[Senate Hearing 110-809]
[From the U.S. Government Publishing Office]



                                                        S. Hrg. 110-809
 
                   NOMINATIONS OF THE 110TH CONGRESS

=======================================================================

                                HEARING

                               BEFORE THE

                     COMMITTEE ON VETERANS' AFFAIRS
                          UNITED STATES SENATE

                       ONE HUNDRED TENTH CONGRESS

                       FIRST AND SECOND SESSIONS

                               __________

           JUNE 27, SEPTEMBER 27, AND NOVEMBER 14, 2007, AND 
                     JUNE 26 AND SEPTEMBER 17, 2008

                               __________

       Printed for the use of the Committee on Veterans' Affairs


 Available via the World Wide Web: http://www.access.gpo.gov/congress/
                                 senate




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                     COMMITTEE ON VETERANS' AFFAIRS

                   Daniel K. Akaka, Hawaii, Chairman
John D. Rockefeller IV, West         Richard Burr,\1\ North Carolina, 
    Virginia                             Ranking Member
Patty Murray, Washington             Arlen Specter, Pennsylvania
Barack Obama, Illinois               Larry E. Craig, Idaho
Bernard Sanders, (I) Vermont         Kay Bailey Hutchison, Texas
Sherrod Brown, Ohio                  John Ensign, Nevada
Jim Webb, Virginia                   Lindsey O. Graham, South Carolina
Jon Tester, Montana                  Johnny Isakson, Georgia
                                     Roger F. Wicker,\2\ Mississippi
                    William E. Brew, Staff Director
                 Lupe Wissel, Republican Staff Director



----------
\1\ Hon. Richard Burr replaced Hon. Larry E. Craig as the Ranking 
Member on September 11, 2007.
\2\ Hon. Roger F. Wicker was appointed to the Committee on January 24, 
2008, replacing Hon. John Ensign.










                            C O N T E N T S

                              ----------                              

                             June 27, 2007
Nomination of Charles L. Hopkins III to be Assistant Secretary, Office 
of Operations, Security, and Preparedness (OSP), Department of Veterans 
                                Affairs
                                SENATORS

                                                                   Page
Akaka, Hon. Daniel K., Chairman, U.S. Senator from Hawaii........     1
Craig, Hon. Larry E., Ranking Member, U.S. Senator from Idaho....     2
    Prepared statement...........................................     2

                                WITNESS

Hopkins, Charles L., III, Nominee to be Assistant Secretary, 
  Office of Operations, Security, and Preparedness (OSP), 
  Department of Veterans Affairs.................................     3
    Prepared statement...........................................     5
    Questionnaire for Presidential nominees......................     8
    Letter from the Office of Government Ethics..................    14
    Letter from the Department of Veterans Administration, Office 
      of General Counsel.........................................    14
                              ----------                              

                           September 27, 2007
         Nomination of Paul J. Hutter to be General Counsel of 
                   the Department of Veterans Affairs
                                SENATORS

Akaka, Hon. Daniel K., Chairman, U.S. Senator from Hawaii........    19
Burr, Hon. Richard, U.S. Senator from North Carolina.............    20
Murray, Hon. Patty, U.S. Senator from Washington.................    41
    Prepared statement...........................................    41
Isakson, Hon. John, U.S. Senator from Georgia....................    45

                               WITNESSES

Hutter, Paul J., Nominee for General Counsel of the Department of 
  Veterans Affairs...............................................    22
    Prepared statement...........................................    23
    Questionnaire for Presidential nominees......................    24
    Letter from the Office of Government Ethics..................    30
    Response to pre-hearing questions submitted by Hon. Daniel K. 
      Akaka......................................................    30
        Attachment...............................................    35
    Response to post-hearing questions submitted by Hon. Daniel 
      K. Akaka...................................................    36
                              ----------                              

                           November 14, 2007
    Nomination of Michael W. Hager to be Assistant Secretary, Human 
        Resources and Management, Department of Veterans Affairs
                                SENATORS

Akaka, Hon. Daniel K., Chairman, U.S. Senator from Hawaii........    49
Burr, Hon. Richard, Ranking Member, U.S. Senator from North 
  Carolina.......................................................    50

                               WITNESSES

Hager, Michael W., Nominee to be Assistant Secretary, Human 
  Resources and Management, U.S. Department of Veterans Affairs..    52
    Prepared statement...........................................    53
    Questionnaire for Presidential nominees......................    55
    Letter from the Office of Government Ethics..................    60
    Letter from the Department of Veterans Administration, Office 
      of General Counsel.........................................    60
    Response to written questions submitted by Hon. Daniel K. 
      Akaka......................................................    61
                              ----------                              

                             June 26, 2008
        Nomination of Christine Hill to be Assistant Secretary 
              of Veterans Affairs (Congressional Affairs)
                                SENATORS

Akaka, Hon. Daniel K., Chairman, U.S. Senator from Hawaii........    69
Burr, Hon. Richard, Ranking Member, U.S. Senator from North 
  Carolina.......................................................    71
Isakson, Hon. Johnny, U.S. Senator from Georgia..................    82

                               WITNESSES

Dole, Hon. Elizabeth, U.S. Senator from North Carolina...........    69
Hill, Christine O., Nominee for Assistant Secretary, 
  Congressional and Legislative Affairs, Department of Veterans' 
  Affairs........................................................    71
    Prepared statement...........................................    73
    Questionnaire for Presidential nominees......................    74
    Letter from the Office of Government Ethics..................    80

                           September 17, 2008
 Nomination of Patrick W. Dunne to be Under Secretary for Benefits of 
                   the Department of Veterans Affairs
                                SENATORS

Akaka, Hon. Daniel K., Chairman, U.S. Senator from Hawaii........    85
Burr, Hon. Richard, Ranking Member, U.S. Senator from North 
  Carolina.......................................................    86
Murray, Hon. Patty, U.S. Senator from Washington.................    88
Tester, Hon. Jon, U.S. Senator from Montana......................    89

                               WITNESSES

Dunne, Hon. Patrick W., Nominee to be Under Secretary for 
  Benefits, Department of Veterans Affairs.......................    89
    Prepared statement...........................................    90
    Questionnaire for Presidential nominees......................    92
    Letter from the Office of Government Ethics..................    98
    Response to written questions submitted by:
      Hon. Daniel K. Akaka.......................................    98
      Hon. Bernard Sanders.......................................   104


NOMINATION OF CHARLES L. HOPKINS III, TO BE ASSISTANT SECRETARY, OFFICE 
                                  OF 
 OPERATIONS, SECURITY, AND PREPAREDNESS (OSP), DEPARTMENT OF VETERANS 
                                AFFAIRS

                              ----------                              


                        WEDNESDAY, JUNE 27, 2007

                                       U.S. Senate,
                            Committee on Veterans' Affairs,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 10:59 a.m., in 
room 562, Dirksen Senate Office Building, Hon. Daniel K. Akaka, 
Chairman of the Committee, presiding.
    Present: Senators Akaka and Craig.

     OPENING STATEMENT OF HON. DANIEL K. AKAKA, CHAIRMAN, 
                    U.S. SENATOR FROM HAWAII

    Chairman Akaka. Good morning. This hearing will come to 
order.
    The Committee is here today to consider the nomination of 
Charles L. Hopkins III, to be VA's Assistant Secretary for 
Operations, Security, and Preparedness. I am pleased to welcome 
Mr. Hopkins and his family. As we say in Hawaii, welcome to our 

hearing.
    Mr. Hopkins, if confirmed, you will be responsible for 
coordinating the Department's emergency management, 
preparedness, security, and law enforcement activities. This 
new position within VA will impact on veterans on a daily basis 
as you provide for the physical security of VA facilities, its 
employees, veterans receiving care, and visitors. You also have 
the important task of preparing and coordinating VA's response 
to war, terrorism, natural security and natural disasters while 
ensuring continuing service to our veterans.
    With the threats that currently confront the Nation, I 
remain concerned about VA's ability to support the National 
Response Plan and serve as a Contingency Hospital System 
Partner to the Department of Defense. Although this so-called 
fourth mission is primarily a VHA responsibility by definition, 
the Office of Operations, Security, and Preparedness will be 
intimately involved in its coordination. I trust that you will 
work with the appropriate offices within VHA to make this 
process as efficient as possible.
    If VA is to serve effectively as backup to the DOD health 
care system and support communities following a domestic 
terrorist incident or natural disaster, it must have detailed 
plans that are properly resourced and regularly exercised. 
Incidents or disasters of the magnitude which would bring the 
VA's vast capabilities into play offer few second chances. As 
we saw with the government's response to Hurricane Katrina, 
there is no substitute for adequate planning, training, and 
preparedness.
    Your experience as Director of the Office of National 
Security at FEMA combined with your prior emergency 
preparedness background at other Federal agencies and your many 
years of experience in military service suggest that you have 
the qualifications for taking on the challenges of this new 
office. Assuming you are confirmed, I urge you to work closely 
with the three VA administrations and key staff offices to 
develop workable and viable plans that will enable VA to 
respond effectively to any emergency.
    In closing, I note that the nominee has completed the 
Committee questionnaire for Presidential nominees and responded 
to my pre-hearing questions, all of which will appear in the 
hearing record.
    Chairman Akaka. Also included will be a letter from the 
Office of Government Ethics acknowledging that he is in 
compliance with laws and regulations governing conflicts of 
interest.
    Chairman Akaka. So I would like to now call on Senator 
Craig for his statement.

       STATEMENT OF HON. LARRY E. CRAIG, RANKING MEMBER, 
                    U.S. SENATOR FROM IDAHO

    Senator Craig. Mr. Chairman, thank you very much for 
holding this hearing on a timely basis for the nomination of 
Charles Hopkins. Let me also recognize in the room his wife, 
Martha, and their family. We are appreciative that they would 
also attend.
    Mr. Chairman, you have outlined the obligations of the 
office and the qualifications of the nominee. Clearly, Charles 
is well qualified with a phenomenal lifetime of experience 
dealing with the kinds of emergency preparedness issues facing 
VA and has an understanding of how these situations are met 
institutionally and in a timely fashion, so let me ask 
unanimous consent that my full statement be a part of the 
record.
    Again, I would very much agree with you that he is highly 
qualified for the position at hand. I am pleased that the 
President has nominated him and will look forward to his 
comments and response to questions. Thank you very much, Mr. 
Chairman.
    [The prepared statement of Senator Craig follows:]

      Prepared Statement of Hon. Larry E. Craig, Ranking Member, 
                        U.S. Senator from Idaho

    Good morning Mr. Chairman. I want to thank you very much 
for calling this hearing to review Mr. Charles Hopkins' 
qualifications to serve as the VA's first Assistant Secretary 
for Operations, Security, and Preparedness.
    Before I begin, I would like to recognize those members of 
Mr. Hopkins family that are in attendance. Specifically, his 
wife, Martha--and their children.
    Mr. Chairman, I'd like to say at the outset of this hearing 
that based on a review of his record and having spent some time 
with him personally, I believe Mr. Hopkins is very qualified 
for this job. And I support his nomination.
    Charles Hopkins is a veteran of the United States Navy and 
has served his country for 29 years. Following his 29 years of 
honorable and distinguished service, Mr. Hopkins was lured into 
the private sector to share his experience, knowledge, and 
leadership. This was to be a short-lived venture as he was in 
the private sector for only 3\1/2\ years. It was his commitment 
to public service and his incredible love for his country that 
led him back to Federal service.
    Mr. Hopkins' return to government service began as the 
Director of Emergency Programs for the Department of the 
Treasury. He served in this position for more than two years 
before moving on to the Internal Revenue Service.
    At the IRS, he held the position of Director of Emergency 
Management Programs. He was responsible for all policy, 
technical, and operational matters. He excelled in his position 
and demonstrated knowledge, commitment, and ability. It was at 
this point that Mr. Hopkins accepted his current position at 
FEMA as Director of the Office of National Security 
Coordination.
    In his position at FEMA, he has worked diligently to ensure 
common standards for agencies, continuity of operations, and 
continuity of government.
    I believe Mr. Hopkins' military background and his Federal 
service make him the right man for this job. His breadth of 
experience, commitment to the United States, and technical 
expertise combine to make him very qualified to serve in this 
new position.
    Mr. Chairman, I hope the Committee will be able to move 
swiftly on this confirmation. The VA must be prepared for any 
emergency. After Katrina, we all learned how much a good 
emergency plan means to our veterans and to our local 
communities. This new office needs strong leadership and I 
believe Charles Hopkins meets that criteria.

    Thank you, again, Mr. Chairman, for holding this hearing.

    Chairman Akaka. Thank you very much, Senator Craig. Your 
full statement will be included in the record.
    Mr. Hopkins, before I swear you in and you make your 
opening statement, I note that you have a lovely family here 
and I would like to take the time now to have you introduce the 
members of your family.
    Mr. Hopkins. Yes, sir. I would be delighted. With me today 
is my wife of 37 years, Martha; my son-in-law Major Jano 
Carlson, United States Marine Corps, a veteran of two 
conflicts--one in Afghanistan and one in Iraq; his wife and my 
lovely daughter Shelagh; a wonderful father and wonderful son, 
my son, Chip (Charles IV), and his lovely wife, Traci; and my 
lovely daughter, Shannon. I regret that my other son-in-law, 
Bradly Duckworth, can't be with us today as he is a member of 
the Navy Criminal Investigative Service, another service of our 
great country, and he is currently serving in Iraq.
    Chairman Akaka. Mr. Hopkins, will you please rise to take 
the oath. Will you raise your right hand.
    Do you solemnly swear that the testimony you are about to 
give this Committee is the truth, the whole truth, and nothing 
but the truth, so help you, God?
    Mr. Hopkins. I do, sir.
    Chairman Akaka. Thank you. Let the record note that the 
witness responded in the affirmative.
    Mr. Hopkins, will you please proceed with your statement.

      STATEMENT OF CHARLES L. HOPKINS III, NOMINEE TO BE 
   ASSISTANT SECRETARY, OFFICE OF OPERATIONS, SECURITY, AND 
       PREPAREDNESS (OSP), DEPARTMENT OF VETERANS AFFAIRS

    Mr. Hopkins. Mr. Chairman and Members of the Committee, 
good morning. Thank you for the privilege and honor to appear 
before you today. I am deeply honored and humbled by the 
confidence President Bush has shown in nominating me to serve 
as the Assistant Secretary for Operations, Security, and 
Preparedness in the Department of Veterans Affairs. I am also 
most grateful to Secretary Nicholson for his confidence in my 
abilities to once again serve this great Nation.
    For the past 37 years, it has been my privilege to serve 
this great country in many capacities, and my dedication to the 
United States military is marked by a history of service and 
commitment. I spent 29 of those years in the United States 
Navy. During my tours at sea on submarines and ashore in many 
different home ports, I developed a deep respect and 
appreciation for the personnel who serve in our Armed Forces 
and their families. Time and again, they displayed the honor, 
courage, and commitment that makes our Armed Forces the 
greatest in the world. As time marches on, they too will become 
veterans.
    Personal sacrifice and devotion to duty is routine among 
members of the military, so they deserve our unwavering support 
both while wearing the uniform and when they transition into 
the community of veterans. I am privileged to have this 
opportunity to work with them and support the critically 
important mission stated so many years ago by President 
Lincoln, ``to care for him who shall have borne the battle and 
for his widow and orphan.''
    I have come full circle. I proudly wore the uniform for 
many years, and now I have the opportunity to serve our great 
veterans through continued public service.
    So I am inspired by them to tackle the challenges of the 
mission of the Department of Veterans Affairs and more 
specifically the challenges that this new position offers. If 
confirmed, I look forward to joining the team of professionals 
at the Department of Veterans Affairs to accomplish that 
mission.
    As Assistant Secretary for Operations, Security, and 
Preparedness, I am responsible for providing the advice and 
counsel to the Secretary and other senior leaders on the 
Department's capabilities and readiness to continue services to 
veterans and their families and respond to contingency support 
missions during national emergencies. I see this position as 
the custodian of special trust that the Department has to 
ensure our Nation's veterans and their families, visitors and 
staff that serve them have secure and safe environments for the 
care and service.
    If confirmed, I will serve the veterans of this great 
country with the same dedication and passion as when I served 
on active duty and I will commit all my efforts to ensure that 
the veterans are treated with the dignity and respect that they 
rightfully deserve.
    For the last 20 months, I have been the Director of the 
Office of National Security Coordination, now known as National 
Continuity Programs, at the Federal Emergency Management 
Agency. This office is the lead agent for the executive branch 
Continuity Programs. My responsibilities focused on formulating 
guidance and establishing common standards for executive branch 
departments and agencies to be used in developing viable and 
executable continuity plans. I also facilitated interagency 
coordination and I oversaw and assessed the status of 
continuity capabilities for the executive branch departments 
and agencies.
    So I am very familiar with the work that must be 
accomplished to form a new significantly expanded organization 
and also to remedy any deficiencies that exist within the area 
of operations, security, and preparedness. I am confident that 
my experience in the United States Navy and my public work 
since then has helped to hone the skills required to lead the 
organization effectively and contribute to the successful 
accomplishment of a wide variety of important tasks.
    If confirmed, I would like to share with you the priorities 
that I would pursue as the Assistant Secretary for Operations, 
Security, and Preparedness. First, I will improve the ability 
of our law enforcement officers to accommodate the needs of all 
veterans, and more importantly, the special needs of veterans 
returning from Operation Iraqi Freedom and Operation Enduring 
Freedom.
    Next, I will work closely with the Department's 
administrations to protect veterans, their families, the 
people, facilities, and infrastructure needed to deliver the 
highest-quality care and services and ensure continuing 
availability of that service. I will work diligently to ensure 
the security of the people and information within the 
Department and develop the plans, policies, and procedures to 
provide for appropriate response and to rapidly reconstitute 
Departmental operations after a national disaster or incident.
    Next, while implementing the new Executive Order for 
National Continuity Programs with our Federal partners and 
stakeholders, I will strengthen the internal and external 
command, control, and communications links and develop training 
programs that will continually improve the Department's 
operational and emergency management capabilities.
    Finally, I will establish a robust evaluation mechanism to 
regularly assess my Division's and the Department's performance 
in each of our primary mission areas.
    Mr. Chairman and Committee Members, I testify before you 
today as a proud son of World War II veterans. Both my parents 
rightfully earned a place on the team called ``the greatest 
generation,'' a generation of amazing men and women who 
understood the meaning of service to their country and whose 
service and commitment saved this Nation and the world from 
tyranny and oppression. It was my parents that instilled in me 
the meaning of honor, courage, and commitment.
    If confirmed, I intend to follow the great examples of my 
parents' generation and serve our Nation's heroes with great 
respect, humility, and passion. I am a humble man and I only 
hope that I have instilled the same sense of purpose in my 
family that my parents instilled in me.
    In closing, I would like to say to my entire family that I 
am now and will be forever grateful for your constant and 
unwavering love and support. I thank you all for the great 
support you have always provided in our journey of service to 
our great Nation.
    Thank you, sir. It is an honor to be here today. I am ready 
to serve and I look forward to your questions.
    [The prepared statement of Mr. Hopkins follows:]
 Prepared Statement of Charles L. Hopkins III, Nominee to be Assistant 
  Secretary, Office of Operations, Security, and Preparedness (OSP), 
                     Department of Veterans Affairs
    Mr. Chairman and Members of the Committee, good morning. Thank you 
for the privilege and honor to appear before you today. I am deeply 
honored and humbled by the confidence President Bush has shown in 
nominating me to serve as the Assistant Secretary for Operations, 
Security, and Preparedness in the Department of Veterans Affairs. I am 
also most grateful to Secretary Jim Nicholson for his confidence in my 
abilities to once again serve this great Nation.
    For the past 37 years it has been my privilege to serve this great 
country in many capacities and my dedication to the United States 
Military is marked by a history of service and commitment. I spent 29 
of those years in the United States Navy. During my tours at sea on 
submarines and ashore in many different home ports, I developed a deep 
respect and appreciation for the personnel who serve in our Armed 
Forces and their families. Time and again they displayed the Honor, 
Courage and Commitment that makes our Armed Forces the greatest in the 
world. As time marches on, they too will become Veterans.
    Personal sacrifice and devotion to duty is routine among members of 
the military so they deserve our unwavering support both while wearing 
the uniform and when they transition into the community of veterans. I 
am privileged to have this opportunity to work for them and support 
that critically important mission stated many years ago by President 
Lincoln: ``To care for him who shall have borne the battle and for his 
widow and orphan.'' I have come full circle--I proudly wore the Navy 
uniform for many years and now I have an opportunity to serve our 
Nation's veterans through continued public service.
    So I am inspired by them to tackle the challenges of the mission of 
the Department of Veterans Affairs and more specifically, the 
challenges that this new position offers. If confirmed, I look forward 
to joining the team of professionals at the Department of Veterans 
Affairs to accomplish that mission.
    The Assistant Secretary for Operations, Security, and Preparedness 
is responsible for providing advice and counsel to the Secretary and 
other senior leaders on the Department's capabilities and readiness to 
continue services to veterans and their families and respond to 
contingency support missions during national emergencies. I see this 
position as the custodian of special trust that the Department has to 
ensure our Nation's veterans, their families, visitors and the staffs 
that serve them, have secure and safe environments for care and 
service. If confirmed, I will serve the veterans of this great country 
with the same dedication and passion as when I served on active duty 
and I will commit all my efforts to ensure that all veterans are 
treated with the dignity and respect they rightfully deserve.
    For the last 20 months, I have been the Director of the Office of 
National Security Coordination (now known as National Continuity 
Programs) at the Federal Emergency Management Agency. This office is 
the Lead Agent for executive branch Continuity Programs. My 
responsibilities focused on formulating guidance, and establishing 
common standards for executive branch departments and agencies to use 
in developing viable and executable continuity plans; facilitate 
interagency coordination; and oversee and assess the status of 
continuity capabilities of Federal executive branch departments and 
agencies. So I am very familiar with all the work that must be 
accomplished to form a new, significantly expanded, organization and to 
also remedy any of the deficiencies that exist within the area of 
operations, security, and preparedness. I am confident that my 
experience in the United States Navy and my public work since then has 
helped hone the skills required to lead the organization effectively 
and contribute to the successful accomplishment of a wide variety of 
important tasks.
    If confirmed, I would like to share with you the priorities that I 
would pursue as the Assistant Secretary for Operations, Security, and 
Preparedness. First, I will improve the ability of our law enforcement 
officers to accommodate the needs of all veterans and more importantly, 
the special needs of veterans returning from Operation Iraqi Freedom 
and Operation Enduring Freedom. Next, I will work closely with the 
Department's Veterans Health Administration, Veterans Benefit 
Administration and National Cemetery Administration to protect 
veterans, their families, the people, facilities and infrastructure 
needed to deliver the highest quality care and services and ensure 
continuing availability of that service. I will work diligently to 
ensure the security of people and information within the Department and 
develop the plans, policies and procedures to provide for appropriate 
response and to rapidly reconstitute departmental operations after a 
national disaster or incident. Next, while implementing the new 
Executive Order for National Continuity Programs (NSPD-5 1/HSPD-20) 
with our Federal partners and stakeholders, I will strengthen the 
internal and external command, control and communications links and 
develop training programs that will continually improve the 
Department's operational and emergency management capabilities. 
Finally, I will establish a robust program evaluation mechanism to 
regularly assess my divisions and the Department's performance in each 
of our primary mission areas.
    Mr. Chairman, I testify before you today as a proud son of a 
veteran of World War II and a member of the Greatest Generation, a 
generation of great men and women who understood the meaning of service 
to their country. It was their service and commitment that saved this 
Nation and the world from tyranny and oppression and it was my parents 
that instilled in me the meaning of honor, commitment, courage and 
service to our country. If confirmed, I intend to follow the great 
examples of my parent's generation and serve our Nations' heroes with 
great respect, humility and passion.
    I am a humble man and I only hope that I have instilled the same 
sense of purpose in my family that my parents instilled in me. Only 
time will tell but today I am proud to introduce my family members that 
have joined me for this hearing. First, and foremost, is my wife of 37 
years Martha. Next, my son-in-law Major Jano Carlson USMC (a veteran of 
Operation Enduring Freedom and Operation Iraqi Freedom), his wife and 
my daughter Shelagh. Next, another son-in-law Special Agent Bradly 
Duckworth, with the Navy Criminal Investigative Service, cannot be here 
today as he is currently serving in Iraq; his wife Shannon and my 
entire family prays for his speedy return. Next, is a wonderful man and 
great father, my son Charles and his wife Traci.
    In closing I would like to say to my entire family that I am now 
and will be forever grateful for your constant and unwavering love and 
support. I thank you all for the great support that you have always 
provided in our journey of service to our great Nation.

    Sir, it's truly an honor for me to be here today. I stand ready to 
serve and look forward to your questions.

