropriations, fund 
    construction projects costing more than $7 million, and support new 
    cemeteries in the vicinity of Bakersfield, CA; Birmingham, AL; 
    Columbia/Greenville, SC; Jacksonville, FL; Sarasota County, FL; and 
    Southeastern, PA; cemetery improvements and expansions in Dallas/Ft. 
    Worth, TX; Gerald B.H. Solomon Saratoga, NY; Great Lakes, MI; 
    Abraham Lincoln, IL; and Quantico, VA; fund facility improvements, 
    realignments, and support seismic corrections as related to CARES in 
    Milwaukee, WI; St. Louis, MO; Columbia, MO; Denver, CO; Long Beach, 
    CA.; and American Lakes, WA.
        Additional funds are provided to abate asbestos and other 
    hazardous materials from Department-owned buildings, reimburse the 
    Judgment Fund, improve facility security at Department-owned 
    buildings, and support advance planning and design activities.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-0110-0-1-703      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

      Direct obligations:

11.3    Personnel compensation: Other 
          than full-time permanent......           1           1           1
25.2    Other services..................           4           4           4
26.0    Supplies and materials..........           1           1           1
31.0    Equipment.......................           1           1           1
32.0    Land and structures.............         415         423         669
                                           ---------   ---------  ----------
99.0      Direct obligations............         422         430         676
99.0  Reimbursable obligations..........           1           1           1
                                           ---------   ---------  ----------
99.9    Total new obligations...........         423         431         677
---------------------------------------------------------------------------

                              Personnel Summary

----------------------------------------------------------------------------
Identification code 36-0110-0-1-703      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
    Direct:
1001  Civilian full-time equivalent 
        employment......................           6           6           6
---------------------------------------------------------------------------

                                

                      Construction, Minor Projects

    For constructing, altering, extending, and improving any of the 
facilities including parking projects under the jurisdiction or for the 
use of the Department of Veterans Affairs, including planning and 
assessments of needs which may lead to capital investments, 
architectural and engineering services, maintenance or guarantee period 
services costs associated with equipment guarantees provided under the

[[Page 981]]

project, services of claims analysts, offsite utility and storm drainage 
system construction costs, and site acquisition, or for any of the 
purposes set forth in sections 316, 2404, 2406, 8102, 8103, 8106, 8108, 
8109, 8110, 8122, and 8162 of title 38, United States Code, where the 
estimated cost of a project is equal to or less than the amount set 
forth in section 8104(a)(3)(A) of title 38, United States Code, 
[$198,937,000] $198,000,000, to remain available until expended, along 
with unobligated balances of previous ``Construction, minor projects'' 
appropriations which are hereby made available for any project where the 
estimated cost is equal to or less than the amount set forth in such 
section, [of which $155,000,000 shall be for Capital Asset Realignment 
for Enhanced Services (CARES) activities: Provided, That funds in this 
account shall be available] for: (1) repairs to any of the nonmedical 
facilities under the jurisdiction or for the use of the Department which 
are necessary because of loss or damage caused by any natural disaster 
or catastrophe; and (2) temporary measures necessary to prevent or to 
minimize further loss by such causes. (Military Construction, Military 
Quality of Life and Veterans Affairs Appropriations Act, 2006.)
    [For an additional amount for ``Construction, Minor Projects,'' 
$1,800,000, to remain available until expended, for necessary expenses 
related to the consequences of hurricanes in the Gulf of Mexico in 
calendar year 2005: Provided, That the amount provided under this 
heading is designated as an emergency requirement pursuant to section 
402 of H. Con. Res. 95 (109th Congress), the concurrent resolution on 
the budget for fiscal year 2006.]

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-0111-0-1-703      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.01 Medical programs..................         260         165         145
00.02 National Cemeteries...............          36          36          25
00.03 Staff Offices.....................           1           6           9
00.04 Regional Offices..................           1          17          10
                                           ---------   ---------  ----------
10.00   Total new obligations...........         298         224         189
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........         114          61          38
22.00 New budget authority (gross)......         245         201         198
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......         359         262         236
23.95 Total new obligations.............        -298        -224        -189
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........          61          38          47
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................         267         199         198
40.30   Appropriations adjusted pursuant 
          to PL 109-148 Hurricane 
          Supplemental..................                       2
40.35   Appropriation permanently 
          reduced.......................          -2
41.00   Transferred to other accounts...         -20
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............         245         201         198
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..         322         403         395
73.10 Total new obligations.............         298         224         189
73.20 Total outlays (gross).............        -217        -232        -211
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..         403         395         373
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................                      36          36
86.93 Outlays from discretionary 
        balances........................         217         196         175
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........         217         232         211
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................         245         201         198
90.00 Outlays...........................         217         232         211
---------------------------------------------------------------------------

    Minor
        The ``Construction minor projects'' appropriation, which funds 
    construction projects costing less than $7 million with a minor 
    improvement component costing $500,000 or more is used to improve 
    the infrastructure of medical facilities and other Department owned 
    facilities to reduce the risk to patient life and safety, correct 
    code deficiencies, improve national cemeteries and regional and 
    staff offices.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-0111-0-1-703      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
11.3  Personnel compensation: Other than 
        full-time permanent.............           3           3           3
25.2  Other services....................          27          27          27
26.0  Supplies and materials............           1           1           1
31.0  Equipment.........................           1           1           1
32.0  Land and structures...............         266         192         157
                                           ---------   ---------  ----------
99.9    Total new obligations...........         298         224         189
---------------------------------------------------------------------------

                              Personnel Summary

----------------------------------------------------------------------------
Identification code 36-0111-0-1-703      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
    Direct:
1001  Civilian full-time equivalent 
        employment......................          50          56          56
---------------------------------------------------------------------------

                                

        Grants for Construction of State Extended Care Facilities

    For grants to assist States to acquire or construct State nursing 
home and domiciliary facilities and to remodel, modify or alter existing 
hospital, nursing home and domiciliary facilities in State homes, for 
furnishing care to veterans as authorized by sections 8131-8137 of title 
38, United States Code, $85,000,000, to remain available until expended. 
(Military Construction, Military Quality of Life and Veterans Affairs 
Appropriations Act, 2006.)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-0181-0-1-703      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.01 Direct program activity...........         123          85          85
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 41.0)...................         123          85          85
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........          22           3           3
22.00 New budget authority (gross)......         104          85          85
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......         126          88          88
23.95 Total new obligations.............        -123         -85         -85
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........           3           3           3
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................         105          85          85
40.35   Appropriation permanently 
          reduced.......................          -1
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............         104          85          85
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..         261         287         280
73.10 Total new obligations.............         123          85          85
73.20 Total outlays (gross).............         -97         -92         -94
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..         287         280         271
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................          97           2           2
86.93 Outlays from discretionary 
        balances........................                      90          92
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........          97          92          94
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................         104          85          85
90.00 Outlays...........................          97          92          94
---------------------------------------------------------------------------

                                

          Grants for Construction of State Veterans Cemeteries

    For grants to aid States in establishing, expanding, or improving 
State veterans cemeteries as authorized by section 2408 of title 38, 
United States Code, $32,000,000, to remain available until expended.

[[Page 982]]

(Military Construction, Military Quality of Life and Veterans Affairs 
Appropriations Act, 2006.)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-0183-0-1-705      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.01 Grants to States..................          36          32          32
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 41.0)...................          36          32          32
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........           4
22.00 New budget authority (gross)......          32          32          32
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......          36          32          32
23.95 Total new obligations.............         -36         -32         -32
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................          32          32          32
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..          31          46          55
73.10 Total new obligations.............          36          32          32
73.20 Total outlays (gross).............         -21         -23         -27
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..          46          55          60
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................          21          17          17
86.93 Outlays from discretionary 
        balances........................                       6          10
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........          21          23          27
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................          32          32          32
90.00 Outlays...........................          21          23          27
---------------------------------------------------------------------------

                                

                       General Operating Expenses

    For necessary operating expenses of the Department of Veterans 
Affairs, not otherwise provided for, including administrative expenses 
in support of Department-Wide capital planning, management and policy 
activities, uniforms or allowances therefor; not to exceed $25,000 for 
official reception and representation expenses; hire of passenger motor 
vehicles; and reimbursement of the General Services Administration for 
security guard services, and the Department of Defense for the cost of 
overseas employee mail, [$1,410,520,000] $1,480,764,000: Provided, That 
expenses for services and assistance authorized under paragraphs (1), 
(2), (5), and (11) of section 3104(a) of title 38, United States Code, 
that the Secretary of Veterans Affairs determines are necessary to 
enable entitled veterans: (1) to the maximum extent feasible, to become 
employable and to obtain and maintain suitable employment; or (2) to 
achieve maximum independence in daily living, shall be charged to this 
account: Provided further, That the Veterans Benefits Administration 
shall be funded at not less than [$1,053,938,000] $1,167,859,000: 
Provided further, That of the funds made available under this heading, 
not to exceed $75,000,000 shall be available for obligation until 
September 30, [2007] 2008: Provided further, That from the funds made 
available under this heading, the Veterans Benefits Administration may 
purchase up to two passenger motor vehicles for use in operations of 
that Administration in Manila, Philippines.

             Vocational Rehabilitation Loans Program Account

                      (including transfer of funds)

    For the cost of direct loans, $53,000, as authorized by chapter 31 
of title 38, United States Code: Provided, That such costs, including 
the cost of modifying such loans, shall be as defined in section 502 of 
the Congressional Budget Act of 1974: Provided further, That funds made 
available under this heading are available to subsidize gross 
obligations for the principal amount of direct loans not to exceed 
$4,242,000.
    In addition, for administrative expenses necessary to carry out the 
direct loan program, $305,000, which may be transferred to and merged 
with the appropriation for ``General operating expenses''. (Military 
Construction, Military Quality of Life and Veterans Affairs 
Appropriations Act, 2006.)
    [For an additional amount for ``General Operating Expenses'', 
$24,871,000, for necessary expenses related to the consequences of 
hurricanes in the Gulf of Mexico in calendar year 2005: Provided, That 
the amount provided under this heading is designated as an emergency 
requirement pursuant to section 402 of H. Con. Res. 95 (109th Congress), 
the concurrent resolution on the budget for fiscal year 2006.]

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-0151-0-1-705      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.01 Compensation and pensions.........         922         916         924
00.02 Education.........................          83          86          90
00.03 Vocational rehabilitation and 
        counseling......................         133         139         149
00.04 Insurance.........................           4           4           4
00.06 General administration............         285         317         313
                                           ---------   ---------  ----------
01.00   Direct Program by Activities--
          Subtotal (running)............       1,427       1,462       1,480
09.01 Compensation and pensions.........          79          95          99
09.02 Education.........................           1           2           2
09.04 Insurance.........................          39          38          40
09.05 Housing...........................         149         131         127
09.06 General administration............         263          86          80
                                           ---------   ---------  ----------
09.99   Total reimbursable program......         531         352         348
                                           ---------   ---------  ----------
10.00   Total new obligations...........       1,958       1,814       1,828
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........          70          87
22.00 New budget authority (gross)......       1,971       1,727       1,835
22.30 Expired unobligated balance 
        transfer to unexpired account...          11
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......       2,052       1,814       1,835
23.95 Total new obligations.............      -1,958      -1,814      -1,828
23.98 Unobligated balance expiring or 
        withdrawn.......................          -7
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........          87                       7
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................       1,326       1,411       1,481
40.30   Appropriations adjusted pursuant 
          to PL 109-148 (Hurricane 
          Supplemental).................                      25
40.35   Appropriation permanently 
          reduced pursuant to P.L. 108-
          447...........................         -11
41.00   Transferred to other accounts...                     -61
42.00   Transferred from other accounts.         125
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............       1,440       1,375       1,481
      Spending authority from offsetting 
          collections:

        Discretionary:
68.00     Offsetting collections (cash).         530         352         354
68.10     Change in uncollected customer 
            payments from Federal 
            sources (unexpired).........           1
                                           ---------   ---------  ----------
68.90       Spending authority from 
              offsetting collections 
              (total discretionary).....         531         352         354
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................       1,971       1,727       1,835
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..         308         432         521
73.10 Total new obligations.............       1,958       1,814       1,828
73.20 Total outlays (gross).............      -1,815      -1,725      -1,769
73.40 Adjustments in expired accounts 
        (net)...........................         -18
74.00 Change in uncollected customer 
        payments from Federal sources 
        (unexpired).....................          -1
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..         432         521         580
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................       1,536       1,456       1,544
86.93 Outlays from discretionary 
        balances........................         279         269         225
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........       1,815       1,725       1,769
----------------------------------------------------------------------------

[[Page 983]]



    Offsets:
      Against gross budget authority and outlays:

88.00   Offsetting collections (cash) 
          from: Federal sources.........        -531        -352        -354
      Against gross budget authority only:

88.95   Change in uncollected customer 
          payments from Federal sources 
          (unexpired)...................          -1
88.96   Portion of offsetting 
          collections (cash) credited to 
          expired accounts..............           1
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................       1,440       1,375       1,481
90.00 Outlays...........................       1,285       1,373       1,415
---------------------------------------------------------------------------
    \1\ The total cost of administering veterans insurance programs is 
funded through direct appropriations to this account and through 
reimbursements from the insurance trust fund.