    [The Committee questionnaire for Presidential nominees from 
Mr. Hopkins follows:]

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

                                      United States
                               Office of Government Ethics,
                                    Washington, DC, April 13, 2007.
Hon. Daniel K. Akaka,
Chairman, Committee on Veterans' Affairs,
U.S. Senate, Washington, DC.
    Dear Mr. Chairman: In accordance with the Ethics in Government Act 
of 1978, I enclose a copy of the financial disclosure report filed by 
Charles L. Hopkins III, who has been nominated by President Bush for 
the position of Assistant secretary for Operations, Preparedness, 
Security and Law Enforcement, Department of Veterans Affairs.
    We have reviewed the report and have also obtained advice from the 
Department of Veterans Affairs concerning any possible conflict in 
light of its functions and the nominee's proposed duties. Also enclosed 
is a letter dated April 12, 2007, from the agency's ethics official, 
outlining the steps Mr. Hopkins will take to avoid conflicts of 
interest. Unless a specific date has been agreed to, the nominee must 
fully comply within three months of his confirmation date with any 
action he agreed to take in his ethics agreement.
    Based thereon, we believe that Mr. Hopkins is in compliance with 
applicable laws and regulations governing conflicts of interest.
                                          Robert I. Cusick,
                                                          Director.
    Enclosures.
                                 ______
                                 
                    Department of Veterans Affairs,
                             Office of the General Counsel,
                                    Washington, DC, April 12, 2007.
Mr. Robert I. Cusick,
Director, Office of Government Ethics,
Suite 500, 1201 New York Avenue, NW.,
Washington, DC.
    Dear Mr. Cusick: In accordance with section 2634.605(c) of title 5, 
Code of Federal Regulations, I am forwarding the enclosed Public 
Financial Disclosure Report (SF-278) of Charles Louis Hopkins III. 
President Bush has nominated Mr. Hopkins to serve in the position of 
Assistant Secretary for Operations, Security and Preparedness of the 
Department of Veterans Affairs (VA). It is my opinion that Mr. 
Hopkins's report is complete and discloses no unresolved conflicts of 
interest under applicable law or regulation.
    Mr. Hopkins has agreed pursuant to 18 U.S.C. Sec.  208(a) that he 
will not participate personally and substantially in any particular 
matter that has a direct and predictable effect on his financial 
interests or those of any other person whose interests are imputed to 
him, unless he first obtains a written waiver under section 208(b)(1), 
or qualifies for a regulatory exemption under section 208(b)(2) and 5 
CFR Sec. Sec.  2640.201-2640.203. Mr. Hopkins understands that the 
interests of the following persons and entities are imputed to him: his 
wife; minor children; general partner; any organization in which he 
serves as an officer, director, trustee, general partner or employee; 
and any person or organization with which he is negotiating, or has an 
arrangement concerning, prospective employment.
    Mr. Hopkins currently holds stock in General Electric and Johnson & 
Johnson. Mr. Hopkins has agreed that he will divest himself of these 
assets within 90 days of his confirmation. Further, pending his 
divestiture of this stock, Mr. Hopkins has agreed not to participate 
personally and substantially in any particular matters that will have a 
direct and predictable effect on the financial interests of either of 
these companies.
    These assurances resolve any concern about real or apparent 
conflicts of interest that may arise from Mr. Hopkins's report. 
Therefore, I have certified and dated the report.
            Sincerely yours,
                                            Walter A. Hall,
                                     Assistant General Counsel and 
                                 Designated Agency Ethics Official.

    Chairman Akaka. Thank you very much for your statement, Mr. 
Hopkins. We have some questions for you.
    Mr. Hopkins. Yes, sir.
    Chairman Akaka. My first question is dipping into your 
background. What leadership lessons have you learned from your 
over 30 years of military service and your 5 years of 
government service? What leadership lessons have you learned 
that will be of most use to you in this position?
    Mr. Hopkins. It is easy. One word, sir, teamwork. No person 
can do it alone. The areas that I have been responsible for 
require an extensive amount of organization and teamwork, to 
move the concepts, the plans, the policies and procedures to a 
place where they need to be to support emergency management, 
preparedness, and response and recovery. It is through 
teamwork, the way I build the coherent, solid teams, and the 
way we pull together, to move these programs forward. I have 
enjoyed some great successes, both while on active duty and 
certainly while at Treasury, IRS, and now FEMA.
    Chairman Akaka. Senator Craig and I have now been serving 
on this Committee and we have been moving and focusing on 
trying to bring about what we are calling seamless transition 
between DOD and VA. It is showing up as it is something that is 
really needed at this time, and what you just mentioned fits in 
that because we are looking at teamwork between DOD and VA to 
serve those who served our country. So I am glad to hear your 
response to that one.
    In reading your impressive resume, I notice that although 
you have years of experience in emergency preparedness and 
management, you do not have much background in either law 
enforcement or security. What do you view as the biggest 
challenges of assuming responsibility for VA's police service 
and Law Enforcement Training and Security Investigation Center?
    Mr. Hopkins. Sir, my background in security and law 
enforcement started when I was on active duty. My first job as 
a commissioned officer was weapons officer on board a nuclear 
submarine. The responsibility of the weapons officer was not 
only the torpedoes and sometimes the nuclear weapons in his 
charge, but also all the small arms, and for training the 
security force if a situation arose.
    Subsequent to that, my job at IRS was to develop a solid, 
coherent, and consistent security team throughout all the 800-
plus 
facilities throughout the IRS. I am proud to say that we had a 
wonderful record both while I was active duty and while I was 
at Internal Revenue Service.
    But for this specific job, the importance of this job for 
security and law enforcement is far-reaching. For all the VA 
facilities, the first person that our returning veterans will 
see--in many cases, the first person that they will see will be 
a member of the security and law enforcement team, and we all 
know, sir, you only get one chance to make a good first 
impression; and we all know that some of the folks returning 
from war have experienced some horrific things and the human 
effects are far-reaching.
    I want those experiences for those returning veterans that 
are seeking help from the Department of Veterans Affairs, I 
want that first impression to be a lasting and positive 
impression, not only for the security and law enforcement team, 
but, sir, they also represent the Department of Veterans 
Affairs. I want that solid first impression for them when they 
arrive.
    Again, the key to success in anything you do is the 
teamwork, consistent plans, consistent development of plans, 
policies, and procedures, and also a consistent training 
program, both an initial training program, boot camp, if you 
will, and an annualized recurring training program. Sir, if I 
am confirmed, one of the first things I will do is examine the 
entire training program for the security and law enforcement 
team, not only at the Law Enforcement Training Center, but the 
annualized recurring training that they will experience 
throughout the year. My intentions are to establish a constant, 
consistent policy for the security and law enforcement team to 
follow throughout all the VA facilities and be that positive 
first welcoming experience for all veterans and their families.
    Chairman Akaka. Thank you for your response.
    Senator Craig?
    Senator Craig. Mr. Chairman, many of your questions are 
those that I would have asked because I was curious regarding 
the relation to the ability of law enforcement officers to 
accommodate the needs of all veterans and especially the needs 
of veterans returning from OIF/OEF. So I will not pursue that 
any further.
    Let me ask this question, because obviously, if confirmed, 
you will serve as the first VA Assistant Secretary for 
Operations, Security, and Preparedness. How will you go about 
bringing the various offices under your authority together? I 
understand teamwork, but you are going to be in the process of 
creating a team----
    Mr. Hopkins. Sir, the unity of a team----
    Senator Craig [continuing]. From slightly diverse cultures 
under the same roof. How will you coordinate their efforts and 
bring them together?
    Mr. Hopkins. Sir, I have had an opportunity to talk to the 
current Assistant Secretary for Plans and Policies who 
currently is responsible for many of the areas that I would be 
responsible for, if confirmed. He has assured me that he has 
prepared a plan for turning over the watch, if you will. He is 
very anxious for me to get confirmed and take the helm.
    But having talked with him, I recognized that there is a 
common thread amongst my primary mission-responsible areas 
within the Office of Operations, Security, and Preparedness. 
Those common threads need to be pulled together. Those folks 
need to develop the solid teamwork. We need to understand where 
the common areas are that we would operate and how we would 
move forward as a team.
    I also recognize that these teams--these individual offices 
and their mission--there is a common thread through all the 
core competencies throughout the Department of Veterans 
Affairs. It is my intent, once I am confirmed, to review all 
the plans, policies, and procedures and compare them with the 
requirements that the Department of Veterans Affairs has 
established, find out where the gaps are, perform a gap 
analysis, and put a plan of action and milestones in effect to 
close those gaps; to provide the services that the veterans, 
their families, and the three administrations expect from an 
office that I would be responsible for.
    Senator Craig. Thank you very much.
    Mr. Chairman, I don't believe I have any further questions.
    Chairman Akaka. Thank you very much, Senator Craig.
    I want to tell you that we feel so fortunate that you are 
being considered for this and look forward to your being 
confirmed. For me, we will try to move this as quickly as we 
can----
    Mr. Hopkins. Thank you, sir.
    Chairman Akaka [continuing]. After the Committee votes on 
this.
    Do you have any further comments, Senator Craig?
    Senator Craig. I don't, Mr. Chairman. And again, let me 
thank you for the timeliness of this and moving this nominee 
expeditiously. We need to get him on the job.
    Thank you.
    Chairman Akaka. Well, thank you again, Mr. Hopkins, and 
your family. We are delighted that all of you were able to be 
here. Again, I want to wish you well. We need all the help we 
can get to help our veterans.
    Mr. Hopkins. Yes, sir.
    Chairman Akaka. Thank you very much.
    Mr. Hopkins. Thank you, sir. I am proud to serve.
    Chairman Akaka. The Committee is adjourned.
    [Whereupon, at 11:22 a.m., the Committee was adjourned.]


 HEARING ON THE NOMINATION OF PAUL J. HUTTER TO BE GENERAL COUNSEL OF 
                   THE DEPARTMENT OF VETERANS AFFAIRS

                              ----------                              


                      THURSDAY, SEPTEMBER 27, 2007

                                       U.S. Senate,
                             Committee on Veterans' Affair,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 9:24 a.m., in 
room 562, Dirksen Senate Office Building, Hon. Daniel K. Akaka, 
Chairman of the Committee, presiding.
    Present: Senators Akaka, Murray, Burr, and Isakson.

   OPENING STATEMENT OF HON. DANIEL K. AKAKA, CHAIRMAN, U.S. 
                      SENATOR FROM HAWAII

    Chairman Akaka. Aloha and good morning to everyone. The 
Committee will come to order.
    The Committee is here to consider the nomination of Paul J. 
Hutter to be VA's General Counsel. I am pleased to welcome Mr. 
Hutter and his family here today. Mr. Hutter, if confirmed, 
will be the Department's chief legal officer with very wide-
ranging and challenging responsibilities.
    I also want to say that I am happy to have our Ranking 
Member here, Senator Burr. I look forward to working closely 
together to help our Nation's veterans.
    Among those responsibilities is the need to ensure the 
effective implementation throughout the VA of all new 
legislation, as well as decisions from the U.S. Court of 
Appeals for Veterans Claims, and the U.S. Court of Appeals for 
the Federal Circuit; and those will be, of course, challenging 
responsibilities for you, Mr. Hutter.
    As I am sure you know, VA is frequently criticized for 
failing to disseminate new law throughout all levels of the 
Department, to include front-line adjudications. It will be 
very important for you to work with the Under Secretary for 
Benefits and the Chairman of the Board of Veterans Appeals to 
develop a cohesive approach to interpreting court decisions and 
updating the guidance issued to the field.
    I also look to you to define the role you believe the 
General Counsel plays in evaluating legislation, both 
introduced by Congress and proposed by VA for its legal 
sufficiency and its impact. While the various programs can 
provide incredibly valuable information on the intent, 
background, or implementation of a particular bill, it is vital 
for the General Counsel to provide an expert analysis on the 
legal implications.
    Related to the issue of the General Counsel's review of 
program policy initiatives and legislation is the role of the 
local Regional Counsels and their interaction with program 
personnel in the field. The General Counsel must send a clear 
message to the Regional Counsels that they must work with and 
support field program personnel. I urge you, Mr. Hutter, to 
ensure that all Regional Counsels adopt a full proactive type 
of interaction that will prevent problems and forestall 
litigation, rather than only getting involved after lawsuits 
are filed.
    The VA General Counsel also must play a very important role 
in advising the Secretary and Deputy Secretary as they deal 
with the many challenges that VA faces in providing timely, 
quality health care, timely and accurate adjudication of 
claims, and a lasting place of honor for our veterans. Assuming 
you are confirmed, I urge you to work closely with three VA 
Administrations and key staff offices to develop workable and 
viable plans that will enable VA to respond effectively to any 
emergency.
    Your many years of military service and your sense of 
experience in the Office of General Counsel and the supportive 
family that you have suggests that you have the qualifications 
for taking on the challenges of the Office of General Counsel. 
I plan to have the Committee act on your nomination as soon as 
feasible.
    Thank you so much for being here this morning and I would 
like to call on Senator Burr for his remarks.

        STATEMENT OF HON. RICHARD BURR, RANKING MEMBER, 
                U.S. SENATOR FROM NORTH CAROLINA

    Senator Burr. Aloha, Mr. Chairman.
    Chairman Akaka. Aloha.
    Senator Burr. I thank you for holding this hearing. Let me 
say at the start, Mr. Chairman, you have taken a fair, 
straightforward, bipartisan approach to holding hearings on the 
President's nominations, and more importantly, you have shown a 
willingness to move those nominations forward and fill 
important senior positions in the Department of Veterans 
Affairs. So, I just want to publicly thank you and encourage 
you, as you just stated, to expedite this nomination because, 
as you and I both know, we are going to be dealing with some 
other ones. And the faster we can clear our plate, the more we 
can focus on those.
    Next to the Secretary and the Deputy Secretary, there is no 
one else at the Department of Veterans Affairs whose job 
touches all aspects and operations of the VA like the General 
Counsel. I met Mr. Hutter earlier this month. I found him to be 
engaging and enthusiastic about this important job and I take 
great pleasure in giving his nomination my endorsement today.
    Mr. Hutter has not only built a career around serving 
veterans, Mr. Chairman, he is a veteran himself--having served 
30 years in the Judge Advocate General Corps, achieving the 
rank of Colonel. He has two sons who are currently aviators in 
the Navy. Maybe one of them is here?
    Mr. Hutter. Yes, sir.
    Senator Burr. Thank you for your service.
    Paul also worked in the private sector before being hired 
in 1992 at the VA. He has served as Acting Assistant Secretary 
for Policy, Planning, and Preparedness, Assistant General 
Counsel for Management Operations, and of course now as Acting 
General Counsel. Clearly, he is well qualified for the 
position.
    In many ways, Mr. Chairman, Paul is not as much being 
nominated for a new job as he is being promoted from within 
based upon the merits of his performance at other levels in the 
VA organization. You know, it is kind of nice to see a person 
come up through the ranks every once in a while and this is 
certainly one who has earned the nomination today.
    Paul, I look forward to your testimony. More importantly, 
I, as the Chairman stated, look extremely forward to an 
expedited process where this nomination can be taken to the 
Senate floor and out of this Committee.
    I thank the Chair.
    Chairman Akaka. Thank you very much, Senator Burr.
    I will shift gears so as to introduce the nominee to the 
Committee. I am delighted to note that Mr. Hutter has many ties 
to Hawaii. As you mentioned, Senator Burr, this family is a 
military family--not only Army, but now the Navy.
    Senator Burr. It makes for some interesting football games.
    [Laughter.]
    Chairman Akaka. Mr. Hutter was born in Tripler Army 
Hospital in Honolulu while his father was stationed at 
Schofield Barracks. His dad served in World War II and in Korea 
and Vietnam, as well. Mr. Hutter attended high school in Hawaii 
and graduated from Punahou School in 1972.
    After college, he returned to Hawaii in 1976 where he also 
was stationed at Schofield Barracks. In the late 1980's, 
following the end of his Army service, Mr. Hutter again 
returned to Hawaii, where he practiced law until he joined the 
Department of Veterans Affairs in 1992.
    While your nomination form may say you are from Virginia, 
with that background, I think Hawaii has a claim there also.
    Mr. Hutter joined VA's Office of General Counsel in 1992 
after his retirement from a long career of military service, 
first as an infantry officer and then, following graduation 
from law school, as a member of the Judge Advocate's General 
Corps. He has served as Acting General Counsel since August of 
last year.
    Mr. Hutter's wife, Mary, their son, Ian, and Mr. Hutter's 
parents, Dean and Helen, are here with us for this very special 
event.
    I want to thank you again and say mahalo nui loa for coming 
before us today, Mr. Hutter. To the Hutter family, as we say in 
Hawaii, E komo mai, or welcome to our hearing.
    And now as is the rule here, I will now administer the oath 
to you that all nominees take during their confirmation 
hearing, and we will then be ready to hear your statement. So, 
will you please rise and take the oath.
    Do you solemnly swear that the testimony you are about to 
give the Veterans' Affairs Committee, as well as other 
information submitted to the Committee, will be the truth, the 
whole truth, and nothing but the truth, so help you God?
    Mr. Hutter. I do.
    Chairman Akaka. Let the record show that the witness did 
answer in the affirmative.
    Mr. Hutter, will you please begin with your statement.

 STATEMENT OF PAUL J. HUTTER, NOMINATED TO BE GENERAL COUNSEL, 
              U.S. DEPARTMENT OF VETERANS AFFAIRS

    Mr. Hutter. Mahalo, Mr. Chairman, Senator Burr, good 
morning. Thank you for the opportunity to testify today. I am 
honored and humbled to be nominated by President Bush to serve 
as General Counsel at the Department of Veterans Affairs. I am 
also most grateful to Secretary Jim Nicholson and Deputy 
Secretary Gordon Mansfield for their confidence in me.
    Mr. Chairman, service to veterans is the cornerstone of our 
practice in the Office of General Counsel. We do not often have 
the privilege, however, of direct interaction with veterans, 
but realize every day that our legal advice has an impact on 
the service that our administrations and staff offices provide 
to our beneficiaries. We work hard to ensure that our advice 
provides every possible advantage to our veterans.
    During the past 15 years, it has been my honor to serve in 
VA's Office of General Counsel as appellate attorney (staff 
attorney), and in leadership positions in the field and at the 
headquarters. In addition, I served for 30 years in the United 
States Army and the Army Reserve as, as you have said, an 
Infantry Officer and Judge Advocate. As a Judge Advocate, I 
supervised lawyers in the capacity of a staff officer (staff 
judge advocate), and as a commander.
    As you have alluded, and so kindly, Mr. Chairman, I am 
privileged to be the son of a career infantry officer and 
veteran of World War II, Korea, and Vietnam. I am also proud 
that two of my three sons are currently serving as Naval 
aviators, as you alluded to, Senator, one flying helicopters in 
San Diego and the other navigating F/A 18s in Oceana.
    As the result of my family's service in the military and my 
experience in the Army and the Department of Veterans Affairs, 
I have developed a deep respect for the personnel who serve in 
our Armed Forces and their families. Time and time again, they 
display the honor, courage, and commitment that make our Armed 
Forces the greatest in the world. As time marches on, they, 
too, will become veterans and I am inspired by them to continue 
to tackle the challenges of the mission of the Department of 
Veterans Affairs, to care for him who shall have borne the 
battle, and for his widow and orphan.
    If confirmed, I look forward to continuing my work with the 
team of professionals at the Department of Veterans Affairs to 
accomplish that mission. I am confident that my legal and 
leadership experience has given me the skills to lead, advise, 
and contribute effectively.
    I continue to learn and act on the many issues that are of 
concern to our veterans. The General Counsel provides advice 
and counsel to the Deputy Secretary, the Secretary, and other 
senior leaders concerning all matters--legal matters--involving 
the Department. The General Counsel also ensures the quality, 
timeliness, and accuracy of VA's legal staff in the field.
    If confirmed, I will continue to work these issues facing 
the Department and give my very best effort to diligently and 
faithfully advise the Deputy Secretary and the Secretary.
    Again, I am very proud to have my parents, Dean and Helen, 
my wife, Mary, my son, Ian, here. I am very grateful for their 
constant support and love.
    Thank you again, Mr. Chairman and Members of the Committee, 
for your consideration of my nomination. I would be happy to 
answer any questions you may have, and I would ask that this 
statement be entered into the record.
    [The prepared statement of Mr. Hutter follows:]
  Prepared Statement of Paul J. Hutter, Nominee for General Counsel, 
                     Department of Veterans Affairs
    Mr. Chairman, Senator Burr, and Members of the Committee, good 
morning. Thank you for the opportunity to testify today. I am honored 
and humbled to be nominated by President Bush to serve as General 
Counsel at the Department of Veterans Affairs. I am also most grateful 
to Secretary Jim Nicholson for his confidence in me.
    Service to veterans is the cornerstone of our practice in the 
Office of General Counsel. We do not often have the privilege of direct 
interaction with our veterans, but realize that our legal advice has an 
impact on the service that our clients provide. We work hard to ensure 
that our advice provides every possible advantage to our veteran 
beneficiaries.
    During the past 15 years, it has been my honor to serve in VA's 
Office of General Counsel as appellate attorney, staff attorney and in 
leadership positions in the field and at the headquarters. In addition, 
I served for 30 years in the United States Army and the Army Reserve as 
an Infantry Officer and Judge Advocate. As a Judge Advocate, I 
supervised lawyers in the capacity of staff officer and commander.
    I am privileged to be the son of a career infantry officer and 
veteran of World War II, Korea and Vietnam. I am also proud that two of 
my three sons are currently serving as Naval Aviators--one flying 
helicopters and the other navigating F/A 18s.
    As the result of my family's service in the military, and my 
experience in the Army and the Department of Veterans Affairs, I have 
developed a deep respect and appreciation for the personnel who serve 
in our Armed Forces--and their families. Time and again they displayed 
the honor, courage and commitment that make our Armed Forces the 
greatest in the world. As time marches on, they too will become 
veterans.
    I am inspired by them to continue to tackle the challenges of the 
mission of the Department of Veterans' Affairs--``To care for him who 
shall have borne the battle and for his widow and orphan.'' If 
confirmed, I look forward to continuing my work with the team of 
professionals at the Department of Veterans Affairs to accomplish that 
mission. I am confident my legal and leadership experience has given me 
the skills to lead, advise and contribute effectively.
    I continue to learn and act on the many issues that are of concern 
to our veterans. The General Counsel provides advice and counsel to the 
Deputy Secretary, the Secretary and other senior leaders concerning all 
legal matters involving the Department. The GC also ensures the 
quality, timeliness and accuracy of the work of VA's legal staff in the 
field. If confirmed, I will continue to work the issues facing the 
Department and give my very best effort to diligently and faithfully 
advise the Secretary and Deputy Secretary.
    With me today are my wife, Mary; my parents, Dean and Helen; and my 
son, Ian. I am very grateful for their constant love and support.

    Thank you again, Mr. Chairman and Members of the Committee, for 
your consideration of my nomination. I would be happy to answer any 
questions you may have.

    [The Committee questionnaire for Presidential nominees from 
Mr. Hutter follows:]




    [A letter from the Office of Government Ethics follows:]

    
    
                                ------                                

Response to Pre-Hearing Questions Submitted by Hon. Daniel K. Akaka to 
  Paul J. Hutter, Nominee for General Counsel, Department of Veterans 
                                Affairs

    Question 1. What are your overall goals for the Office of General 
Counsel (OGC) should you be confirmed?
    Response. My goal is to make the Office of General Counsel into a 
``force multiplier'' that avoids and solves problems in the Department, 
and provides the guidance and representation necessary to allow our 
employees to effectively and lawfully carry out their missions. Each of 
our lawyers must understand our clients' business lines well enough to 
provide intelligent and creative support for ongoing business needs and 
new projects. We must overcome issues in partnership with our clients 
at all levels of the Department.
    Accompanying my response to this question is a one-page outline 
that more clearly identifies my vision for the Office of General 
Counsel and the overarching requirements to meet that vision. The 
elements of that vision statement include:

     Proactivity--engaging issues as early as possible to avoid 
more difficult legal consequences as projects develop;
     National presence--our clients and stakeholders must know 
where we are, how to reach us and what we can do for them throughout 
the country, in Puerto Rico and throughout the Pacific Rim.
     Unity--the substance, quality and timeliness of the advice 
and representation we provide is consistent, nationwide.

    I have drafted a strategic plan for the Office of General Counsel 
that amplifies these principles. The intent of the plan is to look out 
10 years, align our practice with the Department's strategic plan and 
priorities, and adjust the organization to meet those requirements. I 
have sent this draft to my managers throughout the country and will 
publish the plan in November.
    As an example--and consistent with Departmental requirements--we 
have trained additional lawyers to address contracting issues across 
the Department--to ensure legal support for headquarters and field 
organizations in each of the Administrations. This is consistent with 
our goal to solve legal issues at the earliest possible time and at the 
location closest to our clients.

    Question 2. What are the present size, makeup, and organization of 
OGC? If confirmed, do you anticipate making any changes in the overall 
organizational structure, either in the Central Office or in the field?
    Response. OGC nationwide is currently comprised of 677 ``full-time-
equivalent employees'' (FTEE) of whom 402 are attorneys. 266 of these 
677 employees are in OGC headquarters (VA Central Office) and 411 are 
in our 22 field offices (Offices of Regional Counsel).
    As the attached organizational chart shows, a single Deputy General 
Counsel reports to the General Counsel. Seven Assistant General 
Counsels, each of whom leads a professional staff (Professional Staff 
Group or ``PSG''), report through the Deputy to the General Counsel. 
Our 22 Regional Counsels report through the Assistant General Counsel 
for PSG VI to the Deputy General Counsel and General Counsel.
    One of the PSGs (VI) has nationwide office management-and-
operations responsibilities and each of the other PSGs specializes in 
the many different specialties of VA legal practice.
    This relatively flat organizational structure has proven effective. 
I remain convinced it affords an appropriate span of control for 
organizational managers, and our annual surveys continue to indicate 
high levels of client satisfaction with our services. Accordingly, our 
offices effectively balance the need for centralized guidance with that 
of providing timely, proactive service to our clients throughout the 
country.