Summary of Loan Levels, Subsidy Budget Authority and Outlays by Program (in 
                            millions of dollars)

----------------------------------------------------------------------------
Identification code 36-0151-0-1-705      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
    Direct loan levels supportable by subsidy 
                budget authority:
115001Vocational Rehabilitation.........           3           3           4
                                           ---------   ---------  ----------
115901Total direct loan levels..........           3           3           4
    Direct loan subsidy (in percent):
132001Subsidy rate......................        1.14        1.59        2.00
                                           ---------   ---------  ----------
132901Weighted average subsidy rate.....        0.00        0.00        0.00
    Direct loan subsidy budget authority:
133001Subsidy budget authority..........
                                           ---------   ---------  ----------
133901Total subsidy budget authority....
    Direct loan subsidy outlays:
134001Subsidy outlays...................
                                           ---------   ---------  ----------
134901Total subsidy outlays.............
---------------------------------------------------------------------------

    This appropriation provides for the Department's top management 
direction and administrative support, including fiscal, personnel, and 
legal services.

    General Administration.--Includes Departmental executive direction, 
Departmental Support offices, the General Counsel, the Board of Veterans 
Appeals, and the Board of Contract Appeals.

    Funding for non-personal services Information Technology is included 
in VA's Central IT fund beginning FY2006.

    The Pershing Hall Revolving Fund was created to operate and manage 
Pershing Hall, an asset of the United States, located in Paris, France. 
All operating expenses for Pershing Hall are borne by the revolving fund 
and all receipts generated by the operation of Pershing Hall are 
deposited in the revolving fund.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-0151-0-1-705      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

      Direct obligations:

        Personnel compensation:
11.1      Full-time permanent...........         703         783         807
11.5      Other personnel compensation..         135         153         158
                                           ---------   ---------  ----------
11.9        Total personnel compensation         838         936         965
12.1    Civilian personnel benefits.....         216         249         255
21.0    Travel and transportation of 
          persons.......................          10          13          13
22.0    Transportation of things........           2           4           4
23.1    Rent............................         101         119         123
23.3    Communications, utilities, and 
          miscellaneous charges.........          31          40          41
24.0    Printing and reproduction.......           3           4           4
25.2    Other services..................         188          84          61
26.0    Supplies and materials..........          15           9           9
31.0    Equipment.......................          23           4           5
                                           ---------   ---------  ----------
99.0      Direct obligations............       1,427       1,462       1,480
99.0  Reimbursable obligations..........         531         352         348
                                           ---------   ---------  ----------
99.9    Total new obligations...........       1,958       1,814       1,828
---------------------------------------------------------------------------

                              Personnel Summary

----------------------------------------------------------------------------
Identification code 36-0151-0-1-705      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
    Direct:
1001  Civilian full-time equivalent 
        employment\1\...................      12,824      13,466      13,646
    Reimbursable:
2001  Civilian full-time equivalent 
        employment......................       2,258       2,221       2,239
---------------------------------------------------------------------------
    \1\ Reflects FTE treated as reimbursements in all years and the 
effects of Credit Reform, per P.L. 101-508.

                                

                       Office of Inspector General

    For necessary expenses of the Office of Inspector General in 
carrying out the provisions of the Inspector General Act of 1978, 
[$70,174,000, to] $69,499,000, of which $3,474,950 shall remain 
available until September 30, [2007] 2008. (Military Construction, 
Military Quality of Life and Veterans Affairs Appropriations Act, 2006.)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-0170-0-1-705      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

    Obligations by program activity:
01.01 Direct program....................          67          72          70
                                           ---------   ---------  ----------
01.92   Total direct program............          67          72          70
09.01 Reimbursable program..............           3           3           3
                                           ---------   ---------  ----------
10.00   Total new obligations...........          70          75          73
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........           2           3
22.00 New budget authority (gross)......          72          72          73
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......          74          75          73
23.95 Total new obligations.............         -70         -75         -73
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........           3
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................          70          70          70
40.35   Appropriation permanently 
          reduced.......................          -1
41.00   Transferred to other accounts...                      -1
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............          69          69          70
      Discretionary:

68.00   Spending authority from 
          offsetting collections: 
          Offsetting collections (cash).           3           3           3
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................          72          72          73
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..          13          16          21
73.10 Total new obligations.............          70          75          73
73.20 Total outlays (gross).............         -67         -70         -71
73.40 Adjustments in expired accounts 
        (net)...........................          -1
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..          16          21          23
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................          56          60          61
86.93 Outlays from discretionary 
        balances........................          11          10          10
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........          67          70          71
----------------------------------------------------------------------------

    Offsets:
      Against gross budget authority and outlays:

88.00   Offsetting collections (cash) 
          from: Federal sources.........          -3          -3          -3
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................          69          69          70
90.00 Outlays...........................          64          67          68
---------------------------------------------------------------------------

    This appropriation provides Department-wide audit, investigation, 
and health care inspection and support functions to identify and report 
weaknesses and deficiencies in VA programs and operations that create 
conditions for existing or potential instances of criminal activity, 
fraud, waste, and mismanagement. The audit function plans and conducts 
internal programmatic audits of all facets of VA operations. The inves

[[Page 984]]

tigative function conducts criminal and administrative investigations of 
improper and illegal activities involving VA programs, personnel, 
beneficiaries, and other third parties. The health care inspection 
function performs legislatively mandated medical care quality assurance 
reviews and oversight.

    Funding for the Inspector General's non-personal services 
Information Technology (IT) program is provided through VA's Central IT 
fund beginning FY 2006.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-0170-0-1-705      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

      Direct obligations:

11.1    Personnel compensation: Full-
          time permanent................          41          47          45
12.1    Civilian personnel benefits.....          12          14          13
21.0    Employee Travel.................           3           3           3
23.1    Rental payments to GSA..........           3           3           4
23.3    Communications, utilities, and 
          miscellaneous charges.........           1           1           1
25.2    Other services..................           5           3           3
26.0    Supplies and materials..........           1           1           1
31.0    Equipment.......................           1
                                           ---------   ---------  ----------
99.0      Direct obligations............          67          72          70
99.0  Reimbursable obligations..........           3           3           3
                                           ---------   ---------  ----------
99.9    Total new obligations...........          70          75          73
---------------------------------------------------------------------------

                              Personnel Summary

----------------------------------------------------------------------------
Identification code 36-0170-0-1-705      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
    Direct:
1001  Civilian full-time equivalent 
        employment......................         429         485         458
    Reimbursable:
2001  Civilian full-time equivalent 
        employment......................          25          25          25
---------------------------------------------------------------------------

                                

                     Information Technology Systems

    For necessary expenses for information technology systems and 
telecommunications support, including developmental information systems 
and operational information systems; for the capital asset acquisition 
of information technology systems, including management and related 
contractual costs of said acquisitions, including contractual costs 
associated with operations authorized by chapter 3109 of title 5, United 
States Code, [$1,213,820,000] $1,257,000,000, to remain available until 
September 30, [2007] 2008: Provided, That none of these funds may be 
obligated until the Department of Veterans Affairs submits to the 
Committees on Appropriations of both Houses of Congress[, and such 
Committees approve,] a plan for expenditure that: (1) meets the capital 
planning and investment control review requirements established by the 
Office of Management and Budget; (2) complies with the Department of 
Veterans Affairs enterprise architecture; (3) conforms with an 
established enterprise life cycle methodology; and (4) complies with the 
acquisition rules, requirements, guidelines, and systems acquisition 
management practices of the Federal Government: Provided further, That 
within [30] 60 days of enactment of this Act, the Secretary of Veterans 
Affairs shall submit to the Committees on Appropriations of both Houses 
of Congress a reprogramming base letter which provides, by project, the 
costs included in this appropriation. (Military Construction, Military 
Quality of Life and Veterans Affairs Appropriations Act, 2006.)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-0167-0-1-705      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.01 Veterans Health Administration....                     810         832
00.02 Veterans Benefits Administration..                      60          55
00.03 National Cemetery Administration..                       4           4
00.04 General administration and other..                     340         366
                                           ---------   ---------  ----------
01.00   Direct Program by Activities--
          Subtotal......................                   1,214       1,257
09.01 Credit administration.............                      19          22
09.02 Insurance administration..........                       3           4
09.03 Education administration..........                       5
                                           ---------   ---------  ----------
09.09   Reimbursable program--Subtotal..                      27          26
                                           ---------   ---------  ----------
10.00   Total new obligations...........                   1,241       1,283
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
22.00 New budget authority (gross)......                   1,241       1,283
23.95 Total new obligations.............                  -1,241      -1,283
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................                   1,214       1,257
      Discretionary:

68.00   Spending authority from 
          offsetting collections: 
          Offsetting collections (cash).                      27          26
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................                   1,241       1,283
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..                                 496
73.10 Total new obligations.............                   1,241       1,283
73.20 Total outlays (gross).............                    -745      -1,205
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..                     496         574
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................                     745         771
86.93 Outlays from discretionary 
        balances........................                                 434
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........                     745       1,205
----------------------------------------------------------------------------

    Offsets:
      Against gross budget authority and outlays:

88.00   Offsetting collections (cash) 
          from: Federal sources.........                     -27         -26
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................                   1,214       1,257
90.00 Outlays...........................                     718       1,179
---------------------------------------------------------------------------

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-0167-0-1-705      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

      Direct obligations:

23.1    Rental payments to GSA..........                      20          21
23.3    Communications, utilities, and 
          miscellaneous charges.........                      50          52
25.2    Other services..................                     400         414
25.3    Other purchases of goods and 
          services from Government 
          accounts......................                     240         249
31.0    Equipment.......................                     504         521
                                           ---------   ---------  ----------
99.0      Direct obligations............                   1,214       1,257
99.0  Reimbursable obligations..........                      27          26
                                           ---------   ---------  ----------
99.9    Total new obligations...........                   1,241       1,283
---------------------------------------------------------------------------

                                

                    National Cemetery Administration

    For necessary expenses of the National Cemetery Administration for 
operations and maintenance, not otherwise provided for, including 
uniforms or allowances therefor; cemeterial expenses as authorized by 
law; purchase of one passenger motor vehicle for use in cemeterial 
operations; and hire of passenger motor vehicles, [$156,447,000: 
Provided, That of the funds made available under this heading,] 
$160,733,000, of which not to exceed [$7,800,000] $8,037,000 shall be 
available until September 30, [2007] 2008. (Military Construction, 
Military Quality of Life and Veterans Affairs Appropriations Act, 2006.)
    [For an additional amount for ``National Cemetery Administration'', 
$200,000, for necessary expenses related to the consequences of 
hurricanes in the Gulf of Mexico in calendar year 2005: Provided, That 
the amount provided under this heading is designated as an emergency 
requirement pursuant to section 402 of H. Con. Res. 95 (109th Congress), 
the concurrent resolution on the budget for fiscal year 2006.]

[[Page 985]]

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-0129-0-1-705      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

    Obligations by program activity:
02.01 Administrative expenses...........         147         153         161
                                           ---------   ---------  ----------
10.00   Total new obligations...........         147         153         161
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........           1           2
22.00 New budget authority (gross)......         148         149         161
22.30 Expired unobligated balance 
        transfer to unexpired account...           2           2
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......         151         153         161
23.95 Total new obligations.............        -147        -153        -161
23.98 Unobligated balance expiring or 
        withdrawn.......................          -2
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........           2
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................         149         156         161
40.35   Appropriation permanently 
          reduced pursuant to P.L. 108-
          447...........................          -1
41.00   Transferred to other accounts...                      -7
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............         148         149         161
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..          33          30          37
73.10 Total new obligations.............         147         153         161
73.20 Total outlays (gross).............        -147        -146        -156
73.40 Adjustments in expired accounts 
        (net)...........................          -3
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..          30          37          42
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................         123         120         129
86.93 Outlays from discretionary 
        balances........................          24          26          27
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........         147         146         156
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................         148         149         161
90.00 Outlays...........................         147         146         156
---------------------------------------------------------------------------

    The mission of the National Cemetery Administration is to honor 
veterans with final resting places in national shrines and with lasting 
tributes that commemorate their service to our Nation. The National 
Cemetery Administration's vision is to serve all veterans and their 
families with the utmost dignity, respect, and compassion. Every 
national cemetery will be a place that inspires visitors to understand 
and appreciate the service and sacrifice of our Nation's veterans. There 
are four related programs managed by the National Cemetery 
Administration including: (1) burying eligible veterans and their family 
members in national cemeteries and maintaining the graves and their 
environs as national shrines; (2) administering grants to States in 
establishing, expanding, or improving State veteran cemeteries; (3) 
providing headstones and markers for the graves of eligible veterans in 
national, State, and private cemeteries; and (4) providing presidential 
memorial certificates to family and friends of deceased veterans, 
recognizing the veterans' contribution and service to the Nation.