    Question 3. What is the relationship between OGC and the Secretary, 
other top staff officials, and the heads of the administrations? Do you 
see the General Counsel as having an active role in helping these 
various officials craft appropriate policy and carry out their 
responsibilities or do you see OGC as a resource that is available to 
these officials if they choose to utilize the expertise of the office? 
If confirmed, do you anticipate making any changes in these 
relationships?
    Response. As Acting General Counsel and in my observation of 
previous General Counsels' interactions with VA leadership, it has 
become clear to me that OGC is considered a valuable resource to be 
drawn upon early and often in all types of situations involving 
important operational and policy issues. I continually impress upon our 
clients the importance of our participation early in the consideration 
of matters to ensure that legal ramifications are factored into 
decisionmaking. In my experience there is widespread appreciation among 
departmental leadership--at all levels of the organization--of the 
value that OGC adds to discussions and reviews of virtually all 
significant VA issues, and we are regularly consulted and invited to 
participate in top-level meetings. If I were ever to experience a need 
to interject OGC into consideration of matters, as General Counsel, I 
would not hesitate to do so.
    An advantage of serving as Acting General Counsel is that it has 
allowed me to establish good levels of trust and strong working 
relationships with leaders of all of the administrations and staff 
offices. I am gratified by their acceptance of me and their deep 
appreciation of our office.

    Question 4. What is the working relationship between field offices 
of OGC and of the administrations? Is there a direct client 
relationship between OGC personnel in the field and local managers of 
VHA, VBA and NCA? In how many facilities are OGC employees collocated 
with field managers of the administrations? If confirmed, do you 
anticipate making any changes in these relationships?
    Response. The mission of our Offices of Regional Counsel is to 
furnish the legal support needed by VA-program officials to provide 
world-class service delivery to veterans across the United States. Our 
Regional Counsels serve as house counsel to directors of all VHA, VBA 
and NCA field facilities, working closely with facility officials to 
meet their everyday needs for legal advice and representation. They 
forge close attorney-client relationships by participation in regularly 
scheduled meetings (for example, of VISN-level Executive Leadership 
Committees) and through frequent, daily communications. While the 
Professional Staff Groups in VACO are available to them as expert 
resources, our Regional Counsels provide the direct legal support their 
clients have come to rely upon. Client surveys have shown very high 
levels of satisfaction with Regional Counsel services.
    In all but one of our field offices, Regional Counsel staff are co-
located in facilities with leadership of one or more VA 
administrations. In all of our offices, our Regional Counsels are no 
more than short drives from program leaders and maintain close contact 
with them. As a former field leader myself I know first-hand the 
importance of maintaining strong client relations, and I will emphasize 
the importance of doing so if my nomination is confirmed.

    Question 5. What is your view on the role of OGC in responding to 
decisions of the Court of Appeals for Veterans Claims, the Federal 
Circuit, and the Supreme Court? Is it OGC's function to interpret such 
decisions? Does OGC advise the Secretary, the board of Veterans 
Appeals, and the administrations about the meaning of such decisions? 
Does OGC have a role in ensuring compliance by BVA and VBA with such 
decisions? What is OGC's role in deciding whether a particular decision 
should be appealed? If confirmed, do you anticipate making any changes 
in OGC's role in this area?
    Response. The General Counsel is the Department's chief legal 
officer, responsible for ensuring that VA-program officials fully 
understand the laws and regulations in order that they may accord 
veterans every benefit and service to which they are entitled. Since 
the advent of judicial review, the General Counsel's role has grown to 
include definitive interpretations of court rulings to guide Board of 
Veterans Appeals (BVA) and VBA adjudicators.
    OGC is frequently consulted by both BVA and VBA as new court 
decisions are issued. Moreover, OGC years ago instituted regular 
``Triad'' meetings with VBA and BVA officials at which new court 
decisions are thoroughly discussed to ensure common understanding of 
their meaning. Formal precedent opinions of the General Counsel are 
issued whenever necessary to definitively state the ``holdings'' of 
court decisions for the benefit of VA adjudication personnel who apply 
them.
    OGC plays the principal role in deciding which court decisions VA 
will ask the Department of Justice to appeal. These recommendations are 
made only when the General Counsel is convinced a court has 
misinterpreted the intent of Congress regarding a statute, 
misinterpreted a regulation VA has itself promulgated, or misapplied 
binding judicial precedent. These recommendations are vetted with VA-
program offices and there is consultation with the Deputy Secretary and 
the Secretary as appropriate. I believe the current approach to appeal 
recommendations is sound and I do not anticipate making any changes if 
I am confirmed.

    Question 6. What is the role of OGC in preparing and clearing 
testimony that is being presented to committees of Congress? On 
preparing and submitting legislation to Congress? On preparing or 
approving VA regulations? If confirmed, do you anticipate making any 
changes in OGC's role in this area?
    Response. OGC prepares draft legislation and legislative testimony 
for OMB clearance and submission to Congress. VA draft bills are 
prepared and presented in order to advance the Secretary's legislative 
agenda. Testimony on pending legislation is also prepared to reflect 
the Secretary's views.
    OGC's role in the preparation of oversight-hearing testimony is 
generally more limited. Ordinarily, that testimony is prepared by the 
program offices and OGC's role is limited to reviewing it for legal 
sufficiency.
    OGC's role in rulemaking varies with the subject of the rule. In 
some cases, such as with the rule to implement the new attorney-fee 
provisions of Public Law 109-461, OGC assumes the principal drafting 
role. Ordinarily, however, OGC participates in drafting only as 
requested by the issuing program office or by the Office of Regulatory 
Policy and Management, which has overall responsibility for 
coordinating the preparation of VA regulations and their clearance by 
OMB's Office of Information and Regulatory Affairs. OGC is consulted 
throughout the process, however, and in all cases the General Counsel's 
concurrence is required before rulemaking packages are submitted to the 
Secretary for approval.
    I am comfortable that these processes permit appropriate OGC 
participation and currently do not have plans for recommending changes 
in them.

    Question 7. In your view, how effective is the current system for 
the adjudication of claims for VA benefits, to and through the courts? 
What do you see as the role of OGC in efforts to address the backlog of 
claims and to otherwise improve the claims adjudication system? Do you 
have any views for how the system might be improved?
    Response. The best measure of effectiveness of the current process 
is the end result for veterans: are they ultimately able to gain the 
benefits claimed, to the extent they are entitled? By that measure, the 
current system is effective. It is rare to encounter a situation in 
which a veteran, having exhausted the many avenues for redress afforded 
by the process, has been denied benefits to which he or she is 
entitled. This indicates to me that reasonable doubt is being resolved 
in claimants' favor, and that VA personnel are broadly construing 
claims to claimants' benefit.
    In terms of addressing the current claims backlog, I believe OGC 
can have positive influences in a number of respects. First, we can 
ensure that sufficient resources are devoted to representing the 
Secretary before the Court of Appeals for Veterans Claims so that 
litigation there is not unnecessarily protracted. I have made that a 
resourcing priority, and will continue to do so if confirmed.
    Second, OGC needs to ensure that the interpretations of benefit 
laws, regulations and court precedents are consistently understood by 
VBA and BVA so veterans need not appeal in order to obtain the benefit 
of a correct application of the law to their cases. We strive to 
promptly advise program officials of new developments in the law so 
they are kept current.
    Finally, we advise VBA program officials, including those in the 
Compensation and Pension Service, on a very frequent basis concerning 
the most efficient manner to implement such authorities as the Veterans 
Claims Assistance Act so as not to unnecessarily prolong adjudications 
and to avoid backlog-compounding remands.
    From my vantage, I believe VBA is going about tackling these issues 
in the right way: by staffing up considerably, and by ensuring staff 
are adequately trained to apply the increasingly complex law to its 
burgeoning caseload.

    Question 8. What is your view on when OGC should issue a General 
Counsel Opinion that establishes binding precedent for the Department? 
What process is followed in the development of such opinions? If 
confirmed, do you anticipate making any changes in when or how OGC 
issues General Counsel opinions?
    Response. Precedent opinions of the General Counsel are usually 
issued at the request of either VBA or BVA in order to ensure that a 
common interpretation of the law guides benefit-claim consideration 
throughout the Department. On occasion OGC has issued them ``on its own 
motion'' when it has encountered situations in which ambiguities or 
vagueness in laws or judicial decisions could lead to disparate 
interpretations.
    Assignments to draft these opinions are made to the Professional 
Staff Group having jurisdiction for the particular subject matter. Once 
drafted, they are reviewed up the chain of command within OGC for 
approval by the General Counsel.
    I do not anticipate any changes in these regards if I am confirmed 
as General Counsel.

    Question 9. As you know, the Committee received a letter in 
connection with your nomination relating to a personnel matter that you 
were involved with, both during your time in the Office of Policy, 
Planning and Preparedness and in OGC. Without discussing the specifics 
of that personnel matter, please indicate:

    (a) How the decision was made to refer the matter to an 
administrative investigation board (AIB);
    (b) Why the decision was made to ask an official from outside of VA 
to head the AIB;
    (c) Whether you have received any information or formal 
communication suggesting that utilizing an outside official to head the 
AIB was not appropriate or legal?
    Response.
    (a) An employee in the Office of Policy, Planning and Preparedness 
came to me as the Acting Secretary and asked that I address an 
extensive list of employment-related complaints that spanned the 
employee's career at VA. The only way to effectively determine the 
facts and the proper remedies (if appropriate) was to commission an 
administrative investigation board to engage in fact-finding, and to 
provide conclusions based on the facts.
    (b) Several of the complaints raised by the employee involved the 
most senior staff members in the Department. Accordingly, to ensure the 
objective and complete investigation of the employee's concerns, we 
asked the Department of Justice to provide an attorney to conduct the 
Administrative Investigation Board.
    (c) We have received no information from the Department of Justice 
or other agency that our use of an outside official was inappropriate 
or illegal. We have been told that the employee's husband received a 
communication from the Department of Justice concerning his complaint 
about the investigation. Neither the employee nor her husband shared 
this communication with us.
             Attachment to Accompany Pre-Hearing Questions



                                 ______
                                 
Response to Post-Hearing Questions Submitted by Hon. Daniel K. Akaka to 
  Paul J. Hutter, Nominee for General Counsel, Department of Veterans 
                                Affairs
    Question 1. Should VA have another data security breach, similar to 
the May 2006 incident, do you have a clear idea of what the General 
Counsel's role is in VA's response?
    Response. Yes. In such an event, the Office of General Counsel 
(including local Regional Counsels) would work closely with local and 
national Incident Response Teams, and as members of the Incident 
Resolution Core Team, and provide timely legal advice as needed to the 
Office of the Secretary, the Chief Information Officer, and the 
impacted program office(s) to ensure that the Department addresses and 
mitigates the incident in accordance with all applicable laws. In 
particular, title IX of the Department of Veterans Affairs Information 
Security Enhancement Act of 2006, Pub. L. No. 109-461, and implementing 
regulations in Part 75 of 38 C.F.R., effective June 22, 2007, provide a 
framework for action in response to a data breach involving sensitive 
personal information.

    Question 2. In the event of a significant data breach, risk 
analysis plays a critical role in how VA will respond. What is your 
understanding of the role the General Counsel plays in VA's risk 
analysis process?
    Response. The VA Information Security Enhancement Act of 2006 
mandates that in the event of a breach of sensitive personal 
information, VA must ensure that, as soon as possible after the breach, 
a non-Department entity or the VA Office of the Inspector General 
conducts an independent risk analysis to determine the level of risk 
for the potential misuses of sensitive personal information. 
Thereafter, if the Secretary determines, based on the findings of the 
independent risk analysis, that a reasonable risk exists for the 
potential misuse of sensitive personal information, the Secretary shall 
provide credit protection services in accordance with VA regulations 
promulgated at 38 C.F.R. Part 75, Subpart B. The Office of General 
Counsel's role would be to proactively advise and otherwise assist the 
Department leadership to ensure that the risk-analysis process and 
resulting VA actions comport with these legal authorities.

    Question 3. Do you believe that HIPAA presents an obstacle to the 
transfer of medical information between DOD and VA? And if so, how can 
any such obstacle be overcome?
    Response. No, the HIPAA Privacy Rule is not a barrier to VA/DOD 
medical information sharing.
    The HIPAA Privacy Rule generally prohibits the nonconsensual 
disclosure of protected health information (PHI). The Rule, however, 
includes a special exemption pertaining to the disclosure of PHI upon 
the separation or discharge of an individual from military service. 
This exception, 45 C.F.R. Sec. 164.512(k)(1)(ii), allows DOD to 
``disclose to VA the protected health information on an individual who 
is a member of the Armed Forces upon separation or discharge of the 
individual from military service for the purpose of a determination by 
VA of the individual's eligibility for or entitlement to benefits under 
laws administered by the Secretary of Veterans Affairs.'' Furthermore, 
VA may disclose PHI to military command authorities without an 
authorization if a VA patient is a member of the Armed Forces and 
military command authorities need the PHI to assure the proper 
execution of the military mission. 45 C.F.R. Sec. 164.512(k)(1)(i). 
Hence, I do not view the HIPAA Privacy Rule as an obstacle.

    Question 4. Early in your tenure in the Office of General Counsel, 
you were in Group Seven, the section that works on appeals before the 
Court of Appeals for Veterans Claims.

    (a) Are you satisfied that the head of that section has sufficient 
authority to settle, rather than appeal, an individual case?
    Response. Yes, I believe the head of that staff possesses 
sufficient authority to settle cases coming before the Court of Appeals 
for Veterans Claims (``Veterans Court''), either by agreement to remand 
the appeal or to award the benefits at stake. As a matter of practice, 
that group's attorneys take a fresh, objective look at each case that 
is filed in the Veterans Court. They do not automatically defend every 
BVA decision presented in an appeal. Instead, where it appears that a 
potentially harmful error has been made, or where a change in law 
requires readjudication, the Secretary's attorneys offer to remand or 
otherwise settle the case, as appropriate. This is consistent with 
well-established principles, dating back over a century, regarding the 
Government's authority to terminate lawsuits by settlement or 
compromise.
    Indeed, that office has a special team of experienced attorneys 
charged with ``triaging'' every new appeal that is filed to determine, 
as early as possible in the litigation, whether remand or other 
settlement is warranted. If defense of the BVA decision is not 
appropriate in their judgment, they have the ability to resolve the 
appeal within a matter of weeks rather than in the many months required 
to fully litigate a typical appeal. This approach is justified by the 
desire to see that justice is done and that veterans' cases be handled 
as quickly and efficiently as possible.

    (b) I realize that the attorneys in that section must have 
expertise in handling appeals, but I believe that there would be value 
in ensuring that attorneys familiar with specific VA programs also work 
in that office. Does Group Seven bring in attorneys, with subject 
matter expertise, from elsewhere in the Office of General Counsel?
    As your question recognizes, the wide variety of benefit questions 
that arise in cases coming before the Veterans Court can be 
challenging. Our appellate-litigation group brings the special 
expertise of program officials and others to bear by consulting the 
experts while the litigation position of the Secretary is being 
formulated. Specifically, it is part of their standard operating 
procedures to consult with attorneys in other OGC groups that have 
particular expertise in the area of the law and the program at issue in 
an appeal. They also involve these specialists in reviewing their 
briefs and in their moot courts in preparation for oral argument. 
Additionally, our Veterans Court litigation staff will consult with 
officials in the specialized program area, such as the Compensation and 
Pension Service, Education Service, Loan Guaranty Service, Insurance 
Service, etc., as appropriate. This network of experts that our 
attorneys use--as the private sector employs expert witnesses and 
consultants--has proven very useful in guiding our attorneys in 
litigation before the Veterans Court.

    Question 5. Do Regional Counsels have sufficient authority to 
settle suits brought against VA, such as for medical malpractice?
    Response. While only the United States Attorneys and the Department 
of Justice are authorized to settle suits in litigation against the 
Government under the Federal Tort Claims Act, VA Regional Counsels and 
VA attorneys in the tort section of the Office of General Counsel in 
Washington have authority to settle pre-litigation administrative tort 
claims, including those alleging medical malpractice. Regional Counsels 
have authority to settle tort claims in an amount not exceeding 
$100,000. They may, however, obtain additional authority in a 
particular case up to $200,000, the limit of the Department's 
authority, from the torts section of the Office of General Counsel 
(OGC) in Washington. This approval can be obtained relatively quickly 
and with minimum formality, consistent with verification that the 
recommended settlement is justified and reasonable.
    Under this arrangement, I believe that our Regional Counsels have 
sufficient settlement authority, and our statistics bear that out. For 
Fiscal Year 2007 through the end of July, of the 262 total payments in 
VA medical malpractice cases, both in litigation and administratively, 
Regional Counsels settled 96 claims, 36 percent of the total, within 
their $100,000 authority. Another 33 malpractice claims were settled 
either by Regional Counsels with additional authority from OGC or by 
the OGC tort section attorneys within the Department's $200,000 
authority. The OGC tort section may also settle cases in excess of 
$200,000, subject to approval by the Department of Justice, and did so 
in eleven cases in fiscal year 2007. In all, OGC administrative 
settlements comprised 53 percent of the total number of payments in VA 
medical malpractice cases.

    Question 6. The Institute of Medicine last month issued a report on 
the establishment of presumptions for service connection. What role 
does the Office of General Counsel play in determining whether a 
specific disease or illness should be presumed service-connected?
    Response. Although most existing presumptions of service connection 
have been established by Congress, VA has authority to establish 
presumptions of service connection for specific diseases and illnesses 
by regulation, and the General Counsel plays an important role in that 
process. Determining whether a presumption is warranted involves a 
combination of scientific, policy, and legal considerations, requiring 
collaborative efforts between the Veterans Health Administration, the 
Veterans Benefits Administration, and the Office of the General 
Counsel. The General Counsel is primarily responsible for ensuring that 
a presumption is within VA's authority, that the basis for the 
presumption is legally adequate and sufficiently explained, and that 
the presumption is properly established through rulemaking procedures. 
Two statutes--the Agent Orange Act of 1991 and the Persian Gulf War 
Veterans Act of 1998--establish standards and procedures under which VA 
must determine whether presumptions are warranted for specific diseases 
or illnesses associated with herbicide exposure or hazards of Gulf War 
service. To carry out those requirements, the General Counsel serves on 
a Task Force with other VA officials to evaluate reports prepared by 
the National Academy of Sciences and to make recommendations to the 
Secretary as to whether the available medical and scientific evidence 
warrants a presumption of service connection for any disease or illness 
under the legal standards set forth in those statutes.

    Question 7. The Committee has a strong interest in improving 
collaboration and cooperation between VA and DOD. As far as you know, 
are there any existing legal impediments to the two Departments 
engaging in comprehensive sharing?
    Response. As you know, 38 USC Sec. 8111 gives VA and DOD broad 
authority to share health-care resources. The statute also calls for an 
annual report to Congress by the two Secretaries in which they are to 
provide recommendations for any needed amendments to this authority. I 
am presently not aware that additional sharing authority is needed, but 
as collaboration between the two Departments grows we very well may 
identify such a need. I certainly appreciate your implied offer to 
assist us in that event.

    Question 8. In recent years, there have been situations in which a 
significant issue has been under review by the Court of Appeals for 
Veterans Claims or, after appeal from that court, by the Court of 
Appeals for the Federal Circuit. Meanwhile, claims involving the same 
issue continue to come to VA. Do you have any recommendation on how to 
manage claims that are pending a court decision?
    Response. Occasionally it can be forecast that the resolution of a 
matter on appeal to the Federal Circuit will affect the adjudication of 
so many pending claims that it is prudent to defer those adjudications 
until the Federal Circuit has ruled. A good example involved the 
Veterans Court's ruling that veterans whose tinnitus is perceived 
bilaterally are entitled to 20 percent disability ratings rather than 
the 10 percent VA had traditionally assigned this condition. Convinced 
that the court had committed error, VA ``stayed'' the application of 
the ruling to other cases while the Department of Justice appealed it 
to the Federal Circuit, which ultimately agreed with VA's 
interpretation of its regulations. Had VA not stayed the adjudications 
and instead promptly applied the CAVC's ruling to pending cases, it 
would have later had to reduce all of those ratings to 10 percent which 
would certainly have created confusion among veterans, unduly burdened 
the claims system to the disadvantage of other claimants, and perhaps 
required creation and collection of resulting overpayments.
    It is possible as you suggest that an issue on appeal to CAVC could 
also create a need for VA to temporarily forebear adjudications that 
would be controlled by the appeal's outcome so as to avoid unnecessary 
reworking of those claims.
    Current Veterans Court case law requires VA to obtain a court order 
authorizing it to stay adjudications in such circumstances. As General 
Counsel I would not hesitate to petition for such orders as appropriate 
on behalf of the Secretary.

    Question 9. With ever increasing numbers of older veterans in VA 
long-term care facilities, do Regional Counsels have any role in 
working with these veterans to assist them with estate planning or 
referring them to local attorneys who might provide such assistance?
    Response. The Office of the General Counsel provides legal 
assistance to the Secretary, and by extension to the Administrations 
and Staff Offices, concerning the programs and policies of the 
Department. Office of General Counsel attorneys, paralegals and staff 
are not authorized to provide legal assistance directly to veterans, 
although they regularly direct veterans requiring assistance to local 
legal services such as pro bono and reduced-fee programs. They also 
advise veterans to check with the nearest military installation to 
determine whether they are entitled to receive legal-assistance 
services from military judge advocates.

    Chairman Akaka. Thank you very much, Mr. Hutter.
    We do have questions. Earlier this year, I wrote to 
Secretary Nicholson about the proposed regulation on 
accreditation of agents and attorneys, specifically with 
reference to the requirement that all attorneys pass a VA-
administered written examination prior to accreditation. In 
late August, Secretary Nicholson indicated that VA was 
reconsidering the examination requirement. Can you provide an 
update on the status of the proposed regulation?
    Mr. Hutter. Yes, I can, Mr. Chairman. We received your 
letter and gave it a great deal of thought. Your letter 
indicated that you and Senator Craig, who jointly signed the 
letter, were concerned that the testing requirement that we had 
built into the proposed regulation would chill the efforts of, 
particularly, pro bono law firms in representing our veterans.
    We have considered that very carefully. We have crafted an 
alternate solution that is working its way through the 
concurrence process at the VA and we expect to have a final 
regulation by the end of next month.
    Chairman Akaka. It is clear, Mr. Hutter, that VA, like all 
Federal departments and agencies, is facing a great many 
questions relating to the increasing use of information 
technology. Are you satisfied that the Office of General 
Counsel has sufficient staff attorneys with expertise in this 
emerging area of law?
    Mr. Hutter. Yes, Mr. Chairman, we are. We are privileged to 
have three experts on our headquarters staff who have not only 
expertise in the law, but have extensive expertise in 
information technology and information management. We also have 
several assets in the field who share that dual interest in the 
law and information management and we are making full use of 
them at this time because of the many challenges that face the 
Department in this area.
    Chairman Akaka. In your responses to my pre-hearing 
questions, you described the Office of General Counsel's role 
in clearing testimony. I realize that there is only so much 
that the Office of General Counsel can do, but I urge you to 
work with others in VA to help ensure that VA testimony is 
received more timely. The current situation where the Committee 
may not receive cleared testimony until late the day before a 
hearing must end. With Senator Burr, we have some feelings 
about that.
    With respect to the current claims adjudication system, I 
ask that if you are confirmed, your Office of General Counsel 
staff work with the Board in VBA to find possible changes to 
law, regulation, internal guidance, or practice that can 
improve the timeliness of the process. The status quo is simply 
unacceptable.
    In your answer to my pre-hearing question about how VA 
responds to decisions of the U.S. Court of Appeals for Veterans 
Claims and other courts, you noted that OGC works with BVA and 
VBA on understanding decisions. While I appreciate the value of 
collegial cooperation, I believe that there must be a single 
office within VA with the responsibility for interpreting court 
decisions and ensuring that those interpretations are shared 
throughout the Department. In my view, that should be the 
Office of General Counsel. Do you agree with that?
    Mr. Hutter. Mr. Chairman, I do agree with that, and if 
confirmed, I will work with my colleagues, Admiral Cooper and 
Chairman Terry, to take the leadership in that role and ensure 
that the interpretation of the decisions and the downstream 
effect of those decisions are promulgated as you said, to the 
field, to the people who need it in order to craft their 
decisions and provide timely benefits responses to our 
veterans.
    Chairman Akaka. I would ask you to please let me know if 
there are any problems preventing this policy.
    Mr. Hutter. I will let you know, sir.
    Chairman Akaka. Let me call on Senator Burr for his 
questions.
    Senator Burr. Thank you, Mr. Chairman.
    Mr. Hutter, let me reemphasize something that the Chairman 
touched on and that is testimony. I am sure that the General 
Counsel's Office is involved in clearing the testimony, as are 
other areas of the Administration. Leave here with every 
understanding that, if the policies don't change, we will find 
a way to further encourage compliance, and I am serious about 
that one and it is not just limited to this Committee. It is 
really pointed at the Administration and previous 
Administrations and future Administrations, that this will 
change. It has to change.
    Let me also follow up on an area that the Chairman just 
raised, which is the number of incoming appeals for the Court 
of Appeals for Veterans Claims. Specifically, are there other 
steps, like mandatory mediation, that could be taken to help 
your office and the court handle this tremendously high 
caseload?
    Mr. Hutter. Senator, the problem with mediation in the 
environment of the Court of Appeals for Veterans Claims is that 
these are statutory and regulatory benefits. Either a veteran 
is entitled to those benefits or the veteran is not. So it is 
very difficult to mediate those benefits because of that clear 
disposition as to either he or she is authorized or not 
authorized.
    But what we can do, Mr. Chairman and Senator Burr, is to 
identify those cases early on that come to us from the Court of 
Appeals for Veterans Claims that can easily be disposed. Either 
they should be granted and we either remand or we grant the 
benefits at that stage, or alternatively we recognize that 
there is an error of some kind in the earlier adjudications and 
we remand them as quickly as possible.
    We have a triage system in the staff group in the Office of 
General Counsel that deals with and represents the Secretary 
before the Court of Appeals for Veterans Claims. We will expand 
that effort in order to avoid and triage those cases more 
quickly.
    Senator Burr. I think, clearly, the Office of General 
Counsel understands the problem that is out there and you have 
requested additional staff for that. Let me make an offer to 
you. If at any point you feel that it is beneficial to talk to 
any staff person in a State that represents a United States 
Senator that can give you a view of reality of what they deal 
with in these litigation cases, I will volunteer my staff for 
whatever time you would like to spend with them. I think that 
though you described a very black and white situation, I have 
got individuals who represent the government and represent the 
veterans who are caught in an area that is blurred. And in 
their world black and white rarely happens, primarily because 
there is a disconnect in the interpretation of what the court 
said, how they said it, and I would suggest to you how long it 
took them to say it. So that offer is open to you.
    You have worked in the central office and you have worked 
in the field as an attorney for the VA. I am sure those two 
experiences were very different. As a field attorney, what 
problems do you see with the central office management and 
organization, and do you intend to make changes based upon your 
field experience?
    Mr. Hutter. As a field attorney, Senator, I found that the 
most lacking element from my experience was communication 
between the headquarters and the field. As many of us have 
experienced who have been in field organizations and where 
there is a headquarters, the reliance on the headquarters to be 
the subject matter experts and to provide that guidance and 
help to the field is absolutely instrumental. By the same 
token, the ability of that field to communicate and reach the 
right people in the headquarters who have the breadth and depth 
of experience in a particular legal area to solve their 
problems is also critical.
    Just before I came over here, Senator, I met with a group 
of field attorneys who were here to understand what we do at 
the headquarters. I encouraged them, demanded of them, told 
them I expected of them: if they are not getting the 
communication they need, I need to know. Moreover, I have 
empowered and expect my Assistant General Counsels--senior 
executives--to force feed, to provide the information down to 
the field that is necessary for those attorneys to do their 
jobs.
    Senator Burr. Well, I thank you for that answer and am 
encouraged with that answer. If this Committee can help, I am 
sure you will let us know.
    Earlier this year, the Secretary announced a new policy of 
expediting all claims by veterans of Operation Iraqi Freedom 
and Operation Enduring Freedom. Does the Office of General 
Counsel intend to take any steps to ensure the appeals of these 
veterans are decided expeditiously?
    Mr. Hutter. As you know, Senator, Secretary Nicholson took 
the lead in this area and in expediting the claims of OEF and 
OIF veterans to the top of the heap, both in the regional 
offices and at the Board of Veterans Appeals. The Secretary 
controls those two bodies and, therefore, it is within the 
Secretary's discretion to advance those claims and appeals to 
the head of the line.
    Unfortunately, sir, the Court of Appeals for Veterans 
Claims controls the docket and feeds us the cases that come in; 
and we respond to the court in that regard. What I would 
suggest, sir, is that I will meet with Chief Judge Green of the 
Court of Appeals for Veterans Claims, discuss this with him, 
and see if there is anything we can do to expedite the claims 
of those veterans who are recently returning from Afghanistan 
and Iraq.
    Senator Burr. Clearly, I want to see the Secretary's 
intentions carried out in all aspects. If, in fact, you need 
our help at achieving success for this program, you will let us 
know.
    Mr. Hutter. I will let you know, sir.
    Senator Burr. I thank you, Mr. Chairman.
    Chairman Akaka. Thank you very much, Senator Burr.
    Now, Senator Murray, for your statement and questions.

                STATEMENT OF HON. PATTY MURRAY, 
                  U.S. SENATOR FROM WASHINGTON

    Senator Murray. Thank you very much, Mr. Chairman. I will 
submit my statement for the record; and I apologize for being a 
few minutes late.
    [The prepared statement of Senator Murray follows:]
 Prepared Statement of Hon. Patty Murray, U.S. Senator from Washington
    Mr. Chairman, thank you for holding today's hearing on the 
nomination of Paul Hutter to be the General Counsel of the Department 
of Veterans Affairs.
    I had the pleasure of meeting with Mr. Hutter on Tuesday to discuss 
his nomination, and I appreciate the time he spent talking with me 
about his vision for the office and his passion for helping veterans. 
Mr. Hutter has spent a significant amount of his career working for 
veterans at the VA, including 15 years in the Office of General 
Counsel. During this time he has been involved in some of the biggest 
policy decisions that have taken place in the VA in recent time.
    The position of General Counsel at the VA is an incredibly 
important one. Although the General Counsel does not, as you say in 
your testimony, ``have the privilege of direct interaction with our 
veterans,'' the position does affect nearly everything the VA does. 
From advising the Secretary and other senior leadership at the VA on 
all legal matters, to interpreting laws and regulations on veterans' 
benefits, to drafting legislation, to helping prepare legislative 
testimony, the General Counsel is a key component of the VA 
decisionmaking process.
    Mr. Hutter, you have been nominated to be the General Counsel of 
the VA at a critical time in the VA's history. The agency faces 
challenges caring for our returning servicemembers as they transition 
from the military to the VA. It continues to struggle in establishing a 
joint DOD-VA electronic health record. It faces serious challenges in 
overcoming a growing claims backlog. And, for some unknown reason, it 
faces serious challenges providing accurate and timely information to 
Congress.
    All of these challenges, with the exception of the last, require 
innovative solutions to push the agency forward and will require the 
involvement of your office. As a veteran, a long time VA employee, and 
someone who has two children currently serving in the military, I have 
no doubt of your commitment to veterans.

    Thank you Mr. Chairman.

    Senator Murray. Mr. Hutter, it is good to see you again. I 
appreciated the opportunity to meet with you in my office a few 
days ago and have a conversation, and I appreciate your 
willingness to consider this very important critical job for 
the VA.
    When we talked Tuesday, I told you how frustrated I had 
been with our inability to get accurate and timely information 
from the VA. I think you have heard that several times. But it 
is important, because this Committee really relies on 
information that is provided by the VA, so that we can make 
good decisions about the veterans that we all feel responsible 
for taking care of. If we don't have it, it really impedes our 
ability to do our jobs and to stand up for the veterans that we 
represent.
    But Congress hasn't been alone in being frustrated by the 
secrecy that has clouded the VA. In January of 2006, the 
National Security Archives at George Washington University 
filed a Freedom of Information Act request for documents about 
the number of disability benefits claims filed by veterans from 
the current War in Iraq. The VA responded to that FOIA request 
by denying that the reports even existed, and it was only after 
the Archives appealed the VA's decision and advised the VA that 
it was prepared to file a lawsuit did the agency manage to find 
those records, and it took about 9 months then for the VA to 
respond.
    Can you tell this Committee why it took the threat of a 
lawsuit to release basic information that should have been 
available to the public?
    Mr. Hutter. Senator, I would like to address that question 
by first explaining the process for an FOIA complaint. When an 
FOIA request comes in, it goes to the program office, whatever 
it may be--Veterans Benefits Administration, I would assume in 
this particular case--and the FOIA requires that we provide 
records that are extant, in other words, that are available, 
that are already in place. It does not require that we create 
records.
    That having been said, however, it is up to the program 
office to reach out to the requestor, and make sure that the 
program office understands the request, understands the scope 
of the request, and can appropriately respond in kind with 
extant documents.
    If the appeal is denied--excuse me, if the initial request 
is denied, as in this case you indicated--then it is up to my 
office to adjudicate the appeal of these Freedom of Information 
Act requests, and based upon the information that you have 
provided, it was my office that advised that we needed to grant 
this appeal and we needed to provide the information to the 
requester in this case.
    I am not aware of this particular matter, but I will look 
at it and I will try to find why it took 9 months to respond.
    Senator Murray. Can you assure us that in the future, these 
cases will be expedited, that we can have them sooner--have the 
information sooner?
    Mr. Hutter. Senator, I will work with my colleague, Bob 
Howard, who is the CIO and the Assistant Secretary for 
Information Management, to work with him to ensure that proper 
education and staffing is available to those program offices 
who receive those initial requests so that they understand what 
their role is, how they can communicate with the requester, and 
how they can expedite the process.
    Senator Murray. OK. I think you can hear from the 
questioning, both now and the pre-questioning, that this is a 
critical issue for all of us, so I hope that when you are 
confirmed you will address that for all of us.
    Mr. Hutter. You have my pledge to that, Senator.
    Senator Murray. In your response to the pre-hearing 
questions, you stated that one of the responsibilities of the 
Office of General Counsel is to draft legislative proposals 
from the VA when you submit them to Congress. But, I am told 
that the VA has submitted very few legislative proposals to us. 
Given the extraordinary number of challenges and all the issues 
we are dealing with, I find that very surprising and have a 
hard time understanding why that is the case. You spent 15 
years at the Office. Can you tell me why more legislative 
proposals are not more forthcoming?
    Mr. Hutter. What I would like to do, Senator, is to let you 
know that we are working now with OMB with, I think, 93 
proposals at this point in time on subject matter that range 
across the subject matters that are under the responsibility of 
the Department, and we are working with them in concert with 
the 2009 budget process to winnow that population down to the 
right number and to provide those to you during the budgetary 
process.
    So, 93 is a fairly large number of bills----
    Senator Murray. Have those been in the pipeline for a 
while?
    Mr. Hutter. Some of them have been in the pipeline in 
previous years. Some of them are current. Some of them are 
brand new. Many of them are brand new proposals based upon the 
exigencies of OEF/OIF and the current challenges that we have 
in front of us. I don't have the numbers in front of me, but I 
would be more than willing to share with you what I can of the 
nature, in a general sense, of those bills and where they are.
    Senator Murray. I think this Committee would be interested 
in seeing the general nature of that.
    Mr. Hutter. I will share what I can.
    Senator Murray. OK. I also wanted to ask you about the VA's 
capacity to care for the large influx of men and women 
returning with issues from Iraq and Afghanistan. I am 
particularly interested in mental health care and know that one 
of the biggest problems we are facing that we haven't gotten a 
handle on is the issue of suicide. The Army recently released a 
report that found suicide rates are at the highest they have 
been since 1981 and that there have been several high-profile 
suicides of veterans who have reportedly been denied care by 
the VA. I am sure you are aware of that.
    One of the cases is Lance Corporal Jeffrey Lucy. As you 
know, Corporal Lucy's family has filed a wrongful death suit 
against the VA, alleging that the agency denied him mental 
health care. Now, I know that lawsuit is pending and you can't 
speak on the specifics of that case, but can you tell us what 
the Office of General Counsel is doing to make sure that our 
employees who are out in the field know that they have got to 
provide immediate care for veterans like Corporal Lucy?
    Mr. Hutter. Senator, I know you are aware of our suicide 
prevention hotline that our office helped the program office 
initiate just a few months ago. I am sure you are also aware 
that we have had over 4,500 calls to that hotline, and I 
believe that there have been 145 referrals to our hospitals as 
a result of that hotline. That suicide prevention hotline is a 
major step in that direction and we helped to review the policy 
and make sure that it was proper.
    With respect to the care of individual veterans across our 
country, we have been in partnership with our VHA colleagues 
where sometimes an individual is reluctant to come to our 
medical centers for treatment in the mental health arena for 
various reasons, whether it be a stigma concern or other 
reasons, and we have worked with our colleagues in VHA where 
such an individual has been identified to work with the local 
court systems, to work with the local police departments, to 
encourage--and other support systems in the community--to 
encourage that veteran and that veteran's family to find either 
community processes or, if necessary, in the extreme, legal 
processes at the local-State level to encourage that individual 
to come in for care.
    Senator Murray. That is one side of the issue, the stigma 
issue where people don't seek care, and I realize we have to do 
a lot more to reach out and find these young people and get 
them into whatever place we can to help them. I am asking 
specifically about the number of cases we are hearing where 
someone has come to a VA facility and been told to wait in 
line; there isn't care available, and it ends up in a suicide. 
Are we reaching out to our field employees to make sure they 
understand their responsibility in not turning these people 
away?
    Mr. Hutter. Senator, my folks are reaching out to the 
hospital directors in order for them to understand all of the 
ways that are within the law and within the policy and 
regulation that they can reach out--through the Vets Centers, 
through their CBOCs, through any means that they have to reach 
out to the field to work through this.
    Senator Murray. I understand that aspect. I am asking about 
those veterans who come to a VA facility and are told that they 
can't get in.
    Mr. Hutter. Senator, as I know you know, this is in the VHA 
lane and I will work with Dr. Kussman and his folks to ensure 
that they understand all of the means that they have available 
to them; to admit these veterans and to put them at the head of 
the line, so to speak; to ensure that they have a means to get 
in as quickly as possible. In fact, we are in the process now 
of looking at legislation that will allow VHA to do just that 
for all mental health issues.
    Senator Murray. OK. And Mr. Chairman, if I could ask just 
one more question very quickly. On the delay on benefits that 
we have heard so much about--in fact, Secretary Nicholson said 
that reducing it from 177 days to about 150 days is all he can 
see happening, which is still way, way too long--I notice that 
Professor Bilmes of Harvard University--I think that is how you 
say her name--suggested that we change the system to stop 
examining each application and instead automatically accept all 
disability claims and then audit a sample of them, similar to 
what the IRS does. I know the IRS is not similar to health 
care. I understand that. But can you share your thoughts with 
this Committee on a process like that?
    Mr. Hutter. Senator, I have spoken with our veterans 
service organization colleagues about this very issue, as well 
as internal to the VA. Because of the juxtaposition of health 
care and claims and that overlay of determining the health-
related concerns, I think it would be a very challenging 
process to put into place. Notwithstanding that, the 
Secretary--I was present when the Secretary met with, I think 
it is Professor Bilmes----
    Senator Murray. Bilmes, that is right, yes.
    Mr. Hutter [continuing]. From Harvard, and the Secretary as 
well as the entire staff was charged and energized with the 
concept of trying to figure a system, either the system that 
Professor Bilmes proposed or something akin to that, and we are 
working with the Chairman of the Board of Veterans Appeals and 
with elements of VBA to work through a way we might be able to 
do that right now.
    Senator Murray. OK. I appreciate your taking a look at that 
and letting us know whether there is a way to move to that or 
whether it is not going to be feasible. Thank you very much; 
and thank you, Mr. Chairman.
    Chairman Akaka. Thank you very much, Senator Murray.
    Now let me call on Senator Johnny Isakson for your 
statement or questions.

               STATEMENT OF HON. JOHNNY ISAKSON, 
                   U.S. SENATOR FROM GEORGIA

    Senator Isakson. I will be brief. I apologize that I missed 
your testimony, but I was on the floor making a speech, so I 
apologize very much. You obviously are eminently qualified. I 
read your biography.
    I want to follow up on what Senator Murray just said. I 
think we do need to really evaluate our determination basis on 
these veterans. I had dinner last night with a number of people 
from my community. They came up and invited me to go to dinner 
at Old Ebbitt Grill. One of the guys is a retired Marine and so 
he called Walter Reed and invited two wounded warriors. He 
asked the director of the hospital if we could take a couple of 
them to dinner, and a couple of them came. I sat at their 
table. Both of them severely injured--by IEDs in one case; a 
rocket-propelled grenade, in another case--suffered extensive 
injuries. and are on an outpatient basis, still being treated 
at Walter Reed.
    Their comments about health care at DOD were nothing but 
spectacular, which is what I have always heard; but the hand-
off of their colleagues from DOD to VA, problematic at best.
    I think Senator Murray was referring a minute ago to the 
benefits issue. There seems to be a gap between the 
communication of benefits you have while you are on active duty 
and what your benefits are when you go into VA, particularly 
with regard to health-related issues.
    So, that is kind of a statement, not a question, but I 
would assume the General Counsel's Office would have standing 
to look at ways, in the legal interest of the Veterans 
Administration, but equally in the interest of our soldiers, as 
to how we could improve that.
    I have two questions. You will have 402 lawyers under your 
command, according to some of the responses here, 677 FTEs.
    Mr. Hutter. Correct.
    Senator Isakson. What consumes the majority of the time of 
those 402 lawyers? What issue, or what area of issues?
    Mr. Hutter. Sir, it is a collective bag. I must say that 
the largest concentration of lawyers that we have is focused on 
defending the Secretary in front of the Court of Appeals for 
Veterans Claims, and that is about 42 lawyers right now. Their 
caseload is significant and, through your good offices, we have 
an expectation of being able to hire 15 more with the fiscal 
year 2008 budget that we are looking forward to.
    Senator Isakson. Excuse me for interrupting, but these 42 
are representing the Department, as they should, in legal cases 
that have been filed based on claims for disability?
    Mr. Hutter. Yes, sir, any benefit defined broadly that a 
veteran is dissatisfied in what he has received from the 
Department--either at the regional office level or by the Board 
of Veterans Appeals or in some cases by the Veterans Health 
Administration--can be appealed to the court, and the backlog 
at the court or the caseload at the court right now is about 
4,000 cases. And we, with few exceptions, have to represent the 
Department with respect to those cases.
    Senator Isakson. Out of interest and curiosity--the biggest 
things we are dealing with in the Congress with our veterans is 
PTSD and Traumatic Brain Injury, many of which are latent. You 
don't necessarily have a physical injury that is apparent and 
sometimes they are latent before they actually come about. 
Where is the Department in dealing with that determination 
factor, when a veteran comes in after being separated from the 
military for some period of time? What is the line that you 
draw there?
    Mr. Hutter. Senator, as a result of our research--our 
longstanding research in this area, more recently with TBI--
every veteran who comes to a Veterans Medical Center or a CBOC 
now gets evaluated for TBI, whenever they come in. And that is 
also true for PTSD.
    Now, I am stepping a little out of my lane and into Dr. 
Kussman's lane, but I wanted you to know that that is the 
state-of-the-art, and there is an extensive checklist that 
every specialist at the medical center goes through with each 
veteran to ensure that the diagnosis, if possible, is made at 
the time that that veteran comes to us.
    Senator Isakson. I want to just make you aware of 
something. I held a hearing, Mr. Chairman, at the Augusta VA 
during the August break and, quite frankly, the Augusta VA and 
Eisenhower Medical Center is the one example in the country, 
and General Schoomaker did this, where you have a seamless 
transfer. In fact, VA is actually doing physical rehabilitation 
for active duty soldiers. They seamlessly go back and forth 
based on the needs and the specialties.
    But on this TBI issue, I was touring the hospital and I ran 
into a young lady, a sergeant who was in fatigues and in 
uniform. I was introduced to her and the VA doctor said, you 
need to know something about this lady. He said, she was hit 
and her convoy was hit with an IED the second day she was in 
Iraq and she suffered a Traumatic Brain Injury and she was 
separated from the military because they couldn't, after 
treating it, cure it. She went into the VA. The VA corrected 
the TBI. She reenlisted and went back in the military and was 
on her way back to Iraq.
    The point I make there is this: the better job we can do in 
this transfer to VA and DOD, a lot of these people who--I hate 
to use this term--may be falling through the cracks will not 
fall through the cracks and might, in fact, be rehabilitated on 
a much faster basis than they would otherwise.
    So I would encourage, from a legal side, anything you can 
do to help on that transfer from DOD to VA care and the rights 
of those soldiers and the attention to them, I think, would do 
a great service to our country and to our soldiers.
    I am sorry I took so much time, Mr. Chairman.
    Chairman Akaka. Thank you very much, Senator Isakson.
    I would like to ask Senator Burr whether you have any 
further questions.
    Senator Burr. No.
    Chairman Akaka. I don't have any further questions.
    Senator Isakson?
    Senator Isakson. No, sir.
    Chairman Akaka. Well, in closing, I again want to say 
mahalo nui loa and thank you, Mr. Hutter, and mahalo to your 
family, as well, for your presence here today.
    As you know, every organization needs an unquestioned 
leader. It is not optimal for the Office of General Counsel to 
have an acting leader for an indefinite period of time. With 
this in mind, I say that only to tell you that I will work and 
the Committee will work to move Mr. Hutter's nomination to the 
floor as soon as possible.
    I thank you so much for your responses and the presence of 
your family.
    This hearing is adjourned.
    [Whereupon, at 10:23 a.m., the Committee was adjourned.]


     HEARING ON THE NOMINATION OF MICHAEL W. HAGER TO BE ASSISTANT 
SECRETARY, HUMAN RESOURCES AND MANAGEMENT, U.S. DEPARTMENT OF VETERANS 
                                AFFAIRS

                              ----------                              


                      WEDNESDAY, NOVEMBER 14, 2007

                                       U.S. Senate,
                            Committee on Veterans' Affairs,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 10:11 a.m., in 
room 562, Dirksen Senate Office Building, Hon. Daniel K. Akaka, 
Chairman of the Committee, presiding.
    Present: Senators Akaka and Burr.

     OPENING STATEMENT OF HON. DANIEL K. AKAKA, CHAIRMAN, 
                    U.S. SENATOR FROM HAWAII

    Chairman Akaka. The Committee on Veterans' Affairs will now 
come to order. The Committee is here today to consider the 
nomination of Michael W. Hager to be VA's Assistant Secretary 
for Human Resources and Management. I am pleased to welcome Mr. 
Hager and his family here today and look forward to your 
testimony.
    Mr. Hager, if confirmed, you will be responsible for 
coordinating five major program areas within the Department, 
including diversity management and equal opportunity, human 
resources management, labor-management relations, resolution 
management, and administration. The leadership and program 
direction that your office provides for the Department impacts 
veterans on a daily basis by responding to the needs of a VA 
workforce of over 250,000 permanent and temporary employees who 
are directly or indirectly responsible for delivering health 
care, benefits, and memorial services.
    As Assistant Secretary, you will have the daunting task of 
managing VA's human resources activities during a period when 
VA is confronted with the challenges of a growing retirement-
eligible workforce, health care provider shortages, and delays 
in delivering benefits due to personnel shortages. Included in 
your responsibility for administering VA's labor-management 
relations program is the oversight of negotiations and 
implementation of master agreements with five national labor 
unions.
    The quality of care and the efficient delivery of benefits 
to servicemembers is contingent upon VA's ability to recruit 
and retain a quality workforce. When carrying out this 
responsibility, you will need to appreciate the unique 
relationship that VA employees have with the veterans they 
serve. This relationship goes beyond the bottom line and is 
based upon maintaining a workforce, many of whom are veterans 
themselves, that has a sense of service and dedication. As you 
so aptly quoted Omar Bradley in your response to pre-hearing 
questions, and I am quoting, ``We are dealing with veterans, 
not procedures, with their problems, and not ours.''
    Mr. Hager, your 35 years of experience in human resources 
coupled with your general management experience suggests that 
you have the qualifications for taking on the challenges of 
this office. Assuming you are confirmed, I urge you to work 
closely with the three VA administrations and key staff offices 
to develop workable and viable succession plans while improving 
hiring practices so that the delivery of care and benefits to 
veterans is not disrupted by a change in workforce.
    In closing, I note that the nominee has completed the 
Committee questionnaire for Presidential nominees and responded 
to my pre-hearing questions, all of which will appear in the 
hearing record.
    Chairman Akaka. Also included will be a letter from the 
Office of Government Ethics acknowledging that Mr. Hager is in 
compliance with laws and regulations governing conflicts of 
interest.
    Chairman Akaka. I welcome you here. Senator Burr?