    The National Cemetery Administration also reflects budget 
information for the National Cemetery Gift Fund and the National 
Cemetery Administration Facilities Operation Fund. Through the Gift 
Fund, the Secretary is authorized to accept gifts and bequests which are 
made for the purpose of beautifying national cemeteries or are 
determined to be beneficial to such cemeteries, or are made for the 
purpose of the operation, maintenance, or improvement of the National 
Memorial Cemetery of Arizona. Through the Facilities Operation Fund, the 
Secretary is authorized to lease any undeveloped land and unused or 
underutilized buildings of the National Cemetery Administration, or 
parts or parcels thereof, for a term not to exceed 10 years. Proceeds 
from such leases are deposited in the Facilities Operation Fund, and are 
available to cover costs incurred by the National Cemetery 
Administration in the operation and maintenance of property of the 
Administration.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-0129-0-1-705      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

      Personnel compensation:

11.1    Full-time permanent.............          70          73          76
11.3    Other than full-time permanent..           4           4           4
                                           ---------   ---------  ----------
11.9      Total personnel compensation..          74          77          80
12.1  Civilian personnel benefits.......          23          24          26
21.0  Travel and transportation of 
        persons.........................           2           3           3
22.0  Transportation of things..........           1           1           1
23.1  Rent..............................           1           1           1
23.3  Communications, utilities, and 
        miscellaneous charges...........           5           4           4
24.0  Printing and reproduction.........           1           1           1
25.2  Other services....................          26          29          33
26.0  Supplies and materials............           7           7           7
31.0  Equipment.........................           6           6           5
32.0  Land and structures...............           1
                                           ---------   ---------  ----------
99.9    Total new obligations...........         147         153         161
---------------------------------------------------------------------------

                              Personnel Summary

----------------------------------------------------------------------------
Identification code 36-0129-0-1-705      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
    Direct:
1001  Civilian full-time equivalent 
        employment......................       1,523       1,566       1,589
---------------------------------------------------------------------------

                                

                               Supply Fund

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-4537-0-4-705      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

    Obligations by program activity:
09.01 Reimbursable program-COGS-
        Merchandizing...................       1,744       2,092       2,588
09.02 Reimbursable program-Other-
        Operations......................          82          89          91
09.03 Reimbursable program-COGS-Printing 
        and Publications................           8          10          12
09.04 Reimbursable program-Other........           2           1           1
09.05 Reimbursable program-Equipment-
        Procurement Services and 
        Distribution....................           3           1           1
                                           ---------   ---------  ----------
10.00   Total new obligations...........       1,839       2,193       2,693
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........         278         658         658
22.00 New budget authority (gross)......       2,219       2,193       2,693
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......       2,497       2,851       3,351
23.95 Total new obligations.............      -1,839      -2,193      -2,693
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........         658         658         658
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Spending authority from offsetting 
          collections:

        Mandatory:
69.00     Offsetting collections (cash).       1,737       2,193       2,693
69.10     Change in uncollected customer 
            payments from Federal 
            sources (unexpired).........         482
                                           ---------   ---------  ----------
69.90       Spending authority from 
              offsetting collections 
              (total mandatory).........       2,219       2,193       2,693
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..         643         -95         -95
73.10 Total new obligations.............       1,839       2,193       2,693
73.20 Total outlays (gross).............      -2,095      -2,193      -2,693
74.00 Change in uncollected customer 
        payments from Federal sources 
        (unexpired).....................        -482
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..         -95         -95         -95
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.97 Outlays from new mandatory 
        authority.......................       2,095       2,193       2,693
----------------------------------------------------------------------------

[[Page 986]]



    Offsets:
      Against gross budget authority and outlays:

        Offsetting collections (cash) 
            from:
88.00     Federal sources...............      -1,688      -2,193      -2,693
88.40     Non-Federal sources...........         -49
                                           ---------   ---------  ----------
88.90       Total, offsetting 
              collections (cash)........      -1,737      -2,193      -2,693
      Against gross budget authority only:

88.95   Change in uncollected customer 
          payments from Federal sources 
          (unexpired)...................        -482
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................
90.00 Outlays...........................         358
---------------------------------------------------------------------------

    Under the provisions of 38 U.S.C. 8121, the Supply Fund is 
responsible for the operation and maintenance of a supply system for VA. 
The Supply Fund is an intragovernmental revolving fund without fiscal 
year limitations.

    Budget program.--The fund provides financial support for: (1) a 
National Acquisition Center or central contracting office; (2) the 
maintenance of field station inventories; (3) a service and distribution 
center; (4) a service and reclamation program; (5) a national 
prosthetics distribution center; and (6) an asset management service.

    Costs for the administration of supply activities at VA field 
stations are not financed by the Supply Fund. These costs are charged 
directly to applicable appropriations accounts.

    Financing.--Costs of supplies, equipment, and services acquired 
through the Supply Fund and Supply Fund operating costs are recovered 
through reimbursements from the VA appropriations and other Government 
agencies receiving goods and services. For 2007, Supply Fund sales are 
estimated to reach $2.4 billion.

    Operating results.--The Fund operated at a loss of $3.0 million in 
2005. The new total of retained earnings is $93 million. Operating 
expense as related to sales was 5 percent.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-4537-0-4-705      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

      Personnel compensation:

11.1    Full-time permanent.............          30          36          37
11.5    Other personnel compensation....           1           1           1
                                           ---------   ---------  ----------
11.9      Total personnel compensation..          31          37          38
12.1  Civilian personnel benefits.......           7           9           7
21.0  Travel and transportation of 
        persons.........................           4           6           6
22.0  Transportation of things..........           5          10          10
23.1  Rental payments to GSA............           2           3           2
23.3  Communications, utilities, and 
        miscellaneous charges...........           2           1           2
24.0  Printing and reproduction.........           8           8           9
25.1  Advisory and assistance services..         831       1,082       1,421
26.0  Supplies and materials............         708         701         744
31.0  Equipment.........................         241         336         454
                                           ---------   ---------  ----------
99.9    Total new obligations...........       1,839       2,193       2,693
---------------------------------------------------------------------------

                              Personnel Summary

----------------------------------------------------------------------------
Identification code 36-4537-0-4-705      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
    Reimbursable:
2001  Civilian full-time equivalent 
        employment......................         413         469         473
---------------------------------------------------------------------------

                                

                             Franchise Fund

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-4539-0-4-705      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------

    Obligations by program activity:
09.01 Reimbursable program..............         259         393         427
                                           ---------   ---------  ----------
10.00   Total new obligations...........         259         393         427
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........          76          89          89
22.00 New budget authority (gross)......         272         393         427
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......         348         482         516
23.95 Total new obligations.............        -259        -393        -427
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........          89          89          89
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Mandatory:

69.00   Spending authority from 
          offsetting collections 
          (gross): Offsetting 
          collections (cash)............         272         393         427
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..          20          22          22
73.10 Total new obligations.............         259         393         427
73.20 Total outlays (gross).............        -231        -393        -427
74.10 Change in uncollected customer 
        payments from Federal sources 
        (expired).......................         -26
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..          22          22          22
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.97 Outlays from new mandatory 
        authority.......................         231         393         427
----------------------------------------------------------------------------

    Offsets:
      Against gross budget authority and outlays:

        Offsetting collections (cash) 
            from:
88.00     Federal sources...............        -272        -393        -427
88.00     Federal sources...............          26
                                           ---------   ---------  ----------
88.90       Total, offsetting 
              collections (cash)........        -246        -393        -427
      Against gross budget authority only:

88.96   Portion of offsetting 
          collections (cash) credited to 
          expired accounts..............         -26
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................
90.00 Outlays...........................         -15
---------------------------------------------------------------------------

    VA Franchise Fund has permanent authority under P.L. 104-204, as 
amended by P.L. 109-114. Established in 1997, administrative services 
included in the Franchise Fund are financed on a fee-for-service basis 
rather than through VA's General Administration appropriation. VA 
Enterprise Centers are the lines of business within the VA Franchise 
Fund and are expected to have net billings of about $426 million and 
employ 744.

    The Franchise Fund concept is intended to increase competition for 
government administrative services resulting in lower costs and higher 
quality.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 36-4539-0-4-705      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
11.1  Personnel compensation: Full-time 
        permanent.......................          45          49          51
12.1  Civilian personnel benefits.......          10          11          12
21.0  Travel and transportation of 
        persons.........................           1           4           3
23.1  Rental payments to GSA............           4           1           1
23.3  Communications, utilities, and 
        miscellaneous charges...........          30          34          37
24.0  Printing and reproduction.........           2           6           6
25.2  Other services....................         155         273         304
26.0  Supplies and materials............           2           2           2
31.0  Equipment.........................          10          13          11
                                           ---------   ---------  ----------
99.9    Total new obligations...........         259         393         427
---------------------------------------------------------------------------

[[Page 987]]



                              Personnel Summary

----------------------------------------------------------------------------
Identification code 36-4539-0-4-705      2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
    Reimbursable:
2001  Civilian full-time equivalent 
        employment......................         688         745         744
---------------------------------------------------------------------------

                                


 
                      GENERAL FUND RECEIPT ACCOUNTS

                           (in millions of dollars)

----------------------------------------------------------------------------
                                         2005 actual   2006 est.   2007 est.
----------------------------------------------------------------------------
Offsetting receipts from the public:
  36-247300  Contributions from military 
    personnel, Veteran's Educational 
    Assistance Act of 1984..............         198         198         198
  36-273330  Housing downward 
    reestimates.........................       1,021       1,293
  36-275510  Housing negative subsidies.          84         125         147
                                           ---------   ---------  ----------
General Fund Offsetting receipts from 
 the public.............................       1,303       1,616         345
---------------------------------------------------------------------------

                                

                        Administrative Provisions

                      (including transfer of funds)

    Sec. 201. Any appropriation for fiscal year [2006] 2007 for 
``Compensation and pensions'', ``Readjustment benefits'', and ``Veterans 
insurance and indemnities'' may be transferred as necessary to any other 
of the mentioned appropriations: Provided, That before a transfer may 
take place, the Secretary of Veterans Affairs shall [request from] 
submit notice thereof to  the Committees on Appropriations of both 
Houses of Congress [the authority to make the transfer and an approval 
is issued, or absent a response,] and  a period of 30 days has elapsed.
    Sec. 202. Appropriations available in this title for salaries and 
expenses shall be available for services authorized by section 3109 of 
title 5, United States Code, hire of passenger motor vehicles; lease of 
a facility or land or both; and uniforms or allowances therefore, as 
authorized by sections 5901-5902 of title 5, United States Code.
    [Sec. 203. No appropriations in this title (except the 
appropriations for ``Construction, major projects'', and ``Construction, 
minor projects'') shall be available for the purchase of any site for or 
toward the construction of any new hospital or home.]
    Sec. [204] 203. No appropriations in this title shall be available 
for hospitalization or examination of any persons (except beneficiaries 
entitled under the laws bestowing such benefits to veterans, and persons 
receiving such treatment under sections 7901-7904 of title 5, United 
States Code or the Robert T. Stafford Disaster Relief and Emergency 
Assistance Act (42 U.S.C. 5121 et seq.)), unless reimbursement of cost 
is made to the ``Medical services'' account at such rates as may be 
fixed by the Secretary of Veterans Affairs.
    Sec. [205] 204. Appropriations available in this title for 
``Compensation and pensions'', ``Readjustment benefits'', and ``Veterans 
insurance and indemnities'' shall be available for payment of prior year 
accrued obligations required to be recorded by law against the 
corresponding prior year accounts within the last quarter of fiscal year 
[2005] 2006.
    Sec. [206] 205. Appropriations available in this title shall be 
available to pay prior year obligations of corresponding prior year 
appropriations accounts resulting from sections 3328(a), 3334, and 
3712(a) of title 31, United States Code, except that if such obligations 
are from trust fund accounts they shall be payable from ``Compensation 
and pensions''.
    Sec. [207] 206. Notwithstanding any other provision of law, during 
fiscal year [2006] 2007, the Secretary of Veterans Affairs shall, from 
the National Service Life Insurance Fund (38 U.S.C. 1920), the Veterans' 
Special Life Insurance Fund (38 U.S.C. 1923), and the United States 
Government Life Insurance Fund (38 U.S.C. 1955), reimburse the ``General 
operating expenses'' account for the cost of administration of the 
insurance programs financed through those accounts: Provided, That 
reimbursement shall be made only from the surplus earnings accumulated 
in an insurance program in fiscal year [2006] 2007 that are available 
for dividends in that program after claims have been paid and 
actuarially determined reserves have been set aside: Provided further, 
That if the cost of administration of an insurance program exceeds the 
amount of surplus earnings accumulated in that program, reimbursement 
shall be made only to the extent of such surplus earnings: Provided 
further, That the Secretary shall determine the cost of administration 
for fiscal year [2006] 2007 which is properly allocable to the provision 
of each insurance program and to the provision of any total disability 
income insurance included in such insurance program.
    [Sec. 208. The paragraph under the heading ``Franchise Fund'' in 
title I of Public Law 104-204 (31 U.S.C. 501 note) is amended--
        (1) by striking ``franchise fund pilot, as authorized by section 
    403 of Public Law 103-356, to be available as provided in such 
    section'' and inserting ``Department of Veterans Affairs franchise 
    fund, to be available without fiscal year limitation''; and
        (2) by striking the final proviso.]
    Sec. [209] 207. Amounts deducted from enhanced-use lease proceeds to 
reimburse an account for expenses incurred by that account during a 
prior fiscal year for providing enhanced-use lease services, may be 
obligated during the fiscal year in which the proceeds are received.
    Sec. [210] 208. Funds available in this title or funds for salaries 
and other administrative expenses shall also be available to reimburse 
the Office of Resolution Management and the Office of Employment 
Discrimination Complaint Adjudication for all services provided at rates 
which will recover actual costs but not exceed [$29,758,000] $31,246,000 
for the Office of Resolution Management and $3,059,000 for the Office of 
Employment and Discrimination Complaint Adjudication: Provided, That 
payments may be made in advance for services to be furnished based on 
estimated costs: Provided further, That amounts received shall be 
credited to ``General operating expenses'' for use by the office that 
provided the service.
    [Sec. 211. No appropriations in this title shall be available to 
enter into any new lease of real property if the estimated annual rental 
is more than $300,000 unless the Secretary submits a report which the 
Committees on Appropriations of both Houses of Congress approve within 
30 days following the date on which the report is received.]
    Sec. [212] 209. No funds of the Department of Veterans Affairs shall 
be available for hospital care, nursing home care, or medical services 
provided to any person under chapter 17 of title 38, United States Code, 
for a non-service-connected disability described in section 1729(a)(2) 
of such title, unless that person has disclosed to the Secretary of 
Veterans Affairs, in such form as the Secretary may require, current, 
accurate third-party reimbursement information for purposes of section 
1729 of such title: Provided, That the Secretary may recover, in the 
same manner as any other debt due the United States, the reasonable 
charges for such care or services from any person who does not make such 
disclosure as required: Provided further, That any amounts so recovered 
for care or services provided in a prior fiscal year may be obligated by 
the Secretary during the fiscal year in which amounts are received.
    Sec. [213] 210. Notwithstanding any other provision of law, at the 
discretion of the Secretary of Veterans Affairs, proceeds or revenues 
derived from enhanced-use leasing activities (including disposal) may be 
deposited into the ``Construction, major projects'' and ``Construction, 
minor projects'' accounts and be used for construction (including site 
acquisition and disposition), alterations and improvements of any 
medical facility under the jurisdiction or for the use of the Department 
of Veterans Affairs. Such sums as realized are in addition to the amount 
provided for in ``Construction, major projects'' and ``Construction, 
minor projects''.
    Sec. [214] 211. Amounts made available under ``Medical services'' 
are available--
        (1) for furnishing recreational facilities, supplies, and 
    equipment; and
        (2) for funeral expenses, burial expenses, and other expenses 
    incidental to funerals and burials for beneficiaries receiving care 
    in the Department.