        STATEMENT OF HON. RICHARD BURR, RANKING MEMBER, 
                U.S. SENATOR FROM NORTH CAROLINA

    Senator Burr. Mr. Chairman, thank you. Let me again thank 
you for taking up the key issues before this Committee today. 
We just completed one important responsibility by reporting a 
number of bills that I think will improve the lives and the 
health care provided to our Nation's veterans. Now we turn to 
another important responsibility of this panel and the Senate 
and that is the timely consideration of the President's 
nominees to important positions within government.
    Mr. Hager, I want to welcome you and your family, and I 
think maybe a grandson--I hear the cries from over there. It is 
a delightful sound to know that there is another generation 
that will soon be in the system.
    Mr. Chairman, clearly, all of the senior positions at the 
Department of Veterans Affairs carry responsibilities that are 
essential to the everyday operations of that very important 
agency. But, perhaps there are few positions that are as vital 
as the one that Mr. Hager would fill, if he is confirmed, and I 
have every reason to believe that he will be.
    VA employees are the backbone of the health care and 
benefits system. It is essential that the VA have in place a 
plan and a vision for recruiting and retaining tomorrow's 
dedicated VA professionals. Mr. Hager has an incredible amount 
of experience in overseeing the human resource programs at a 
number of large American companies, and I think you highlighted 
those. Those qualifications speak for themselves and have 
prepared him well to lead the Office of Human Resources at the 
Department of Veterans Affairs.
    Mr. Chairman, I had an opportunity to sit down with our 
nominee to personally talk to him--not just to ask him 
questions about his background, but to ask him questions about 
why he is doing what he is doing. Clearly, this is an 
undertaking that not everybody would want. In the meeting, I 
found him to be a serious and dedicated professional; a person 
with a desire to serve veterans. But, more importantly, I found 
him to be a person that truly did understand that sometimes we 
are asked to serve our country and this is one of those times. 
There is no doubt in my mind that his commitment to his family 
and his country are the two most important things to him. Based 
on these factors, I intend to support his nomination.
    It is my hope, Mr. Chairman, that we can expedite this 
nomination, we can get him confirmed, and the Committee can 
focus on the confirmation process of General Peake. Hopefully, 
before we complete this calendar year we would have a full 
complement at the VA, so that we can move forward with the 
debate on legislation that we have talked about this morning, 
and also two recent commission reports on veterans' benefits 
and where we go from the standpoint of this Committee.
    I know one thing, it is impossible for us to move forward 
with substantive changes unless we have a full complement of 
people in place at the VA. This is one vitally important piece 
that I think we can take care of in a very quick manner and, 
hopefully, move on to the nomination for Secretary.
    Mr. Chairman, I want to thank you for having this hearing. 
I also want to apologize to you and to Mr. Hager because I am 
being called right now down to a markup on the fourth floor 
that I can't miss because it is my bill. That means that I may 
not be here for the testimony or for the questions. But let me 
assure the Chair that I have asked Mr. Hager every question 
that I could possibly pose to him and he answered them better 
than I ever dreamed he could. I thank the Chair.
    Chairman Akaka. Thank you very much, Senator Burr.
    Before I swear you in and ask for your opening statement, 
Mr. Hager, in the room I hear what I consider beautiful sounds 
this morning, and I note that you are accompanied by your 
family. Before I swear you in, may I ask you to please 
introduce your family to us.
    Mr. Hager. Sir, with pleasure, and thank you very much. I 
have my wife of 40 years (almost 40 years), my daughter (really 
my daughter-in-law), and grandson, Christopher, who just 
stepped out of the room. [Laughter].
    I have a son, Mitch, on the Gulf Coast working to help 
rebuild the Gulf Coast, and I have a son, Christopher, Senior, 
who is a physician in Lancaster, Pennsylvania, trying to serve 
his patients--who, by the way, received part of his medical 
training with the VA. So, sorry he couldn't be here today. But 
that is my family, the love of my life, and I thank you for 
asking.
    Chairman Akaka. Well, thank you very much. I want to 
welcome your family to this hearing and wish you well in your 
efforts here.
    Will you please stand and I will administer the oath. Will 
you please raise your right hand.
    Do you solemnly swear that the testimony you are about to 
give this Committee on Veterans' Affairs is the truth, the 
whole truth, and nothing but the truth, so help you, God?
    Mr. Hager. Yes, sir.
    Chairman Akaka. Thank you very much. Let the record note 
that the witness responded in the affirmative.
    Mr. Hager, will you please begin with your testimony.

    STATEMENT OF MICHAEL W. HAGER, NOMINEE TO BE ASSISTANT 
 SECRETARY, HUMAN RESOURCES AND MANAGEMENT, U.S. DEPARTMENT OF 
                        VETERANS AFFAIRS

    Mr. Hager. Mr. Chairman and Members of the Committee that 
were here a short time ago, I do thank you for the privilege of 
being here today. I am indeed honored and humbled to be 
nominated by President Bush to serve as Assistant Secretary for 
Human Resources and Administration for Veterans Affairs. I am 
also honored by Acting Secretary Gordon Mansfield and former 
Secretary Jim Nicholson for their support of my nomination.
    The Department of Veterans Affairs is the second largest, 
and one of the most diverse of all cabinet departments in the 
U.S. Government. It touches the lives of millions of veterans, 
their families, and their dependents every year.
    The Chief Human Resources Officer for the Department must 
provide the leadership, oversight and management of all human 
capital programs and provide high-quality administrative 
services to the Office of the Secretary and VA's central office 
community. To be effective, the leader of H.R. must be an 
active advisor to the Secretary and leadership team, on all 
Human Capital asset programs.
    As you have indicated, I began my preparation for this 
assignment some 35 years ago, working for a defense and 
aerospace contractor, Rockwell International. I have been 
fortunate to have been assigned to increasingly responsible 
managerial assignments in challenging and complex environments. 
These experiences included being the head of Human Resources 
for 15 years for Banc One Corporation, where our employment 
grew from some 7,000 to about 60,000 employees.
    The position I now seek, Assistant Secretary for Human 
Resources and Administration for the Department of Veterans 
Affairs, would be considered the pinnacle of a long career. My 
inspiration to step out of a successful career path in private 
for an opportunity to serve the government came from heroes 
such as Corporal Pat Tillman.
    My opportunity came 27 months ago when I was named 
Associate Administrator for Capital Access for the SBA, Small 
Business Administration. As head of Capital Access, I manage an 
investment loan portfolio of about $80 billion. I also chair 
the implementation of the new program, a loan management and 
accounting system that will replace the legacy system at the 
SBA.
    My views for the leadership role for which I am being 
considered are straightforward and built on a foundation of 
clear communication, transparency, full disclosure, play-by-
the-rules policy, proper controls, fairness, ethics, 
performance culture, human capital business integration, trust, 
and respect.
    Human Resources must ensure a line of sight between its 
mission/strategies of Veterans Affairs and the mission/
strategies of the Veterans Affairs and the needs of American 
veterans and their families. The Department must focus energies 
on VA mission strategies, create leadership accountability, 
honor commitments, build individual capabilities, recognize 
contributions, and address performance issues.
    If confirmed, I commit to a close working relationship, as 
you indicated in your opening comments, with the Secretary, the 
Deputy Secretary, and the entire team of the Department. I am 
mindful the time available for my tenure is very limited, and 
therefore will place emphasis on the value of each day, every 
day. Listening and learning will be a critical part of my 
success.
    I close by stating the core of my passion to fulfill the 
expectations as the VA's Chief Human Resource Officer is fueled 
by the promise of President Lincoln, ``. . . to care for him 
who shall have borne the battle and for his widow and his 
orphan . . .'' If confirmed, I will strive to serve and honor 
the men and women who are America's veterans.
    Thank you, Mr. Chairman, and I would be delighted to 
respond to any questions.
    [The prepared statement of Mr. Hager follows:]
     Prepared Statement of Michael W. Hager, Nominee for Assistant 
   Secretary, Human Resources and Management, Department of Veterans 
                                Affairs
    Mr. Chairman, Senator Burr, and Members of the Committee, I want to 
thank you for the privilege of being here today.
    I am, indeed, honored and humbled to be nominated by President Bush 
to serve as Assistant Secretary for Human Resources and Administration 
for Veterans Affairs.
    I am also honored by Acting Secretary Gordon Mansfield and former 
Secretary Jim Nicholson for their support of my nomination. The 
Department of Veterans Affairs is the second largest and one of the 
most diverse of all Cabinet departments in the U.S. Government and 
touches the lives of millions of veterans, their families, and their 
dependents each year.
    The Chief Human Capital Officer for the Department must provide the 
leadership, oversight and management of all human capital programs and 
provide high quality administrative services to the Office of the 
Secretary and VA's Central Office community. To be effective, the 
leader of Human Resources must be an active advisor to the Secretary 
and leadership team on all human capital asset management programs.
    I began my preparation for this assignment some 35 years ago 
working for a Defense and Aerospace Contractor, Rockwell International. 
I have been fortunate to have been assigned to increasingly responsible 
managerial assignments in challenging and complex environments. These 
experiences included being the head of Human Resources for fifteen 
years at Banc One Corporation where employment grew from 7,000 
employees to about 60,000.
    The position I now seek, Assistant Secretary for Human Resources 
and Administration for the Department of Veterans Affairs, would be 
considered the pinnacle of my long career. My inspiration to step out 
of a successful career path in the private sector for the opportunity 
to serve our government came from heroes such as Pat Tillman. My 
opportunity came twenty-seven months ago when I was named Associate 
Administrator for Capital Access for the Small Business Administration. 
As head of Capital Access I manage an investment and loan portfolio of 
approximately $80 billion. I also Chair the implementation of a new 
Loan Management Accounting System.
    My views for the leadership role for which I am being considered 
are straightforward and built on a foundation of: clear communication; 
transparency; full disclosure; ``play by the rules'' policy; proper 
controls; fairness; ethics; a performance culture; human capital/
business integration; trust; and respect.
    Human Resources must ensure line of sight between its Mission/
Strategies and the Mission/Strategies of Veterans Affairs and the needs 
of American veterans and their families. The Department must focus 
energies on VA Mission/Strategies, create leadership accountability, 
honor commitments, build individual capabilities, recognize 
contributions, and address performance issues.
    If confirmed, I commit to a close working relationship with the 
Secretary, the Deputy Secretary and the entire leadership of the 
Department. I am mindful that the time available for my tenure is 
limited and therefore will place emphasis on the value of each day . . 
. every day. Listening and learning skills will be critical to my 
success.
    I am privileged to introduce my wife, Donna.
    I close by stating the core of my passion to fulfill the 
expectations as the VA's Chief Human Capital Officer is fueled by the 
promise of President Lincoln ``. . . to care for him who shall have 
borne the battle and for his widow and his orphan . . .'' I will strive 
to serve and honor the men and women who are America's veterans.
    Thank you Mr. Chairman and the Committee for your time today in 
your consideration of my nomination.

    I would be pleased to respond to any questions.

    [The Committee questionnaire for Presidential nominees from 
Mr. Hager follows:]



    [A letter from the Office of Government Ethics follows:]

    
    
                                 ______
                                 
                    Department of Veterans Affairs,
                             Office of the General Counsel,
                                Washington, DC, September 26, 2007.
Mr. Robert I. Cusick,
Director, Office of Government Ethics
Washington, DC.
    Dear Mr. Cusick: In accordance with section 2634.605(c) of title 5, 
Code of Federal Regulations, I am forwarding the enclosed Public 
Financial Disclosure Report (SF-278) of Mr. Michael W. Hager. President 
Bush has nominated Mr. Hager to serve in the position of Assistant 
Secretary for Human Resources and Administration of the Department of 
Veterans Affairs (VA). It is my opinion that Mr. Hager's report is 
complete and discloses no unresolved conflicts of interest under 
applicable law or regulation.
    Mr. Hager has agreed pursuant to 18 U.S.C. Sec. 208(a) that he will 
not participate personally and substantially in any particular matter 
that has a direct and predictable effect on his financial interests or 
those of any other person whose interests are imputed to him, unless he 
first obtains a written waiver under section 208(b)(1), or qualifies 
for a regulatory exemption under section 208(b)(2). Mr. Hager 
understands that the interests of the following persons and entities 
are imputed to him: his wife; minor children; general partner; any 
organization in which he serves as an officer, director, trustee, 
general partner or employee; and any person or organization with which 
he is negotiating, or has an arrangement concerning, prospective 
employment.
    Mr. Hager will continue to receive pension payments from his former 
employers, JP Morgan Chase, Boeing North America and Federal Home Loan 
Mortgage. In addition he retains an interest in a split-dollar life 
insurance policy with Northwestern Mutual. Pursuant to 18 U.S.C. 
Sec. 208, Mr. Hager has agreed not to participate personally and 
substantially in any particular matter that will have a direct and 
predictable effect on the ability or willingness of any of these 
entities to honor its obligation to pay his pension or life insurance 
benefits, unless he receives a written waiver, pursuant to 18 U.S.C. 
Sec. 208(b)(1), or qualifies for a regulatory exemption, pursuant to 18 
U.S.C. Sec. 208(b)(2).
    These assurances resolve any concern about real or apparent 
conflicts of interest that may arise from Mr. Hager's report. 
Therefore, I have certified and dated the report.
            Sincerely yours,
                                            Walter A. Hall,
                                      Assistant General Counsel and
                                 Designated Agency Ethics Official.
                                 ______
                                 
  Response to Written Questions Submitted by Hon. Daniel K. Akaka to 
 Michael W. Hager, Nominee to be Assistant Secretary, Human Resources 
             and Management, Department of Veterans Affairs
    Question 1. How do you believe your background has prepared you for 
this job?
    Response. My background of over 35 years of ever increasing 
leadership responsibility in human resources (HR), coupled with overall 
general management experiences, have well prepared me to meet the 
critical needs of the Assistant Secretary of Human Resources and 
Administration (AS/HR&A) for the Department of Veterans Affairs (VA). 
My career in H.R. began in the Defense and Aerospace Industry with 
Rockwell International. From the initial responsibilities of managing a 
compensation plan for one of Rockwell International's manufacturing 
plants to managing an $80 billion loan and investment portfolio for the 
Federal Government's Small Business Administration, I feel well 
equipped to manage the VA's human resources function.
    In recent years, I was part of a team that created a single 
``corporate culture'' from an aggressive acquisition strategy that 
increased its human resources base from 7,000 to about 60,000 
employees. I facilitated the complete replacement of a leadership team 
for one of the Nation's largest government-sponsored enterprises. My 
hands-on experience range from ``Best of Class'' succession planning, 
national recruiting strategies, operations consolidation, national 
benefits design and implementation, to national executive and non-
executive compensation strategies. I have a strong background and 
personal interest in developing and implementing H.R. metrics, and of 
using metrics to foster a strong culture of performance and 
accountability. Bank One was recognized by one of the national leading 
authorities of H.R. strategy for creating an effective leading edge 
H.R. organization strategy.
    In summary, I have been extremely fortunate to have assembled a 
long career of hands-on experiences that have equipped me to face 
immediate and strategic challenges managing human resources. I believe 
these experiences will enable me to meet and exceed the expectations 
expressed for the Assistant Secretary of Human Resources position at 
VA. If confirmed, I will immediately join the collective leadership of 
VA to serve America's veterans and their families.

    Question 2. How would you define your job as Assistant Secretary 
for Human Resources and Administration?
    Response. The AS/HR&A provides leadership and direction for the 
Office of Human Resources and Administration (HR&A), a major staff 
office of the Department of Veterans Affairs. The AS/HR&A reports 
directly to the Secretary of Veterans Affairs and serves as the 
principal advisor to the Secretary on human resources, occupational 
safety and health, workforce diversity, equal employment opportunity, 
discrimination complaint processing (resolution management), labor-
management relations, and administration matters.
    The AS/HR&A heads a major organizational staff component in the 
Department of Veterans Affairs, and serves as advisor to top management 
officials of the Department in those areas under the jurisdiction of 
HR&A.
    The AS/HR&A is responsible for the development and administration 
of an $94 million annual budget, providing leadership and program 
direction to approximately 527 employees nationwide, and advisory 
services to autonomous human resources management officers, Equal 
Employment Opportunity (EEO) officers, and others administering field 
programs under the HR&A's jurisdiction.
    Through the development and implementation of policies and programs 
designed to enhance the Department's effectiveness and efficiency in 
managing its workforce, the AS/HR&A responds to the needs of a diverse 
workforce of approximately 254,000 employees directly or indirectly 
responsible for delivering health care, benefits and memorial services 
to veterans. The AS/HR&A also provides technical oversight for the 
agency's human relations offices and professional workforce, providing 
policy guidance and support through site visits and educational 
meetings.
    Pursuant to the Homeland Security Act of 2002, the Assistant 
Secretary of Human Resources and Administration is the designated VA 
Chief Human Capital Officer (CHCO). The authorities and functions of 
the CHCO include:

     Setting VA's workforce development strategy
     Assessing future workforce needs
     Aligning HR's policies and programs with VA's mission
     Advocating a culture of continuous learning
     Benchmarking best H.R. practices
     Measuring intellectual capital links with organizational 
performance and growth.

    Question 3. What has Acting Secretary Mansfield told you to expect 
from your new position?
    Response. Acting Secretary Mansfield personally conveyed several 
issues for me to address if confirmed as the Assistant Secretary for 
Human Resources and Administration (AS/HR&A).
    Today the H.R. organization is dispersed within the elements of VA: 
the Headquarters, Veterans Health Administration, Veterans Benefits 
Administration, and National Cemetery Administration. There is an 
opportunity to expand the agency's human resources capacity by more 
effectively leveraging the four units to positively affect policy 
application and add enhanced service delivery to the end user of H.R. 
services.
    Like many other departments and agencies, VA's hiring process can 
be untimely and result in the end users of human capital having their 
needs constrained as they deliver services to veterans and their 
families. H.R. will work to reduce the hiring process cycle and 
accelerate the on-boarding of new employees. The AS/HR&A will review 
rapid-hire procedures with OPM to create an optimal process. The AS 
will be expected to present an action plan for streamlining to VA's 
executive leadership group within the next 4 months.
    H.R. is the ``go to resource of information'' for numerous niche 
talent pipelines such as the intern program, distinguished hire 
program, and the physician/nursing program. Today, such programs are 
underutilized due to lack of communication or promotion. H.R. will 
conduct an inventory of all pipeline programs and work with the three 
business lines to communicate availability and promote participation in 
these programs.
    Over the next 4 months, the AS/HR&A will be expected to complete an 
assessment, and reengineering of the headquarters (HQ) and line of 
business training programs to achieve optimum advantage throughout VA 
from existing programs and offer career path development to maximize 
human capital intellectual potential. ``Best of Class'' benchmarking 
within the Federal Government and private industry will be assessed for 
potential duplication.
    Having entered the retirement age of baby boomers, it is essential 
that VA aggressively implement its succession plan. The potential drain 
on our human capital may be significant and the maintenance of 
available human capital talent will be critical. When loss of talent 
occurs, plans must be relied upon to quickly fill critical vacancies.
    In support of succession planning and routine staffing 
requirements, an inventory of hiring inducements must be effectively 
conducted and communicated within VA. We must leverage program 
enhancements and ensure consistent application of them throughout VA. 
We will create programs that offer individual incentives to move from 
low-cost to high-cost areas of the country. Specific programs are 
critical to ensure physicians and nurses are available across the 
country.
    The Nursing Academy must be assessed for potential expansion into 
other areas of health care. These areas will include mental health 
professionals, rehabilitation specialists, social workers, and other 
psychological and psychiatric experts.

    Question 4. What do you believe are the most pressing challenges 
confronting the Office of the AS/HR&A?
    Response. VA faces significant challenges in ensuring it has the 
appropriate workforce to meet current and future needs. Workforce and 
succession planning represent both significant challenges and 
opportunities as VA prepares to lose many of its knowledge workers to 
retirement. As of September 2007, with a total population of 254,578 
employees, 47,631 were eligible to retire. The challenge for the Office 
of the AS/HR&A is ensuring the Administrations integrate their 
workforce and succession planning targets and goals into VA's strategic 
planning process and embrace automating transactional H.R. processes. 
VA must also place a strong emphasis on recruitment, retention and 
development of minorities, women, and people with disabilities for 
leadership positions to ensure service to all veterans is fair and 
sound.
    The Office of the AS/HR&A faces a continuing challenge as it seeks 
to ensure that the Department can effectively manage its workforce 
while also meeting its labor relations obligations. VA has the second 
largest workforce in the Federal Government, and the majority of its 
employees are represented by Department's five national unions. The 
challenge for the Office of the AS/HR&A is to ensure that the 
Department works well with the unions, and the unions work well with 
VA, such that critical management initiatives can be implemented 
quickly to meet the needs of veterans and their families.
    With respect to discrimination complaint processing, one of the 
Office of the AS/HR&A most pressing challenges is ensuring compliance 
with the Equal Employment Opportunity Commission's (EEOC) statutory 
timeframes while maintaining quality. During fiscal year (FY) 2007, 
like many Federal agencies, we experienced a challenge in meeting the 
180-day timeframe for completing investigations. After implementing an 
aggressive plan of action in December 2006 to address this issue, the 
Office of Resolution Management (ORM) improved its cumulative average 
processing time for investigations by 15 percent. Beginning in fiscal 
year 2008, we will process all our investigations within the EEOC's 
timeframes, making VA one of the best performing government agencies in 
terms of complaint processing.
    Other challenges include providing the leadership and oversight to 
obtain commitment at all levels to achieving the President's Safety, 
Health, and Return-to-Employment goals and meeting the Department's 
socio-economic goals. The Office of Administration serves as VACO's 
Simplified Acquisition Office and provides procurement operations for 
VA Central Office. Finding qualified small disadvantaged businesses to 
meet the needs of the Department is difficult but not impossible. For 
the past 3 years, VA Central Office has met or exceeded these socio-
economic goals in support of minority, women, or veteran-owned small 
businesses.

    Question 5. What are your immediate and long-term priorities for 
the office?
    Response. As stated, VA has entered a critical, new era with its 
workforce. Today's leadership will be long remembered for its success 
or failure in dealing with human capital issues.
    For the near term, the Department must create infrastructures that 
enable VA's leadership to effectively manage the Federal Government's 
second largest employee body of approximately 254,000 employees. The 
Department must move from a paper processing operation to an electronic 
infrastructure. The Department must create an ability to incorporate 
flexibility, speed, and automation that will in turn enable VA to more 
effectively deal with veterans and their families' needs. The words of 
Omar Bradley ring as true today as they did in 1947, ``We are dealing 
with veterans, not procedures; with their problems, not ours.''
    This electronic transformation is well underway in several areas of 
H.R., including the conversion of employee files from paper to an 
electronic format.
    Longer term, the Department is challenged with a ``War for Talent'' 
coupled with its ever aging workforce. The Department must create new 
venues to attract a robust pipeline of talent that will serve the 
critical needs of all three of its business centers. Programs ranging 
from leadership development to on-the-job training for entry level 
employees must become a reality. The use of veterans' pools must play a 
critical strategic role in meeting the needs of VA service providers.
    As AS/HR&A I will be challenged to create the formal and informal 
links with VA's organizations needed to foster an environment of 
intellectual growth and vigor and the day-to-day practicality to 
sustain results, accomplishment, and accountability. During my tenure 
as AS/HR&A the CHCO position will move to a performance-based culture 
that will sow the seeds of short-term and long-term success.

    Question 6. What are your views on training AS/HR&A's employees 
nationwide?
    Response. HR&A faces an ever increasing demand for its services 
delivery to the three main veterans' providers, Veterans Health 
Administration (VHA); Veterans Benefits Administration (VBA); and 
National Cemetery Administration (NCA). As the service delivery to 
veterans and families continues its record-breaking pace, the demand 
for quality services to providers becomes critical. Tactical and 
strategic training and development programs are essential.
    In fiscal year 2006, H.R. conducted a thorough competency 
assessment and subsequent gap analysis for its field staff for 22 
identified competencies. The program was designed to provide the basis 
of a training and development foundation. This foundation will enable 
H.R. to pinpoint training needs/programs in contrast to traditional 
programs designed for ``one program fits all.'' HR&A is currently in 
the process of developing resources to address the largest competency 
gaps identified during its diagnostic process.
    HR&A has partnered with the three Administrations and the Office of 
Information and Technology to develop a virtual H.R. Academy. This H.R. 
Academy, currently in the developmental stage, will provide coursework 
to address 22 competencies identified as necessary. The first step will 
be to provide all VA H.R. professionals the opportunity to participate 
in one of three pilot H.R. certification programs through a partnership 
with the USDA Graduate School. At the completion of the program, 
professionals will have the conceptual, technical and procedural 
knowledge and skills necessary for an H.R. practitioner. VA-specific 
coursework will be developed for mid-level and senior-level H.R. 
professionals. This coursework will expand the participants' 
competencies and build on the technical knowledge and concepts 
previously obtained through classroom, online, university, or on-the-
job training.
    In summary, training H.R. employees nationwide is critical to 
accomplish short-term and long-term performance and service delivery 
objectives. Training at all levels of the organization is essential. 
Finally, as authorized in the Homeland Security Act of 2002, HR&A must 
also apply methods for measuring intellectual capital and identifying 
links of that capital to organizational performance and growth. HR&A 
must be accountable and measure that effectiveness of its training 
initiatives.

    Question 7. Given the aging Federal workforce, how will you address 
the need for succession planning for VA's workforce?
    Response. VA's workforce succession planning is considered a ``best 
practice'' within the Federal Government. In 2003, the American 
Hospital Association predicted rapid growth in eleven selected health 
care occupations. Eight of the eleven occupations are identified as 
``mission critical'' in VA. The H.R. function will focus on health care 
delivery positions inasmuch as the vast majority of our approximately 
254,000 positions work for the VHA and represent the biggest challenge 
for our recruitment staff.
    VA has achieved an outstanding record in health care turnover. By 
conducting an in-depth analysis of the workforce, coupled with the 
implementation of several succession initiatives, major advances have 
been achieved. The turnover rate in 2006 for VA health care workers was 
9.9 percent, compared to the overall health care industry's turnover 
rate of 20.3 percent.
    In addition to specific succession planning initiatives there are 
several other programs designed to protect the VA's human capital. 
These programs include:

    1) Programs to hire veterans (current workforce population--31 
percent);
    2) Hiring annuitants;
    3) EEO Federal Career Intern Program;
    4) Student Temporary Employment Program (STEP) and the Student 
Career Experience Program (SCEP)--both available to all levels of 
degree-seeking students;
    5) Noncompetitive hiring authorities for the employment of 
qualified persons with disabilities;
    6) The use of retention bonuses and other incentives to attract 
high-quality candidates (forgiveness of student loans).

    Although VA's total veterans' workforce population is the largest 
in the Federal Government, I am personally committed to maximize the 
hiring of veterans and disabled veterans. I am committed to those 
veterans who face the most challenging task for career opportunities; 
those who have experienced a loss of limb/limbs; those who have 
suffered spinal cord injuries; and those who have suffered traumatic 
brain or neurological injuries.
    The success of all succession planning initiatives is driven and 
evaluated using performance/outcome matrixes. Targets will be 
established and routinely tracked and reported to VA senior leadership.

    Chairman Akaka. Thank you very much, Mr. Hager, for your 
testimony.
    You alluded to this, but specifically, I wanted to ask you, 
what do you see as VA's principal challenge or principal 
challenges in recruiting, training, and retaining a high-
quality of workforce?
    Mr. Hager. I think, clearly, in your opening comments, you 
have identified those key challenges. It is the talent, it is 
the training of that talent, and it is, I believe, technology 
to drive processes within the VA because of the sheer size of 
it. To drive processes from a paper-intensive bureaucracy that 
takes a long time sometimes to reach conclusion, to a value-
added process of using technology where at all possible.
    I believe that there needs to be a major focus on how we 
can develop a stronger pipeline of talent, and quite frankly, 
how we can increase the veteran population within the VA. I 
think it is a resource of talent, a pipeline of talent that we 
can increase participation. I think in particular because of 
the need, a special interest needs to be placed on those 
veterans with major injuries, loss of limb. We heard today 
about the mental health issues that are being dealt with. But 
those all become issues that I believe need very much to be a 
target of creating pipelines of talent into the VA.
    Chairman Akaka. As you know, Senator Voinovich and I have 
been working diligently and pressing hard on what we call human 
capital issues and this is what we are talking about. It is 
working with people and getting people to be able to do the 
best job they can. It is a huge effort. And for me, I feel it 
important knowledge that people need to know how to serve in 
the position that they have, as they work with people--in this 
case, veterans. I have been appalled at times when I get 
complaints of workers who almost completely reject the 
veterans. I wonder, what are they doing in that job if that is 
true. They need to feel that they are there to help veterans 
with their job and the responsibility they have.
    Mr. Hager, what leadership lessons have you learned from 
your over 35 years of experience in the private sector and your 
2 years of government service will be of most use to you in 
this position. So my question to you is what leadership lessons 
have you learned in those years?
    Mr. Hager. I think the only way to achieve full engagement 
of the employees is through inspired leadership. I think the 
individuals that you mentioned that are not friendly to the 
veteran, I would challenge the leadership of that group to say 
there is something wrong here. The mission is strong for this 
Department. It is the strongest in our government. There can be 
no greater mission, in my opinion, than to serve the veteran.
    I had an interesting experience at a VA hospital yesterday. 
Before I came here, I wanted to go through a process center, 
hospital, meet each of the under secretaries and as much of the 
leadership staff as I could. In walking through a hallway and 
meeting a manager in charge of nursing and hearing about her 
story of creating a volunteer group to go out to Andrews to 
welcome home critically injured troops that hadn't seen their 
families yet--giving up their personal time on the weekend to 
do that, waiting recently on a plane that was supposed to land 
at 3:30 in the afternoon. It was 4 hours late and they were 
told, well, you can go home now. And they said, ``No, we are 
staying. We are here for a purpose.'' She talked about the 
mission. Our mission is so strong and our dedication to reach 
out to these warriors, these troops, is overwhelming. I have 
asked to go out with them, if confirmed, in the near future to 
experience the same thing.
    So, I think the leadership is the difference. You can look 
at whether it be the VA or another department of the government 
or certainly within Congress--accomplishments are, I believe, 
driven almost exclusively by strong leadership. With it, much 
gets done. Without it, it is failure.
    Therefore, as I indicated in my comments, every day is 
important because there are so few days left, and make the most 
out of every day and drive the agenda of strong leadership. We 
don't have to drive the mission, it is there.
    Chairman Akaka. Mr. Hager, in your response to pre-hearing 
questions, you indicated that one of your immediate priorities 
would be moving VA from a paper processing operation to an 
electronic infrastructure. You have also, in your prior 
remarks, mentioned technology here. What processes do you view 
as most in need of going electronic; and second, what ideas do 
you have to make these improvements?
    Mr. Hager. I was hoping you would ask me this question. 
When you walk into the hospital environment--and again, I 
experienced it yesterday--one of the things they are most proud 
of is the electronic case and file that they have in the 
hospital. And what that has done to focus care, what it has 
done for the patient, it is unbelievable. What it has done to 
reduce costs of processing is unbelievable.
    My son, who is now a physician, to this day talks about the 
VA patient technology that was implemented several years ago. I 
believe a similar process can occur with employee files. I 
believe a similar process can occur with a vast amount of 
hiring that takes place, recruiting within the VA, to optimize 
the use of technology.
    Many programs are beyond the discussion stage in the VA, 
and I have been delighted to hear about programs that are 
either on a drawing board or just beyond it. For example, some 
5,000 employee files per week are being converted to an 
electronic paperless process with some of the most stringent 
quality checks that I have ever seen in private. That process 
is well underway and will incorporate an incredible amount of 
facilitation for processing 254,000 employees.
    I see the same thing in the recruiting side, to be able to 
assist leadership/managers in identifying candidates for open 
positions and, hopefully, technology that enables a prospective 
employee to fill out a profile so that we can hone in on those 
skills that we desperately need and complete a screening 
process before we get into a huge paper processing scenario.
    I do believe that we can enhance the quality of service, we 
can enhance the retention of the people we hire, and we can 
achieve something close to what has been done on the patient 
side. So, technology is something that, if confirmed, from day 
one until the day I leave my position I will incorporate with 
intensity.
    Chairman Akaka. Also, in your responses to pre-hearing 
questions, you identified a problem that has plagued VA for 
some time--how to reduce the hiring process cycle and 
accelerate bringing new employees on board. In your experience 
and given the limited time you will have with the Department, 
how can this problem be addressed, especially in view of the 
projected appropriation for 2008 that will allow VBA to 
substantially increase staffing in order to address the current 
claims backlog?
    Mr. Hager. I want to see this process improved, and I have 
had this discussion with the Acting Secretary. I want to see us 
leverage the resources that we have in the VA, to take a look 
at best practice. Who does this better than anyone within the 
VA? There are many operating units in the VA, and it is not 
necessarily a single business unit that perhaps creates best 
practice. Kansas City may have created a process that is far 
better than what we find in New York, for example. Well, let us 
take Kansas City and have that group that created that hiring 
process pitch their best practice to the other business units 
to adopt those practices to streamline the hiring process.
    I think we have to put a team together to take a look at 
VA's best practices: ``in private'' best practice, the use of 
technology, then drive for some project reengineering, drive to 
an absolute minimum the amount of time it takes to create a 
hiring document and give it to HR, to the time it takes for a 
person to begin work. It is not just a VA issue within the 
government. I believe it is an issue throughout the government. 
I think it is also an issue that largely exists in private.
    But, I do believe you have some great talent and you have 
proven that talent on the medical side with technology. Many of 
those same skills can be cascaded down to H.R. I intend to have 
this as one of the leading priorities that I will be reporting 
back to the Assistant Secretary, soon to be the Deputy, until 
it is perfected to the extent possible within the time line 
that I have here and create a legacy to be carried on after I 
leave.
    Chairman Akaka. Mr. Hager, of all government agencies, VA 
should be the most conscientious, we believe, in hiring 
veterans, especially disabled veterans. How would you ensure 
that regional hiring authorities accord the best and the 
highest priority to hiring veterans, especially those that are 
disabled?
    Mr. Hager. In my opinion, a disabled veteran that has gone 
through rehab to the extent rehabilitation is possible, and the 
person wants to work, we have an obligation to find a job for 
that person. I think it is like any other critical process. It 
has to be measured. We need to identify how many troops we have 
in that category, particularly the ones that, again, have 
suffered a serious injury. We must identify how many by region 
and target those individuals by identifying critical 
information on where they are, what are their skills, what is 
their capability of working, what are their restrictions, if 
any, and track them until we find a job for them.
    The Acting Secretary announced this week that a targeted 
group of people would spend full time on these kinds of 
initiatives--to try to find jobs for those that have sacrificed 
the most, those that have sustained serious injury, certainly 
those that have lost limb, sight, or suffered some mental 
injury. These veterans have to have a very significant target 
for optimizing VA hires.
    There are only so many priorities one can accomplish within 
a short period of time, but this initiative has to be one of 
the top of my priorities.
    Chairman Akaka. Under the Uniformed Services Employment and 
Reemployment Rights Act, called USERRA, employers, including 
the Federal Government, have certain responsibilities to rehire 
individuals who are seeking to return to their jobs following a 
period of active service. It is particularly troublesome to me 
that an individual who has been sent into battle by the 
government would need to do battle with that same government 
for the right to regain a job and its associated benefits. 
However, that does happen and it happens far too often. Indeed, 
according to the Department of Labor, more than 30 claims of 
violations of USERRA were launched against VA in fiscal year 
2006. This should be embarrassing to the agency and really 
should not be happening. If confirmed, what will you do to make 
sure VA follows the law?
    Mr. Hager. Sir, going back and recapping the foundation 
that I have indicated that I believe the H.R. function needs to 
be built around, clearly--playing by the rules--is foremost and 
there can be no second-guessing of that strategy. I don't have 
information on what you have just cited. I would look forward 
to the opportunity to work with you to come back with an 
answer, why did that happen and what we have done to fix it.
    And also from the private perspective, I would relish the 
opportunity to work with this Committee on how we could create 
better opportunities in private for a returning GI, of ensuring 
that the job they gave up, to the extent possible, is a job 
they will have when they return, and pay while they are gone, 
to the extent possible to make them whole or make their 
families as whole as possible. I would welcome the opportunity 
to work with this Committee to do that.
    Chairman Akaka. Well, I thank you so much for your 
testimony, your responses, as well, and I want to thank you for 
bringing your family here to this hearing today. I am happy to 
have their presence here.
    As you all know, this challenging position requires a 
strong leader to provide direction and cultivate one of VA's 
greatest resources, its quality workforce. With this in mind, I 
will work to move Mr. Hager's nomination to the floor as soon 
as possible.
    With that, this hearing is adjourned.
    Mr. Hager. Thank you very much.
    Chairman Akaka. Thank you.
    [Whereupon, at 10:45 a.m., the Committee was adjourned].


  NOMINATION OF CHRISTINE HILL TO BE ASSISTANT SECRETARY OF VETERANS 
                    AFFAIRS (CONGRESSIONAL AFFAIRS)

                              ----------                              


                        THURSDAY, JUNE 26, 2008

                                       U.S. Senate,
                            Committee on Veterans' Affairs,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 11:02 a.m., in 
room 418, Russell Senate Office Building, Hon. Daniel K. Akaka, 
Chairman of the Committee, presiding.
    Present: Senators Akaka, Burr, and Isakson.

     OPENING STATEMENT OF HON. DANIEL K. AKAKA, CHAIRMAN, 
                    U.S. SENATOR FROM HAWAII

    Chairman Akaka. The hearing will come to order. Good 
morning.
    Senator Dole. Good morning.
    Chairman Akaka. It is great to have Senator Dole with us 
this morning, and before I make my remarks, I would like to 
call on you to make yours.
    Senator Dole. Thank you very much, Mr. Chairman.
    Chairman Akaka. Senator Dole?

  PRESENTATION OF CHRISTINE O. HILL, NOMINEE TO BE ASSISTANT 
    SECRETARY, CONGRESSIONAL AND LEGISLATIVE AFFAIRS, U.S. 
DEPARTMENT OF VETERANS AFFAIRS, BY HON. ELIZABETH DOLE, A U.S. 
            SENATOR FROM THE STATE OF NORTH CAROLINA

    Senator Dole. Mr. Chairman, Ranking Member Burr, I am 
delighted to be with you this morning, and indeed it is a great 
privilege to introduce Ms. Christine Hill, who has been 
nominated by the President to serve as the Assistant Secretary 
for Congressional and Legislative Affairs at the Department of 
Veterans Affairs.
    I am honored to come before this Committee to express my 
strong support for Christine's nomination. I have known her for 
a number of years and I can assure you that she is highly 
qualified. It is a pleasure today to see Christine's husband, 
Greg, who is with us. He is also an Air Force pilot and a 
veteran. Christine and Greg are true partners, and I saw that 
firsthand. I saw their support for each other, for their 
partner's career, when I was privileged to have Christine 
working with me.
    Christine has served as the Acting Secretary for 
Congressional and Legislative Affairs since the beginning of 
this year, and for the two previous years, she served as the 
Deputy Assistant Secretary. Before joining the Department of 
Veterans Affairs, Christine was the Director of Legislative and 
Intergovernmental Affairs for the 2005 Base Closure and 
Realignment Commission. In that capacity, she supervised the 
production of 40 BRAC hearings across the country, arranged 
hundreds of Commission meetings with elected officials, and 
responded to thousands of Congressional inquiries. The 2005 
BRAC was the most responsive and most accessible of the five 
Commissions established to date. Much of the reason for that 
achievement: Christine Hill's leadership and management skills.
    Prior to her work on BRAC, Christine served as my military 
Legislative Assistant for over 2 years, and she did a 
magnificent job advising me on all matters pertaining to 
veterans, our Armed Forces, and foreign affairs generally. She 
is a 1983 graduate of the Air Force Academy and a career Air 
Force officer with an outstanding record of accomplishments. 
She held a number of staff, training, management, and 
leadership positions before retiring as a Lieutenant Colonel. 
She flew the KC-135 Stratotanker. She flew combat support 
missions during the U.S. intervention in Panama and in support 
of Operation Desert Storm. Christine was the first woman 
assigned to fly the B-1 bomber.
    She is a veteran with considerable familiarity and 
knowledge of Capitol Hill. Christine has over 20 years of 
experience in managing diverse programs and working with the 
various branches of government, as well as business and 
community organizations. In short, Mr. Chairman, Mr. Ranking 
Member, Christine Hill is a strong leader. With her vast 
experience and talents, she is the right person to become the 
Assistant Secretary for Congressional and Legislative Affairs 
for the Department. I have complete confidence that she will, 
if confirmed, do an outstanding job, and I wholeheartedly 
endorse her nomination and urge the Committee's unanimous 
support.
    Thank you very much.
    Chairman Akaka. Thank you very much, Senator Dole. We hear 
you, and thank you so much for that introduction of this great 
nominee. Thank you for coming and for being so patient. Thank 
you.
    Ms. Hill, this Committee is here to consider your 
nomination to be Assistant Secretary of Congressional Affairs. 
I am pleased to welcome you and your husband, Greg, here. As we 
say in Hawaii, aloha and welcome to our hearing.
    Ms. Hill, if confirmed, you are the VA's point person for 
all Congressional inquiries, for ensuring that we are kept 
informed about policies, procedures, and actions at the VA. You 
also have the task of ensuring that Congressional inquiries and 
casework are handled swiftly and appropriately.
    I note that the nominee has completed the Committee 
questionnaire for Presidential nominees, which will appear in 
the hearing record. Also included will be a letter from the 
Office of Government Ethics acknowledging that she is in 
compliance with laws and regulations governing conflicts of 
interest. In addition, Ms. Hill's complete statement will be 
printed as part of the record of these proceedings.
    Chairman Akaka. We have heard the introduction from Senator 
Dole and we are glad to have you as a nominee.
    Senator Burr?

        STATEMENT OF HON. RICHARD BURR, RANKING MEMBER, 
                U.S. SENATOR FROM NORTH CAROLINA

    Senator Burr. Mr. Chairman, thank you. I have got one more 
reason to support Colonel Hill today than all the things that I 
have had an opportunity to observe: Her choice of individuals 
to introduce her, my colleague and senior Senator. Mr. 
Chairman, I am not sure if you have been exposed to Senator 
Dole's introductions of nominees, but she is most thorough. She 
picks up on things that date back in history that absolutely 
give us a picture of the person that has been nominated, and 
Senator Dole has done that as it relates to Christine Hill.
    I want to welcome you. I want to thank you, Mr. Chairman, 
for expediting this hearing and it is my hope that we can 
expedite this process and have her in a position that is 
permanent and confirmed by the Congress.
    Clearly, Senator Dole covered all of the experience that 
she has. Last week, I had the pleasure of visiting with Colonel 
Hill. I am confident that her experience as an Air Force 
officer, Capitol Hill staffer, an appointee at the VA, and most 
importantly, Mr. Chairman, as a veteran, will enable her to 
serve as the Department's chief liaison to Congress in an 
incredibly effective way.
    I would like to welcome her husband, Greg. I would like to 
say to Colonel Hill, your nomination is a testament to your 
capabilities and to your qualifications and I will be proud 
when this Committee moves this nomination.
    I thank the Chair.
    Chairman Akaka. Thank you very much, Senator Burr.
    I would tell you, Ms. Hill, that we will give you the oath 
and ask you to please stand and raise your right hand.
    I, Christine Hill----
    Ms. Hill. I, Christine Hill----
    Chairman Akaka [continuing]. Will swear to tell the truth, 
the whole truth, and nothing but the truth, so help me, God.
    Ms. Hill [continuing]. Will swear to tell the whole truth 
and nothing but the truth, so help me, God.
    Chairman Akaka. Thank you. Thank you very much for being 
here, Ms. Hill, and we will ask you now to proceed with your 
testimony.

    STATEMENT OF CHRISTINE O. HILL, NOMINEE TO BE ASSISTANT 
    SECRETARY, CONGRESSIONAL AND LEGISLATIVE AFFAIRS, U.S. 
                 DEPARTMENT OF VETERANS AFFAIRS

    Ms. Hill. Mr. Chairman, Senator Burr, thank you for the 
opportunity to testify today. I am honored and humbled to be 
nominated by President Bush to serve as an Assistant Secretary 
of the Department of Veterans Affairs.
    I also want to thank Senator Dole for taking her time to be 
here today. It is quite a privilege to have someone who I 
consider to be the ultimate role model for any woman nominated 
to serve in the executive branch to speak on my behalf. My time 
on her staff was educational, inspirational, and my first 
opportunity to see just how rewarding it is to work on issues 
that are important to our Nation's veterans.
    I am also most grateful to Secretary Jim Peake and Deputy 
Secretary Gordon Mansfield for their confidence in me. I have 
been given many wonderful opportunities over my career, most of 
which came about because of leaders who saw my potential and 
pushed me to further excellence. Both Secretary Peake and 
Deputy Secretary Mansfield challenge the professionals of the 
Department of Veterans Affairs, daily, toward greater 
excellence, and I am fortunate to have learned from their 
strong guidance.
    With me today is my husband, Greg--a veteran Air Force 
pilot, and my constant loving support for over the past 28 
years.
    When discussing the importance of a veteran's family, I 
know only too well what is asked of a military spouse. We have 
both spent sleepless nights wondering if the other would come 
home safely. We have both missed numerous important milestones 
and holidays. And we have both served as surrogate families 
when fellow airmen needed support or a helping hand. If 
confirmed, I look forward to working with this Committee to 
ensure that veterans and the families of those veterans 
recognize the VA as that helping hand, as well.
    I am proud that I am the daughter and granddaughter of 
veterans. My father was instrumental in sending me on the 
wonderful journey of a military career. My father-in-law was a 
Korean War Air Force veteran. These men served their country 
selflessly with no expectation of anything in return; but I, 
like you, want to make sure the best VA possible is there for 
them when and if needed.
    As a veteran of 20 years of active service in the Air 
Force, I have a deep respect and appreciation for the personnel 
who serve in our Armed Forces. Time and again, I saw in my 
friends and my colleagues the honor, courage, and commitment 
that make our military the greatest in the world. I see that in 
the veterans of the wars before my time, and I see that in our 
newest veterans from today's War on Terror.
    I am inspired by them to help set the footprint that will 
address the challenges in the future: the continuation of world 
class health care; the smoothing of transition from active 
military service to the status of veteran; and the efficient 
delivery of earned and deserved benefits. If confirmed, I look 
forward to continuing my work with the dedicated professionals 
at the Department of Veterans Affairs who clearly appreciate 
their mission and understand the many issues that are of 
concern to our veterans.
    I am committed to clear and open communications with this 
Committee and all Members of Congress and their staffs. The 
work this Committee does is crucial to the success of the VA 
and only with the submission of timely, quality, and accurate 
information can we support you effectively as part of this 
team.
    Thank you again, Mr. Chairman, Senator Burr, for your 
consideration of my nomination. I would be happy to answer any 
questions you have at this time.
    [The prepared statement of Ms. Hill follows:]
    Prepared Statement of Christine O. Hill, Nominee for Assistant 
    Secretary, Congressional and Legislative Affairs, Department of 
                           Veterans' Affairs
    Mr. Chairman, Senator Burr, and Members of the Committee, thank you 
for the opportunity to testify today. I am honored and humbled to be 
nominated by President Bush to serve as an Assistant Secretary at the 
Department of Veterans Affairs. Senator Dole, thank you for taking the 
time to be here today. It is quite a privilege to have someone whom I 
consider the ultimate role model for any woman nominated to serve in 
the Executive branch, speak on my behalf. My time on your staff was 
educational, inspirational, and my first opportunity to see just how 
rewarding it is to work on issues that are important to our Nation's 
veterans.
    I am also most grateful to Secretary Jim Peake and Deputy Secretary 
Gordon Mansfield for their confidence in me. I have been given many 
wonderful opportunities over my career--most of which came about 
because of leaders who saw my potential and pushed me to further 
excellence. Both Secretary Peake and Deputy Secretary Mansfield 
challenge the professionals in the Department of Veterans Affairs, 
daily, toward greater excellence and I am fortunate to have learned 
from their strong guidance.
    With me today is my husband Greg--a veteran, an Air Force Pilot, 
and my constant loving support over the past 28 years. When discussing 
the importance of a veteran's family, I know only too well what is 
asked of a military spouse . . . we have both spent sleepless nights 
wondering if the other would come home safely, we have both missed 
numerous important milestones and holidays, and we have both served as 
surrogate family when a fellow airman needed support or a helping hand. 
If confirmed, I look forward to working with this Committee to ensure 
that veterans, and the families of veterans, recognize the VA as that 
helping hand as well.
    I am proud that I am the daughter and granddaughter of veterans. My 
father was instrumental in sending me on the journey of a military 
career. My father-in-law was a Korean War Air Force veteran. These men 
served their country selflessly, with no expectation of anything in 
return . . . but I, just like you, want to make sure that the best VA 
possible is there for them when needed.
    As a veteran of 20 years of active service in the Air Force, I have 
a deep respect and appreciation for the personnel who serve in our 
Armed Forces. Time and again I saw, in my friends and colleagues, the 
honor, courage and commitment that make our military the greatest in 
the world. I see that in the veterans of wars before my time and I see 
that in our newest veterans from today's War on Terror.
    I am inspired by them to help set the footprint that will address 
the challenges of the future...the continuation of world class health 
care; the smoothing of transition from active military service to the 
status of veteran; and the efficient delivery of earned and deserved 
benefits. If confirmed, I look forward to continuing my work with the 
dedicated professionals at the Department of Veterans Affairs who 
clearly appreciate their mission and understand the many issues that 
are of concern to our veterans. I am committed to clear and open 
communication with this Committee and all Members of Congress and their 
staffs. The work this Committee does is crucial to the success of the 
VA and only with the submission of quality, timely and accurate 
information can we work effectively as a team.

    Thank you again, Mr. Chairman and Members of the Committee, for 
your consideration of my nomination. I would be happy to answer any 
questions you may have.