                      (including transfer of funds)

    Sec. [215] 212. [That such] Such sums as may be deposited to the 
Medical Care Collections Fund pursuant to section 1729A of title 38, 
United States Code, may be transferred to ``Medical services'', to 
remain available until expended for the purposes of this account.

                      (including transfer of funds)

    Sec. [216] 213. Amounts made available for fiscal year [2006] 2007 
under the ``Medical services'', ``Medical administration'', and 
``Medical facilities'' accounts may be transferred among the accounts to 
the extent necessary to implement the restructuring of the Veterans 
Health Administration accounts: Provided, That before a trans

[[Page 988]]

fer may take place, the Secretary of Veterans Affairs shall [request 
from] submit notice thereof to the Committees on Appropriations of both 
Houses of Congress [the authority to make the transfer and an approval 
is issued].

                      (including transfer of funds)

    [Sec. 217. Any appropriation for fiscal year 2006 for the Veterans 
Benefits Administration made available under the heading ``General 
operating expenses'' may be transferred to the ``Veterans Housing 
Benefit Program Fund Program Account'' for the purpose of providing 
funds for the nationwide property management contract if the 
administrative costs of such contract exceed $8,800,000 in the fiscal 
year.]
    Sec. [218] 214. Notwithstanding any other provision of law, the 
Secretary of Veterans Affairs shall allow veterans eligible under 
existing Department of Veterans Affairs medical care requirements and 
who reside in Alaska to obtain medical care services from medical 
facilities supported by the Indian Health Service or tribal 
organizations. The Secretary shall: (1) limit the application of this 
provision to rural Alaskan veterans in areas where an existing 
Department of Veterans Affairs facility or Veterans Affairs-contracted 
service is unavailable; (2) require participating veterans and 
facilities to comply with all appropriate rules and regulations, as 
established by the Secretary; (3) require this provision to be 
consistent with Capital Asset Realignment for Enhanced Services 
activities; and (4) result in no additional cost to the Department of 
Veterans Affairs or the Indian Health Service.

                      (including transfer of funds)

    Sec. [219] 215. [That such] Such sums as may be deposited to the 
Department of Veterans Affairs Capital Asset Fund pursuant to section 
8118 of title 38, United States Code, may be transferred to the 
``Construction, major projects'' and ``Construction, minor projects'' 
accounts, to remain available until expended for the purposes of these 
accounts.
    [Sec. 220. None of the funds available to the Department of Veterans 
Affairs, in this Act or any other Act, may be used to replace the 
current system by which the Veterans Integrated Service Networks select 
and contract for diabetes monitoring supplies and equipment.]
    [Sec. 221. None of the funds made available in this Act may be used 
to implement any policy prohibiting the Directors of the Veterans 
Integrated Service Networks from conducting outreach or marketing to 
enroll new veterans within their respective Networks.]
    Sec. [222] 216. The Secretary of Veterans Affairs shall submit to 
the Committees on Appropriations of both Houses of Congress a quarterly 
report on the financial status of the Veterans Health Administration.
    [Sec. 223. None of the funds made available in this Act or any other 
Act may be used--
        (1) with respect to the 2,100 compensation cases identified in 
    the Scope and Methodology description in VA Inspector General Report 
    No. 05-00765-137 as having been reviewed by the Office of Inspector 
    General--
                (A) to retroactively revoke or reduce a veteran's 
            disability compensation payments for post traumatic stress 
            disorder based on a finding that the Department of Veterans 
            Affairs failed to collect justifying documentation unless 
            the award of compensation was the direct result of fraud by 
            the applicant; or
                (B) to prospectively revoke or reduce a veteran's 
            disability compensation payments for post traumatic stress 
            disorder, based on a finding that the Department of Veterans 
            Affairs failed to collect justifying documentation, 
            effective before the date on which the veteran's time to 
            exhaust all available administrative and judicial appeals 
            has expired or such administrative and judicial appeals are 
            finally decided; or
        (2) for the implementation of Recommendation 3 of VA Inspector 
    General Report No. 05-00765-137 or any related review and 
    investigation of post traumatic stress, individual unemployability, 
    and schedular 100 percent ratings cases, until the Department of 
    Veterans Affairs reports to the Committees on Appropriations of both 
    Houses of Congress on its plans for implementing this 
    recommendation, and outlines the staffing and funding requirements.]
    [Sec. 224. Clinical training and protocols. (a) Findings.--Congress 
finds that--
        (1) the Iraq War Clinician Guide has tremendous value; and
        (2) the Secretary of Defense and the National Center on Post 
    Traumatic Stress Disorder should continue to work together to ensure 
    that the mental health care needs of servicemembers and veterans are 
    met.
    (b) Collaboration.--The National Center on Post Traumatic Stress 
Disorder shall collaborate with the Secretary of Defense--
        (1) to enhance the clinical skills of military clinicians 
    through training, treatment protocols, web-based interventions, and 
    the development of evidence-based interventions; and
        (2) to promote pre-deployment resilience and post-deployment 
    readjustment among servicemembers serving in Operation Iraqi Freedom 
    and Operation Enduring Freedom.
    (c) Training.--The National Center on Post Traumatic Stress Disorder 
shall work with the Secretary of Defense to ensure that clinicians in 
the Department of Defense are provided with the training and protocols 
developed pursuant to subsection (b)(1).]

                      (including transfer of funds)

    [Sec. 225. Amounts made available under the ``Medical 
administration'', ``Medical services'', ``Medical facilities'', 
``General operating expenses'', ``National Cemetery Administration'' and 
``Office of Inspector General'' accounts for fiscal year 2006, may be 
transferred to or from the ``Information technology systems'' account: 
Provided, That before a transfer may take place, the Secretary of 
Veterans Affairs shall request from the Committees on Appropriations of 
both Houses of Congress the authority to make the transfer and an 
approval is issued.]

                      (including transfer of funds)

    [Sec. 226. For purposes of perfecting the funding sources of the 
Department of Veterans Affairs' new ``Information technology systems'' 
account, funds made available for fiscal year 2006 may be transferred 
from the ``General operating expenses'', ``National Cemetery 
Administration'', and ``Office of Inspector General'' accounts to the 
``Medical administration'' account: Provided, That before a transfer may 
take place, the Secretary of Veterans Affairs shall request from the 
Committees on Appropriations of both Houses of Congress the authority to 
make the transfer and an approval is issued.]

                      (including transfer of funds)

    Sec. [227] 217. Amounts made available for the ``Information 
technology systems'' account may be transferred between projects: 
Provided, That no project may be increased or decreased by more than 
$1,000,000 of cost prior to submitting [a request] notice thereof to the 
Committees on Appropriations of both Houses of Congress [the authority 
to make the transfer and an approval is issued, or absent a response,] 
and a period of 30 days has elapsed.
    [Sec. 228. The Department of Veterans Affairs shall conduct an 
information campaign in States with an average annual disability 
compensation payment of less than $7,300 (according to the report issued 
by the Department of Veterans Affairs Office of Inspector General on May 
19, 2005), to inform all veterans receiving disability compensation, by 
direct mail, of the history of below average disability compensation 
payments to veterans in such States, and to provide all veterans in each 
such State, through broadcast or print advertising, with the 
aforementioned historical information and instructions for submitting 
new claims and requesting review of past disability claims and ratings.]
    [Sec. 229. Of the funds available to the Department of Veterans 
Affairs in this Act or any other Act, no more than $50,000,000 shall be 
available for the HealtheVetVista project, for fiscal year 2006: 
Provided, That none of the funds made available for the HealtheVetVista 
project may be obligated until the Committees on Appropriations of both 
Houses of Congress approve a financial expenditure plan for the entire 
project.]
    Sec. [230] 217. The authority provided by section 2011 of title 38, 
United States Code, shall continue in effect through September 30, 
[2006] 2007. (Military Construction, Military Quality of Life and 
Veterans Affairs Appropriations Act, 2006.)

                                


 
                      TITLE IV--GENERAL PROVISIONS

    Sec. 401. No part of any appropriation contained in this Act shall 
remain available for obligation beyond the current fiscal year unless 
expressly so provided herein.

[[Page 989]]

    Sec. 402. Such sums as may be necessary for fiscal year [2006] 2007 
pay raises for programs funded by this Act shall be absorbed within the 
levels appropriated in this Act.
    Sec. 403. None of the funds made available in this Act may be used 
for any program, project, or activity, when it is made known to the 
Federal entity or official to which the funds are made available that 
the program, project, or activity is not in compliance with any Federal 
law relating to risk assessment, the protection of private property 
rights, or unfunded mandates.
    Sec. 404. No part of any funds appropriated in this Act shall be 
used by an agency of the executive branch, other than for normal and 
recognized executive-legislative relationships, for publicity or 
propaganda purposes, and for the preparation, distribution or use of any 
kit, pamphlet, booklet, publication, radio, television or film 
presentation designed to support or defeat legislation pending before 
Congress, except in presentation to Congress itself.
    Sec. 405. All departments and agencies funded under this Act are 
encouraged, within the limits of the existing statutory authorities and 
funding, to expand their use of ``E-Commerce'' technologies and 
procedures in the conduct of their business practices and public service 
activities.
    [Sec. 406. None of the funds made available in this Act may be 
transferred to any department, agency, or instrumentality of the United 
States Government except pursuant to a transfer made by, or transfer 
authority provided in, this Act or any other appropriations Act.]
    Sec. [407] 406. Unless stated otherwise, all reports and 
notifications required by this Act shall be submitted to the 
Subcommittee on Military Quality of Life and Veterans Affairs, and 
Related Agencies of the Committee on Appropriations of the House of 
Representatives and the Subcommittee on Military Construction and 
Veterans Affairs, and Related Agencies of the Committee on 
Appropriations of the Senate.
    [Sec. 408. (a) Section 613 of the Science, State, Justice, Commerce, 
and Related Agencies Appropriations Act, 2006, is amended by striking 
``the United States-China Economic and Security Review Commission'', and 
inserting ``a grant for the Trade Lawyers Advisory Group''.
    (b) The amendment made by paragraph (1) shall take effect on the 
date of enactment of the Science, State, Justice, Commerce, and Related 
Agencies Appropriations Act, 2006.] (Military Construction, Military 
Quality of Life and Veterans Affairs Appropriations Act, 2006.)