    [The Committee questionnaire for Presidential nominees from 
Ms. Hill follows:]



    [A letter from the Office of Government Ethics follows:]


    
    

    Chairman Akaka. Thank you very much for your testimony, Ms. 
Hill.
    You have worked for the VA for over 2 years and have done 
the job you are seeking for over 5 months. What do you see as 
the biggest challenge facing VA in the near future, and VA 
Congressional Affairs?
    Ms. Hill. Mr. Chairman, I see the biggest challenge in the 
short-term is to continue our effort to ease the transition 
between DOD and VA, to make it as seamless as possible. 
Currently, there is unprecedented dialog between senior 
leadership and the employees of DOD and VA to try and work 
forward in that effort and I want to make sure that that dialog 
continues. We are making considerable inroads in making that 
transition as seamless as possible in the short-term and for 
the future. We need to continue down that path.
    Also, in the processing of disability claims, that system--
it needs to be improved. As was mentioned earlier, we have 
rooms of paperwork, old-fashioned mailroom-type setups. We need 
to press forward in technological solutions to improve 
timeliness, efficiency, and to just provide the best customer 
support for our veterans as possible.
    As far as Congressional affairs, short-term, not so much a 
challenge as an opportunity. In the short-term, we need to 
continue to educate and advocate and make sure that 
Congressional staffs, Congressional committees, and our 
veterans know what the VA is doing, how we are doing it, and 
how we can continue to improve.
    Chairman Akaka. Ms. Hill, what do you see as your role in 
VA policymaking?
    Ms. Hill. Mr. Chairman, often I consider the Office of 
Congressional Affairs in the example of, we don't make the 
ball, we make the ball bounce. My role is not so much in making 
policy, but certainly in influencing it. By working with this 
Committee, with our other oversight committees, and Members of 
Congress, I have ready access to the trends and the views of 
your constituents, of our veterans, and for me, in a policy 
influencing role. I am in a unique position to help determine 
what direction that policy should proceed based on the inputs 
that you receive from veterans, which is often different from 
the inputs that we receive.
    Chairman Akaka. I trust that you will agree that if 
confirmed, one of your priorities will be ensuring the timely 
receipt of testimony and other deliverables to this Committee. 
As you know, we have had a number of unfortunate incidents with 
late testimony and late deliverables to this Committee this 
Congress. I would like your assurances that you will put timely 
and accurate receipt of information to this Committee at the 
top of your priority list.
    Ms. Hill. Absolutely, sir.
    Chairman Akaka. Thank you so much for that, and with that, 
that is my final question.
    Senator Burr?
    Senator Burr. Mr. Chairman, thank you. I had an opportunity 
to ask her every question the other day that really was 
appropriate for me to ask, but I would like to reinforce a 
couple of points and make one additional one.
    Mr. Chairman, I am convinced that if there is anybody that 
fills this role who can actually influence when testimony comes 
to this Committee, we are looking at her.
    Ms. Hill. That is correct, sir.
    Senator Burr. I have got unbelievable confidence in it, but 
I also understand that our expectations can't shoot higher than 
even what somebody like Colonel Hill can do.
    I think it is also important that we tend to focus on the 
communications to Congress from a standpoint of your role, and 
I want to urge you to communicate back to the VA the true 
understanding you get from this Committee and from its Members 
of the things that we are concerned with. I think we have a 
tendency, as an institution--not as much this Committee but as 
an institution--to be a crisis management tool. I think our 
Founding Fathers envisioned that we would be a visionary 
institution, that we would address problems before they were 
problems. Therefore, veterans never felt it. The American 
people never felt it.
    I think we have failed at that. We don't accomplish that 
just with the communication coming from the executive branch to 
the legislative branch. It has to be a unique understanding by 
the executive branch of what the heartbeat of the Congress is 
at any given point in time, and I hope that that line of 
communication will work both ways from the standpoint of 
yourself.
    Mr. Chairman, I think it is incredibly difficult. Most 
nominees that we have come in have quite a period of time to 
accomplish their own personal goals and, I think, the 
challenges that the job entails. That is not the case for 
Colonel Hill. It is a very short period of time.
    I would encourage you, as you begin to look at your own 
personal goals and how you can make your mark on the role that 
you play, that you really take into account the length of time 
that you've got. It is advantageous to this Committee, its 
Members, to you, and to the VA, but, more importantly, to the 
veterans, that we succeed at whatever levels you shoot for and 
whatever impact you have targeted.
    Again, Mr. Chairman, I thank you for having this hearing. I 
think this is a superb nominee. I would hope that the Committee 
and the Members and the staff would do everything they can to 
expedite this as quickly as we can.
    Chairman Akaka. Thank you very much, Senator Burr. We 
certainly will expedite it.
    Let me ask Senator Isakson for any remarks and questions he 
may have.

               STATEMENT OF HON. JOHHNY ISAKSON, 
                   U.S. SENATOR FROM GEORGIA

    Senator Isakson. Thank you, Mr. Chairman. I came back 
because I was so impressed with Colonel Hill when I met her. 
You know, a lot of times, we have people who are recommended 
for jobs and if you read their resume, you question sometimes 
the match between the life experience and the job ahead. 
Colonel Hill is a decorated veteran, a B-1B pilot, a KC-135 
pilot, who also worked in Elizabeth Dole's office. So she has 
worked both sides of Congressional liaison, from being a 
veteran and being a distinguished officer to actually seeing 
how we work.
    But I did want to make a point with regard to something 
both you and Senator Burr referred to. The VA has reminded me 
the last couple of years of a major league catcher without a 
mitt. I mean, they have gotten fired at, fast balls right and 
left. There are some really great stories coming out of what 
has happened in the last 2 to 3 years in this Congress and what 
the Veterans Administration has done.
    So I hope as a Congressional liaison officer, you will help 
to bring those stories back to Members of Congress. I have 13 
installations in my State, an awful lot of veterans, and I go 
visit them. So, I have seen the Warrior Transition Centers that 
have been brought about and what a difference they are making; 
the seamless transition between DOD health care at Eisenhower 
and Augusta and the Uptown Augusta VA Center; and these are all 
things that weren't happening 4 or 5 years ago and they have 
happened because the VA has taken direction and has taken its 
own initiative, as well.
    So, I just came to commend Colonel Hill and her service to 
the country and her desire to continue to serve, and tell you 
that this is one of those rare situations where we have someone 
who is absolutely, unequivocally qualified to do the job from 
day one, and I hope we will confirm her as quickly as possible.
    Senator Burr. Mr. Chairman?
    Chairman Akaka. Senator Burr?
    Senator Burr. May I, on behalf of Senator Isakson and I--
since I am sure I have been asked and I am sure he has been 
asked, to--make the point that the Augusta VA facility is a 
unique facility; that the folks that work there are very proud 
of and would very much like the Secretary to come down and 
visit. I would be remiss if I didn't, on behalf of both of us, 
say that. As you are going through your confirmation hearing, 
Colonel Hill, please make sure that you pass that on to the 
Secretary, and I think you would find that Senator Isakson and 
I might both visit. We might even get the Chairman to go with 
us if, in fact, the Secretary can accommodate that.
    Ms. Hill. Sir, I will certainly pass that on.
    Senator Isakson. Mr. Chairman?
    Chairman Akaka. Senator Isakson?
    Senator Isakson. Since Senator Burr brought that up, let me 
just tell you a remarkable story. I held a hearing there last 
August on veterans' benefits and seamless transition and 
wounded warrior and PTSD and TBI. After the hearing--of which 
there were 250 attendees and the Washington Post covered the 
hearing themselves--we took a tour of the hospital. And as we 
turned the corner in the VA facility, a sergeant walks by and 
the director of the facility stopped her and said, ``Sergeant 
Harris, would you come over here a minute,'' and introduced 
Sergeant Harris to me.
    Sergeant Harris is a Georgian. She went to Iraq. The second 
day she was in Iraq, her vehicle was hit with an IED. She had a 
Traumatic Brain Injury, came back to the DOD, came back to 
Walter Reed, and was finally severed because they couldn't 
quite get the TBI corrected. She moved back home, and in this 
seamless transition, Eisenhower handed her off, so to speak, 
seamlessly to the doctors at the Uptown VA facility, who 
immediately began treating the TBI. Within 3 months, it had 
been corrected. She reenlisted and went back to Iraq.
    Now, that is one of the more remarkable stories, but it 
shows you how--with the coordinated effort between DOD and 
Veterans Health and the attention that is now being given in 
Veterans Health to TBI and PTSD--that we are making some 
remarkable recoveries; and it is a prime example that the 
Secretary should see as soon as possible. So we would love to 
have you all down any time.
    Ms. Hill. Definitely.
    Chairman Akaka. Well, if there are no further comments, I 
want to thank you so much, Ms. Christine Hill, and your 
husband, Greg, for being here today. It is imperative that this 
position be filled by a dedicated and responsive leader and 
this is what has been mentioned. With this in mind, I will work 
to move Ms. Hill's nomination to the floor as soon as possible 
with their help. We will do that, and I am saying this for our 
staff to also help us do this. We need to get you confirmed.
    So thank you very much for being here. This hearing is 
adjourned.
    Ms. Hill. Thank you.
    [Whereupon, at 11:25 a.m., the Committee was adjourned.]


NOMINATION OF HON. PATRICK W. DUNNE TO BE UNDER SECRETARY FOR BENEFITS 
                 OF THE DEPARTMENT OF VETERANS AFFAIRS

                              ----------                              


                     WEDNESDAY, SEPTEMBER 17, 2008

                                       U.S. Senate,
                            Committee on Veterans' Affairs,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 10:09 a.m., in 
room 418, Russell Senate Office Building, Hon. Daniel K. Akaka, 
Chairman of the Committee, presiding.
    Present: Senators Akaka, Murray, Tester, and Burr.

     OPENING STATEMENT OF HON. DANIEL K. AKAKA, CHAIRMAN, 
                    U.S. SENATOR FROM HAWAII

    Chairman Akaka. Good morning, everyone. This hearing will 
come to order.
    The Committee convenes today to consider the nomination of 
the Honorable Patrick Dunne to be Under Secretary for Benefits. 
I am pleased to welcome Admiral Dunne and his family to today's 
hearing. Admiral Dunne is accompanied by his wife, Diane, his 
daughter, Erin, and his son, Patrick. We are glad to have you 
here, and I welcome each of you.
    The nominee before the Committee today had a long and 
distinguished career in the United States Navy before retiring 
as a Rear Admiral in December 2005. He was nominated to serve 
as VA's Assistant Secretary for Policy and Planning in May 2006 
and this Committee held a hearing and sent his nomination 
forward to the full Senate, which confirmed him on August 3, 
2006. He continues to hold this position while also being 
designated as the Acting Under Secretary for Benefits since 
Admiral Cooper's retirement in April of this year.
    Admiral Dunne, having performed the duties of this office 
for the past 5\1/2\ months, I know you are aware of the many 
challenges that are facing the Veterans Benefits 
Administration. The backlog of disability compensation claims 
remains a major concern, even as VBA continues to explore 
fundamental reforms to the structure of disability compensation 
benefits. Based on your testimony and thoughtful responses to 
questions at this Committee's recent hearing on claims 
processing, I know that you understand the Committee's concern 
that claims be processed as timely and as accurately as 
possible.
    There are also important decisions to be made regarding the 
administration's G.I. Bill for the 21st Century, which was 
recently signed by the President. It is also critically 
important that the Under Secretary for Benefits be personally 
committed to the joint efforts of VA and the Department of 
Defense to meet the needs of servicemembers transitioning from 
active to veterans' status.
    The Committee realizes that there are only a few months 
left in the current administration and it is uncertain how much 
time you will have to tackle these challenges. Typically, this 
late in the second term of an administration, I would really 
not seek to act on a nomination and would leave the acting 
official in place for the duration of the term. However, given 
the nominee before the Committee is the acting official and 
because you have been performing the duties of the office for 
5\1/2\ months--and from where we are, you have been doing a 
good job--I believe it prudent to give you the clear authority 
and responsibility that accompanies Senate confirmation. This 
will enable you to effectively lead the VA to the end of the 
term and ensure a successful transition to the next 
administration.
    I note that the nominee answered my pre-hearing questions 
and also has completed a Committee Questionnaire for 
Presidential Nominees, which will appear in the hearing record. 
Also included will be a letter from the Office of Government 
Ethics acknowledging that the nominee is in compliance with the 
laws and regulations governing conflicts of interest. In 
addition, Admiral Dunne's complete statement will be printed as 
part of the record of these proceedings.
    I would like to at this time acknowledge the presence of 
the Deputy Secretary of Veterans Affairs, Gordon Mansfield, who 
I met before he appeared in this room today. He is joining us 
today at this confirmation hearing at the request of Secretary 
Peake. Secretary Mansfield, I want to thank you for your 
service. I appreciate the relationship you have with the 
Department of Defense and how you have worked well with Deputy 
Secretary England in talking about issues for our military and 
our veterans. So, thank you very much for being here, Secretary 
Mansfield.
    Before I administer the oath to Admiral Dunne, I would like 
to call on our Ranking Member, Senator Richard Burr, for his 
statement.

        STATEMENT OF HON. RICHARD BURR, RANKING MEMBER, 
                U.S. SENATOR FROM NORTH CAROLINA

    Senator Burr. Aloha, Mr. Chairman. Thank you not only for 
holding this hearing, but thank you for the comments that you 
just made. I think it is particularly important--there is a 
tendency in this institution at some late date to leave the 
word ``acting'' in front of somebody's name. This is clearly an 
individual that deserves to have that part dropped.
    Gordon, it is great to see you here today and thank you for 
being here to support the Admiral as we consider the 
nomination.
    Admiral, welcome to you and to your family. I intended to 
say to your family a minute ago that the seeming lack of 
participation is a good thing. I don't want you to take that as 
a bad thing. That is an indication that people aren't 
concerned. They have tremendous confidence. With the arrival of 
two additional Members, I look at them and would still tell 
you, don't worry. They are individuals that take very seriously 
the leadership that we have at the Department of Veterans 
Affairs. And we are all, collectively--us on this side as well 
as you, Admiral, and the staff that you have--anxious to sort 
out the benefits area as quickly and as efficiently as we can. 
And I personally know that that is your goal.
    Some of the biggest challenges will involve the processing 
of claims. We all know the system has been plagued with many 
years of challenges and large backlogs and long delays. In 
fact, despite recent boosts in funding and staffing, it is 
still taking about 6 months to get decisions to veterans. There 
are more than 390,000 pending claims, among the highest level 
in 10 years. I know you think this is unacceptable, as does 
Congress.
    Also, VBA still uses a largely paper-based claims 
processing system. This can cause delays and frustrations from 
our Nation's veterans whose files must be physically moved from 
one place to another, and only one person can work on a file at 
a time. I think most would agree that moving to a modern 
electronic system is long overdue.
    There are also large differences in the services that are 
provided by VA's 57 regional offices around the country. Some 
have consistently exceeded expectations while others have 
historically struggled. On top of that, VA's Disability Rating 
Schedule, which is the cornerstone of the entire claims 
process, has been outdated for many years and it needs to be 
updated.
    Now, I don't sit here today with any strong beliefs that 
between now and the end of next week, we are going to solve 
that, yet that seems to be the timeline that we are on. But I 
believe that the work that you do between now and the end of 
this year will pave the way to our ability, collectively, 
between Congress, the VSOs, and the Department, to change that 
system into a 21st century disability system: one that is 
understandable; one that is manageable. More importantly, one 
that truly does reach the needs of our veterans in a timely 
fashion.
    Also, VBA is in the process of implementing the new 
veterans' education program. It would require an extraordinary 
effort to do that by next fall while making sure there is no 
disruption in service for our veterans or their families.
    Admiral, this is a big undertaking. With the benefits of 
your military career, your work at the VA, as both Assistant 
Secretary for Policy and Planning and Acting Under Secretary 
for Benefits, I am confident that you are prepared to lead VBA 
trough a very challenging period of time. You have extensive 
leadership experience, a lifetime of dedicated service to our 
Nation, and an understanding of the needs of our Nation's 
veterans, which I think is absolutely crucial.
    Admiral, I thank you for your willingness to serve and, 
more importantly, to serve our veterans and their families in 
the role of Under Secretary for Benefits. I hope that in the 
few months remaining you will set in motion the types of 
improvements that will benefit veterans' lives for years to 
come.
    Mr. Chairman, again, I want to thank you for holding the 
hearing. I intend to support Admiral Dunne's nomination. I hope 
the Committee will support this nomination. I hope the Senate 
will act quickly and that Members will find ways to get over 
differences they might have with some aspect of what VA as an 
agency does, and bury the hatchet to allow good people to 
actually serve in the capacity that I think will help our 
Nation's veterans. I would urge my colleagues for quick action 
on this confirmation.
    I thank the Chair.
    Chairman Akaka. Thank you very much, Senator Burr from 
North Carolina.
    And now from the State of Washington, we will hear from 
Senator Murray.

                STATEMENT OF HON. PATTY MURRAY, 
                  U.S. SENATOR FROM WASHINGTON

    Senator Murray. Thank you very much, Chairman Akaka, 
Senator Burr. I really appreciate you holding this hearing 
today on the nomination of Admiral Patrick Dunne. If he is 
confirmed to be head of the VBA, he will be responsible for a 
$52 billion budget that provides compensation and pensions to 
nearly four million veterans and survivors; administer the G.I. 
Bill and VA Home Loan Guarantees; and will be responsible for 
many other programs, as well.
    At a time of war, I think it is especially important that 
we do everything in our power to make sure that the benefits 
that we do provide to our veterans meet today's needs and don't 
lag behind. Mr. Chairman, I am sure I speak for every Member of 
this Committee and every Member when I say that our country has 
an obligation to give our servicemembers everything they need 
from the time they begin basic training to deployment to when 
they return home.
    But still, too often today when I talk to veterans in my 
home State of Washington, I hear stories from veterans who are 
forced to wait months, if not years, to get their VA claims 
processed. I hear stories about veterans with the same illness 
getting vastly different ratings and benefits across the 
country. And I hear about the increasing complexity and number 
of claims being processed by the VBA.
    Now, this Congress has taken some concrete steps to address 
these problems, but there remains an awful lot of work left to 
be done. The list of challenges facing the VBA right now is 
really long, but if confirmed, the time Admiral Dunne will have 
to tackle them is extremely short. So, I look forward to 
hearing from you today, Admiral, about how you are going to 
prioritize the many challenges that are facing the VBA today.
    I also look forward, Mr. Chairman, to hearing from Admiral 
Dunne about the implementation of the Post-9/11 G.I. Bill. We 
had a meeting last week with Admiral Dunne. I appreciate the 
time you took, and I talked about the number of concerns I have 
about the VA's plan to outsource the launch of this updated 
program and I look forward to more time to talk about that 
today during the question and answer period.
    But again, Mr. Chairman, thank you very much for holding 
this hearing and I appreciate the opportunity to talk to the 
Under Secretary--hopefully, soon, beyond acting--to deal with 
the issues facing our veterans today.
    Chairman Akaka. Thank you very much, Senator Murray.
    And now we will receive the statement of Senator Tester.

                 STATEMENT OF HON. JON TESTER, 
                   U.S. SENATOR FROM MONTANA

    Senator Tester. Thank you, Chairman Akaka, and thank you, 
Ranking Member Burr. I also appreciate this hearing. I want to 
welcome Diane, Patrick, and Erin. I appreciate your support of 
Admiral Dunne in his service to this country. I want to, of 
course, welcome you, Admiral Dunne, to this hearing. We have 
worked on some stuff in the past and I look forward to working 
with you during the remainder of your tenure.
    I think the Senator from Washington covered much of what I 
had to say. I appreciate your service and I look forward to 
your statement and look forward to the questions and answers 
that follow. What I am going to be looking for is: your 
transition, your plans for transition to the next 
administration; implementation of the 21st Century G.I. Bill; 
how you plan on implementing benefits, particularly for rural 
frontier areas. It is a big issue, contracting, those kinds of 
things--what your vision is for the VA in those areas.
    I can tell you that every time I go back to Montana--we 
have got a high percentage of veterans in the State, you know 
that--I do hear about discrepancies in ratings and things like 
that. So, hopefully, we can also have a discussion about that 
ratings schedule and the template and your vision for moving 
forward on that, because I agree with Senator Burr. I think it 
does need to be modified, updated, whatever you want to call 
it.
    So, thank you. I look forward to the hearing. Thank you, 
Chairman Akaka.
    Chairman Akaka. Thank you very much, Senator Tester.
    Now, may I ask Admiral Dunne to please stand to take the 
oath and repeat after me. I, Patrick Dunne, swear to tell the 
truth----
    Admiral Dunne. I, Patrick Dunne, swear to tell the truth--
--
    Chairman Akaka [continuing]. The whole truth, and nothing 
but the truth, so help me, God.
    Admiral Dunne [continuing]. The whole truth, and nothing 
but the truth, so help me, God.
    Chairman Akaka. Thank you. Will you please proceed with 
your statement, Admiral.

    STATEMENT OF HON. PATRICK W. DUNNE, NOMINEE TO BE UNDER 
     SECRETARY FOR BENEFITS, DEPARTMENT OF VETERANS AFFAIRS

    Admiral Dunne. Mr. Chairman, Senator Burr, Senator Murray, 
Senator Tester, good morning and thank you for the opportunity 
to testify today. I am honored and humbled to be nominated by 
President Bush to serve as Under Secretary for Benefits at the 
Department of Veterans Affairs. I am also most grateful to 
Secretary Peake and the Selection Commission for their 
confidence in me.
    Mr. Chairman, thank you for acknowledging my family this 
morning. They are very important to me and I am, indeed, 
grateful for their constant love and support.
    Twenty-six months ago, when I appeared before this 
Committee for confirmation to my current position, I spoke of 
my commitment to public service based on a respect and 
appreciation for the personnel who I served with in the United 
States Navy. Today, my commitment is strengthened by my first-
hand interactions, not only with our many veterans who rely on 
VA, but also with the many dedicated VA employees who serve 
those veterans.
    As a Member of the Task Force on Returning Global War on 
Terror Heroes and the Senior Oversight Committee, I have been 
privileged to contribute to the efforts to improve all aspects 
of the continuum from active or reserve duty to veteran status. 
If I am confirmed, I am prepared to continue working with my 
fellow VA employees, the Department of Defense, and Congress to 
ensure our veterans are aware of their benefits, can easily 
apply for them, and receive an accurate and timely decision to 
their application.
    To accomplish this, I think there are three areas that 
require continuous effort. First, communications with our 
veterans and servicemembers are essential.
    Second, the best tools available via technology must be 
provided to our employees to help them work accurately and 
expeditiously. In addition, we must allow veterans to 
communicate with us electronically, consistent with the latest 
technology.
    Third, I intend to ensure that every VBA employee has the 
requisite training to be effective in his or her job. 
Technology is not the magic wand that will deliver benefits 
rapidly and accurately. Rather, we need a well-trained 
workforce that can effectively use those tools.
    But in the end, I think it is about leadership, and that is 
why I seek your confirmation. I am prepared to provide the 
leadership necessary to ensure VBA moves ahead with electronic 
processing, reaches out to all our veterans and servicemembers, 
and responds to their requests in the minimum time with an 
accurate answer.
    The Under Secretary for Benefits is also a member of the 
One VA Team, and if confirmed, I intend to give my very best 
effort to work diligently with the other administrations and 
faithfully advise the Secretary and Deputy Secretary.
    Mr. Chairman and Members of the Committee, thank you again 
for your consideration of my nomination and I would be happy to 
answer any questions you may have.
    [The prepared statement of Admiral Dunne follows:]
Prepared Statement of Patrick W. Dunne, Nominee for Under Secretary for 
                Benefits, Department of Veterans Affairs
    Mr. Chairman, Senator Burr, and Members of the Committee, good 
morning. Thank you for the opportunity to testify today. I am honored 
and humbled to be nominated by President Bush to serve as Under 
Secretary for Benefits at the Department of Veterans Affairs. I am also 
most grateful to Secretary Peake and the selection commission for their 
confidence in me.
    With me today are my wife, Diane; my daughter, Erin; and son, 
Patrick. I am very grateful for their constant love and support.
    Twenty-six months ago when I appeared before this Committee for 
confirmation to my current position, I spoke of my commitment to public 
service based on a respect and appreciation for the personnel who I 
served with in the United States Navy.
    Today, my commitment is strengthened by my first-hand interactions, 
not only with many of our veterans who rely on VA, but also with the 
many dedicated VA employees who serve those veterans. As a member of 
the Task Force on Returning Global War on Terror Heroes and the Senior 
Oversight Committee, I have been privileged to contribute to the 
efforts to improve all aspects of the continuum from active or reserve 
duty to veteran status.
    If I am confirmed, I am prepared to continue working with my fellow 
VA employees, the Department of Defense, and Congress to ensure our 
veterans are aware of their benefits, can easily apply for them, and 
receive an accurate and timely decision to their application.
    To accomplish this, I think there are three areas that require 
continuous effort.
    First, communications with our veterans and servicemembers are 
essential.
    Second, the best tools available via technology must be provided to 
our employees to help them work accurately and expeditiously. In 
addition, we must allow veterans to communicate with us electronically, 
consistent with the latest technology.
    Third, I intend to ensure that every VBA employee has the requisite 
training to be effective in his or her job. Technology is not the magic 
wand that will deliver benefits rapidly and accurately. Rather, we need 
a well-trained work force that can effectively use those tools.
    But in the end, I think it is about leadership, and that is why I 
seek your confirmation. I am prepared to provide the leadership 
necessary to ensure VBA moves ahead with electronic processing, reaches 
out to all our veterans and servicemembers and responds to their 
requests in the minimum time with an accurate answer.
    The Under Secretary for Benefits is also a member of the One VA 
team, and if confirmed, I intend to give my very best effort to work 
diligently with the other Administrations and faithfully advise the 
Secretary and Deputy Secretary.

    Thank you again, Mr. Chairman and Members of the Committee, for 
your consideration of my nomination. I would be happy to answer any 
questions you may have.

    [The Committee questionnaire for Presidential nominees for 
Admiral Dunne follows:]



    [A letter from the Office of Government Ethics follows:]

    



                                 ______
                                 
  Response to Written Questions Submitted by Hon. Daniel K. Akaka, to 
     Patrick W. Dunne, Nominee to be Under Secretary for Benefits, 
                     Department of Veterans Affairs
    Question 1. What do you believe are the most important problems and 
challenges currently confronting VBA? Which of these problems and 
challenges will you focus on and how do you intend to address them 
during what may be a short term in office? How might you set the stage 
for the next administration's work?
    Response. Through my experience as the Department of Veterans 
Affairs (VA) Assistant Secretary for Policy and Planning and my work as 
a member of the VA Department of Defense (VA/DOD) Strategic Oversight 
Committee and Joint Executive Council, I have a strong understanding of 
the issues and challenges facing the Veterans Benefits Administration 
(VBA) as we work to proactively support our returning service men and 
women in their readjustment and reintegration to civilian life and 
deliver timely and accurate benefits to veterans of all eras.
    I believe there are three areas that require continuous effort. 
First, improving communications with our veterans is critical. Second, 
the best tools using technology must be provided to our employees to 
help them work accurately and expeditiously. In addition we must allow 
veterans to communicate with us electronically consistent with the 
latest technology. Third, I intend to ensure that every VBA employee 
has the requisite training to be effective in their job. Technology is 
not the magic wand that will deliver benefits accurately and rapidly. 
Rather, we need a well-trained work force that can effectively use 
those tools.
    I am prepared to provide the leadership necessary to ensure VBA 
moves ahead with electronic processing, reaches out to all our veterans 
and servicemembers, and responds to their requests in the minimum time 
with an accurate answer. My top priorities include improving the 
timeliness and quality of benefits delivery, transitioning to paperless 
claims processing, training, and implementing the new GI Bill. If 
confirmed, my strategy will be to provide strong management attention 
to the initiatives currently underway and continue to examine the 
business processes we use to serve veterans.

    Question 2. What is your management style? Are you a ``hands-on'' 
manager? Do you rely on significant delegation? Do you seek consensus 
with those on your management team before making a decision or do you 
generally gather relevant information and input, and then make a 
decision?
    Response. Certainly in an organization as large as VBA and with the 
complexity of the programs that VBA administers, significant authority 
must be delegated. However, I consider myself a ``hands on'' manager in 
that I am actively involved and engaged in all major operational and 
policy issues and aggressively follow up to ensure progress is achieved 
and accountability maintained. While achieving consensus in some 
instances is appropriate, if confirmed, I will seek the best technical 
advice and input from subject matter experts and make key decisions--
with or without consensus.

    Question 3. One of the biggest challenges that VA is facing is the 
implementation of the new Post-9/11 GI Bill, which was signed into law 
on June 30, 2008. The full effective date of the new program of 
educational assistance is August 1, 2009, which means that VA has less 
than 1 year to prepare for massive changes. What are your thoughts on 
how VA might best prepare for implementation of the new program?
    Response. First, communicate to veterans the details of the program 
so that those who are eligible and desire to participate are ready to 
apply as soon as the application process begins. We are already using 
the internet, call centers, and the media to provide information.
    Second, VA does not currently have an information technology (IT) 
system capable of implementing this program. We moved expeditiously to 
procure the IT development capabilities needed. The goal is to apply 
current technological standards to create a rules-based system which 
will expeditiously and accurately enroll our veterans and make the 
necessary payments.
    Third, ensure VA employees are properly trained to provide the 
necessary oversight of the IT solution and be prepared to intervene 
under circumstances that do not fit the rules-based engine.

    Question 4. Concerns have been raised to me about VA's decision to 
utilize the services of a contractor for initial implementation of the 
new program. Please share your thoughts and any concerns you may have 
regarding this decision.
    Response. The new eligibility and payment structure created by the 
Post-9/11 GI Bill is a significant departure from VA's current payment 
system, and is far more complex than the current monthly payments made 
under other benefit programs. VA's existing eligibility and payment 
system, developed in the 1970's, is unable to support the new structure 
required for implementation of this program. To meet the statutory 
deadline of the Post-9/11 GI Bill, VA is seeking private-sector 
contractor support to develop and provide an IT solution for a new 
eligibility and payment process.
    Based on the implementation strategies being pursued, VA does not 
anticipate the loss of Federal employment for any present VA education 
employees. Since the Post-9/11 GI Bill will result in tuition and fee 
payments being made to educational institutions, some current claims 
processing resources will be shifted to increased compliance and 
oversight responsibilities. VA employees will continue to staff and 
operate the nationwide Education Call Center in Muskogee. VA employees 
will also continue to respond to all on-line inquiries received through 
the VA Web site, including Post-9/11 GI Bill inquiries.

    Question 5. In your view, how long should a veteran have to wait to 
have his or her initial claim for compensation adjudicated?
    Response. The transition between military and civilian life can be 
challenging for all servicemembers, but especially to those who have 
incurred a disability in the military. I believe the benefits delivery 
at discharge process, the goal of which is to deliver benefits within 
30 to 60 days of separation, is the best method. I will continue to 
work with my counterparts at DOD to expand the program beyond the 
current 152 sites and work to ensure benefits information is provided 
to servicemembers at the earliest possible time so that more claims are 
received prior to discharge.

    Question 6. Describe how you intend to work with the Secretary and 
two other Under Secretaries.
    Response. If confirmed, as a member of the ``One VA'' team, I 
intend to give my very best effort to work diligently with the other 
administrations and faithfully advise the Secretary and Deputy 
Secretary.

    Question 7. How do you plan to work with the veterans service 
organizations? Do you anticipate meeting with the VSO representatives 
on a regular basis?
    Response. I understand and appreciate the important partnership VA 
has with the veterans service organizations (VSO). I plan to work 
collaboratively with the VSOs--and with complete transparency. I have 
had several opportunities since April 2008 to discuss issues with VSO 
representatives and have found these sessions very helpful. If 
confirmed, I intend to continue to regularly consult with them in the 
future.

    Question 8. VBA has come under fire for the lack of timeliness of 
its claims processing. While VBA has made progress in improving 
timeliness and accuracy of disability claims processing, further 
improvement is needed. VBA turned its attention to decreasing the 
amount of time it takes to process a claim, but that improvement seems 
to be at the cost of a decrease in the quality of its decisionmaking. 
Do you have any views on how a more balanced approach can be reached?
    Response. In my short tenure as Acting Under Secretary, I have 
participated in numerous discussions with Secretary Peake and VBA staff 
on the issue of claims accuracy. We are currently closely tracking not 
just production but also accuracy of the production. I believe all 
those involved in claims processing are dedicated to getting it right 
the first time. Accuracy means less rework and therefore increased 
production. I am aware that the former Under Secretary made 
considerable investments in training programs, and I believe this is 
critical to the future success of VBA. I also believe a robust system 
of oversight and quality assurance is an essential component of a 
balanced approach to claims processing. Improvements will be achieved 
with appropriate levels of resources, more and better training, and up-
to-date tools and technologies to support the decisionmaking and 
oversight process. If confirmed, I will explore all avenues to improve 
decision accuracy and consistency, as well as claims processing 
timeliness.

    Question 9. Accurate forecasting of usage of veterans benefits is 
essential in planning for resources to administer those benefits. What 
do you see as the Under Secretary's role in forecasting the need for 
additional staffing resources so that Congress can appropriate those 
resources in a timely manner?
    Response. If confirmed as Under Secretary, I will monitor program 
needs and analyze usage and performance data to ensure that VBA 
appropriately addresses the needs of the veterans we are charged to 
serve. I will also ensure strategic plans are formulated to ensure we 
are accurately addressing staffing and other budgetary needs. An open 
dialog will be maintained with stakeholders, including Congress, to 
proactively address resource issues.

    Question 10. Many in the newest generation of veterans are 
technologically savvy. Veterans can submit claims for compensation over 
the Internet. However, such applications are not integrated into the 
claims process. Do you believe VA has a role in improving the use of 
technology for the processing of initial applications for compensation 
and to aid in the timeliness and accuracy of claims adjudication?
    Response. I believe that the best technological tools must be 
provided to our employees to help them work accurately and 
expeditiously and that we must allow veterans to communicate with us 
electronically, consistent with the latest technology. Since appointed 
as Acting Under Secretary for Benefits, I have aggressively worked to 
develop the paperless delivery of veterans benefits initiative and 
achieve rapid progress. This initiative employs a variety of enhanced 
technologies to support end-to-end claims processing. In addition, I 
have directed that we redesign and enhance our existing on-line 
application process. As part of this redesign, the data supplied by the 
veteran will be integrated into the claims processing system to 
alleviate the redundant re-keying of information from the application. 
This redesign will also provide the framework for providing other types 
of ``self service'' capabilities to veterans, such as change of address 
or banking information, checking the status of a pending claim, and 
submission of evidence.

    Question 11. For some medical conditions that occur after service, 
the scientific information needed to connect the medical condition and 
the circumstances of service may be incomplete. When information is 
incomplete, Congress or the Secretary of Veterans Affairs has authority 
to presume disabilities and diseases as service-connected for purposes 
of compensation. If confirmed as Under Secretary, what would be your 
approach for recommending whether presumption is warranted?
    Response. I believe presumptions are appropriate when information 
and the state of medical knowledge are incomplete and, as a result, 
there is a substantial risk that meritorious claims would otherwise be 
denied. However, any decisions must be fully informed, and supported 
and guided by the medical science that does exist.

    Question 12. At the present time, military recruiters are actively 
recruiting servicemembers from countries in the Pacific Islands, such 
as the Federated States of Micronesia. Some veterans' benefits, such as 
vocational rehabilitation services, VA home loans, and health care are 
not normally provided outside of the Untied States. In your view, what 
obligation does the government have to provide non-citizen disabled 
veterans benefits and services needed to compensate for and overcome 
the disabilities which they incurred after being recruited into United 
States military service?
    Response. During my tour as Commander, Naval Forces Marianas, I had 
the opportunity to work with many of the fine servicemembers in 
Micronesia, so I am somewhat familiar with the challenges in that part 
of the world. I believe that all disabled veterans, both United States 
citizens and non-citizens, are entitled to the benefits they earned 
through their military service. I have been advised that VA-guaranteed 
home loans cannot by regulation be made to veterans living outside the 
United States and its territories because of problems in administering 
the benefit to veterans in foreign countries where there is no VA 
presence. However, VA is revising the Specially Adapted Housing (SAH) 
regulations so that, as authorized by Section 2602 of Public Law 110-
289, veterans living outside the United States can take advantage of 
the SAH program. Additionally, the law does not provide for independent 
living services outside the United States. However, other vocational 
rehabilitation programs and services can be provided to both citizen 
and non-citizen veterans living outside the United States. VA also 
furnishes veterans living outside the United States with medical care 
and services for the treatment of their service-connected disabilities.

    Question 13. In 2004, a blue-ribbon panel completed an exhaustive 
review of VA's Vocational Rehabilitation and Employment program. In its 
findings, it made more than 100 recommendations. Of those, VA reports 
that 88 recommendations have been implemented to some extent. I remain 
concerned, however, that there are far too many eligible veterans who 
do not apply, complete the evaluation process, have a rehabilitation 
plan developed, or complete their plan. No one seems to really know why 
there is such a low completion rate when measured against the number of 
veterans who apply and who are determined entitled. What priority do 
you believe VA should place on determining why the successful 
completion rate for individuals in this program is so low?
    Response. I believe that the Vocational Rehabilitation and 
Employment (VR&E) program is a key benefit program, crucial to the 
successful transition of disabled veterans. I am committed to ensuring 
that veterans are aware of the VR&E program and that the program meets 
its commitment to assist disabled veterans throughout the transition 
process to achieve their individual rehabilitation goals. As Assistant 
Secretary for Policy and Planning, I directed the planning to contract 
for a complete program evaluation of VA's VR&E program. This evaluation 
will examine the outcomes of our VR&E veteran population and why 
individuals discontinue the program, as well as a customer satisfaction 
study. If confirmed, I will make certain that a high priority is given 
to identifying and resolving any issues that may be impeding some 
veterans from successfully completing the program.

    Question 14. VA's Vocational Rehabilitation and Employment program 
is one of the smallest, yet most important, programs within the 
Department. It is the linchpin for helping veterans who incur service-
connected disabilities achieve a fulfilling and gainful future. I am 
deeply committed to making sure that this program lives up to its full 
potential, especially when individuals who have sustained serious 
injuries in combat are concerned. What are your thoughts on the role 
that vocational rehabilitation plays in terms of the total 
rehabilitation of an individual recovering from severe combat-related 
injuries?
    Response. I agree that the VR&E program is vitally important to the 
successful transition of veterans with service-connected disabilities, 
particularly those with disabilities resulting from combat-related 
injuries. I am aware that the VR&E program provides a continuum of 
services that help veterans adjust to their disabling conditions and 
translate their military experience into marketable civilian skills, so 
that they can obtain and maintain meaningful careers in the civilian 
job market. Helping disabled veterans find meaningful jobs is one of 
the most important transitional services VA can offer. I believe of 
equal importance are the independent living services provided to the 
most seriously disabled veterans who are unable to work to enable them 
to live more independently in their communities.

    Question 15. Through VA's vocational rehabilitation program, VA 
assumes certain responsibilities for the provision of employment 
assistance to veterans who complete a plan of vocational 
rehabilitation. This assistance can take a variety of forms. I am 
concerned that VA cooperate and coordinate with the Department of 
Labor's Veterans' Employment and Training Service so that duplication 
of effort can be minimized. If confirmed as Under Secretary, what will 
you do to involve both DOL and DOD in efforts to ensure that 
employment-related issues are addressed seamlessly and without 
duplication of effort?
    Response. Since mid-2007 I have served as an ex-officio member of 
the Secretary of Labor's Advisory Committee on Veterans Employment 
which is coordinated by Charles Ciccolella, Assistant Secretary for 
Veterans Employment and Training Service, Department of Labor. Together 
we have used this as a forum to coordinate our efforts with both the 
Department of Labor and DOD. In addition, the action items from the 
Task Force on Returning Global War on Terror Heroes have contributed to 
our collective efforts through job fairs and the transition assistance 
program. If confirmed, I plan to continue these efforts.

    Question 16. Under the VA's vocational rehabilitation program, 
there is authority for a program of independent living services for 
individuals who are severely disabled. However, there is an annual cap 
of 2,500 enrollees in this program. Concerns have been expressed that 
this enrollment cap may be adversely impacting the provision of 
services to those most severely injured in combat. Do you believe that 
this cap is appropriate or should these services be available to all 
who need them?
    Response. Independent living services must be available to all 
service-connected veterans who need them. Although I have been advised 
that the cap is not a barrier at this time to providing independent 
living services to any eligible veterans, if confirmed I will monitor 
this issue closely to ensure VR&E is providing services to all 
qualified veterans.

    Question 17. Under current policies, there is a protracted period 
of evaluation and multiple reviews of decisions concerning seriously 
disabled veterans seeking independent living services. If confirmed, 
will you look into what steps might be taken to shorten the evaluation 
period and reduce the layers of the review?
    Response. Yes, I will look into that if confirmed.

    Question 18. VHA has had considerable success using electronic 
health records. What are your views on how technology might be used to 
address problems that arise from VBA's reliance on paper files?
    Response. My vision is that those veterans who choose to 
communicate with VA electronically should be able to do so through an 
interface which incorporates the best tools available. For those 
veterans who choose to communicate with VA by paper, VA should be able 
to expeditiously convert that into an electronic file. I believe the 
standard should be that, as a servicemember transitions, all the 
appropriate administrative and medical records are immediately 
transmitted from DOD to VA and become part of the veteran's electronic 
file.

    Question 19. In 1941, Congress passed legislation, which, in 
recognition of the difficulty of using official military records to 
establish the disability of veterans who were disabled in combat areas, 
provided for a relaxed evidentiary standard in the case of claims from 
veterans who served in combat areas. It has recently come to my 
attention that VA defines ``combat'' very narrowly when applying this 
standard, requiring a veteran claimant to produce proof of direct 
combat with an enemy. Do you believe this is an appropriate definition 
of ``combat?''
    Response. 38 U.S.C. Sec. 1154(b) currently enables ``any veteran 
who engaged in combat with the enemy'' to establish service incurrence 
for an injury or disease using only lay evidence. The United States 
Court of Appeals for the Federal Circuit has held that ``[t]he statute 
does not provide a relaxed standard of proof for determining whether a 
veteran engaged in combat.'' Rather, according to the court, a veteran 
must first establish that he or she engaged in combat with the enemy in 
order for a veteran to be able to show service incurrence for an injury 
or disease under the standards provided by 38 U.S.C. Sec. 1154(b).
    A number of decisions from the Court of Appeals for Veterans Claims 
deal with defining combat status and the evidentiary standards to apply 
when determining such status. However, I understand the most recent 
combat-related holding is from the Federal Circuit in the case of Moran 
v. Peake (2008). The court held that:

        ``the term `engaged in combat with the enemy' in Sec. 1154(b) 
        requires that the veteran have personally participated in 
        events constituting an actual fight or encounter with a 
        military foe or hostile unit or instrumentality, as determined 
        on a case-by-case basis. A showing of no more than service in a 
        general `combat area' or `combat zone' is not sufficient to 
        trigger the evidentiary benefit of Sec. 1154(b).''

    This is the definition followed by VA.

    Question 20. VBA has had some success in the past with improving 
the efficiency of claims processing by consolidating certain services 
into fewer offices. What are your views on the pros and cons of such 
consolidation?
    Response. I am aware that VBA's prior consolidations in education, 
loan guaranty, and insurance resulted in improved timeliness, quality 
and consistency of benefit decisions, as well as overall improved 
customer service. As Acting Under Secretary for Benefits, I have 
reviewed and approved the continuation of consolidation initiatives 
that include all original pension claims processing to the three 
pension management centers, general inquiry phone calls to nine 
national call centers, and the future consolidation of survivors' 
benefits processing.
    Many organizations studying disability claims processing have 
suggested that VBA's challenges could be addressed by more 
comprehensive restructuring and consolidation than has been done to 
date. Potential benefits of greater consolidation of disability claims 
processing activities would include:

     Improved efficiency
     Greater decision accuracy and consistency
     Facilitate the delivery of training and quality control 
efforts
     Reduced administrative overhead and infrastructure costs
     Optimize our ability to recruit and retain qualified staff
     Availability of greater processing expertise, particularly 
in critical technical areas

    If confirmed, I will continue to examine areas for potential 
consolidation to better serve veterans. However, as VA's past 
experience has proven, consolidation is not just a shift in human 
resources and real estate, but often a complex process that requires 
input and support from service organizations, Members of Congress, and 
other stakeholders. Even with greater consolidation, VA must maintain a 
presence in each geographical region in order to meet the unique needs 
of veterans and ensure all veterans have access to VA benefits 
information and services.

    Question 21. What changes do you anticipate making to the way 
quality is measured at VBA?
    Response. Based on my experience to date with VBA's systematic 
technical accuracy review program, I believe it is technically sound, 
but should be expanded. VBA is now significantly increasing the 
national quality assurance staff to add review areas previously not 
covered, expand the rating consistency review program started in fiscal 
2008, and increase regional office sample numbers. If confirmed, I will 
continue to support this effort.

    Question 22. Short of a legislative solution, what actions do you 
intend to take to ensure the continuity of the Senior Oversight 
Committee process in the next administration?
    Response. I am working with my DOD counterpart as co-chair of the 
Senior Oversight Committee integrated process team to ensure all action 
items from the lines of action are incorporated into the Joint 
Strategic Plan, which will be finalized before the end of the year. I 
reorganized the Office of Policy and Planning staff and directed hiring 
additional personnel to work exclusively on coordination of issues with 
DOD. We continue to work with DOD to properly align the duties of the 
VA/DOD Joint Executive Council work groups with those of the lines of 
action.

    Question 23. The VA IG recently identified problems in 2006 with 
sending VBA sending benefit packets to recently separated reservists. 
What is VBA doing to ensure that all who previously did not receive 
benefits packets now receive them?
    Response. In early 2008, VBA identified problems with the Veterans 
Assistance at Discharge System (VADS) process. VBA is unable to 
determine which separated reservists did not receive benefits packets 
during 2006. However, immediate corrective actions were taken to ensure 
that all separating servicemembers now receive the benefits packages. 
Staff at the Austin Automation Center were given access to contract 
locator services to obtain correct addresses for packages that are 
returned as undeliverable. Additionally, VBA is investigating methods 
to switch to a real-time data feed from the Defense Manpower Data 
Center rather than relying on the current process of waiting on DOD to 
provide us with a hard copy DD-214. This will allow VBA to issue the 
Welcome Home Package more efficiently and timely.

    Question 24. I am interested in hearing about your view of the 
IOM's report for the VDBC on Evaluation of the Presumptive Disability 
Decision-Making Process for Veterans. That IOM Committee recommended a 
new process for VA to follow in establishing presumptions. Can you 
please comment on your view of this new process?
    Response. VA's current policies are consistent with many of the 
suggestions contained in the report. However, the Institute of Medicine 
(IOM) recommended changes to the process that included a more stringent 
standard of evidence and the establishment of new advisory committees. 
These are policy considerations that have not been vetted in the 
Department, and I have formulated no opinion on them.

    Question 25. With respect to presumptive disability decisionmaking, 
IOM also recommended a standard of ``causal effect.'' In some cases, 
servicemembers may have been subjected to multiple potential exposures 
of uncertain dosage. If causation is unclear, should evidence of 
increased incidence of certain disabilities be a basis for service-
connection?
    Response. I am advised that a standard of ``causal link'' is a 
higher standard of proof than VA has traditionally used in establishing 
presumptions. Using that standard would, most likely, result in fewer 
disabilities being designated as presumptives. This is a policy 
consideration that has not been vetted in the Department, and I have 
formulated no opinion on it.
                                 ______
                                 
  Response to Written Questions Submitted by Hon. Bernard Sanders, to 
     Patrick W. Dunne, Nominee to be Under Secretary for Benefits, 
                     Department of Veterans Affairs
    Question 1. Admiral Dunne, the VBA disability claims processing 
process continues to be fraught with problems in decisionmaking that 
causes undue burden on veterans and results in inefficient allocation 
of scarce government resources.
    Specifically:

     The average claim takes 120 days to adjudicate; far from 
the 78-day VA goal.
     VBA admits 15% of its claims are inaccurate, but the true 
number is probably much higher. Recent data shows wide variations in 
payments to veterans by different regional offices, for example.
     A wave of VBA's most experienced raters are retiring, and 
at the same time the attrition rate for new raters is inexplicably high 
at 16% in their first year.
     The average veteran submits five claims.
     50% of veterans appeal their claim, adding further time 
and resources to the claims process.

    Given these longstanding and deep structural deficiencies, do you 
think there would be a benefit to the VBA of automating the VASRD (VA 
Schedule for Rating Disabilities)? Do you have any plans on moving 
forward with any VBA information technology enhancements between now 
and January? If so, please describe them.
    Response. In late fiscal 2007, the Office of Information and 
Technology supported the Veterans Benefit Administration's (VBA) market 
research of business-rules-engine software and other decision-support 
technologies that could be leveraged to support improved decisionmaking 
by claims processing personnel. During September 2008, the Department 
of Veterans Affairs (VA) will engage the services of a lead systems 
integration contractor (LSIC) to assist in refining and documenting 
VBA's strategy and requirements for a claims process that is less 
reliant on paper. This will include decision-support tools that can be 
used to enhance decisionmaking and evidence-gathering throughout the 
claims process, as well as streamline elements of claims workflow. We 
will continue to evaluate appropriate uses of business rules technology 
as part of our overall claims processing improvement strategy, 
including the disability rating process.
    The concept of operations for enhancing the claims process with 
automated decision support tools is part of the overall strategy for 
the paperless delivery of veterans benefits initiative. During the 
first quarter of fiscal 2009, the LSIC will assist VBA in examining the 
disability claims process to elicit the business requirements for the 
paperless initiative. The LSIC will advise VA on technologies available 
to enhance the business processes as well as to support the 
implementation of a more efficient business model. The initial hardware 
and software release in support of the paperless initiative is expected 
to be implemented in fiscal 2010. In parallel, VBA will continue its 
successful paperless claims processing efforts in the loan guaranty, 
insurance and education business lines. Paperless claims processing in 
the compensation and pension line of business will also continue to be 
enhanced, using the current virtual VA platform. The end-state hardware 
and software platform, designed by the LSIC to meet VBA's business 
requirements, is envisioned to replace the current virtual VA platform, 
and provide enhanced paperless claims processing capabilities across 
VBA.
    A core element of the paperless delivery of veterans benefits 
initiative is on-line self service. The existing veterans on line 
applications capabilities will undergo extensive modernization to 
increase efficiency and improve customer service. Enhancements will 
include the capability for E-authentication through an enterprise 
portal, offering the capability of identifying and authenticating 
veterans through the veterans information portal, which uses the 
Veterans Affairs Defense Identity Repository as a means of 
authentication.

    Chairman Akaka. Thank you very much, Admiral.
    Given the relatively short time you will hold office and 
that VBA is facing seemingly unsurmountable challenges, what do 
you think you can accomplish in these few remaining months?
    Admiral Dunne. Sir, as you mentioned, it is a big 
challenge, and I think what I can accomplish is to set a plan 
in motion which we can continue to progress along as we are 
currently, taking advantage of technology. Recently, last 
month, I established a billet for a long-range planner. I hired 
a veteran last month who has planning experience, both short-
range and long-range, to come in and work closely with me and 
to gather up the efforts of the senior executives within VBA so 
that we establish a plan for the G.I. Bill implementation, for 
paperless implementation, and for really taking a look at the 
claims process; and seeing, while we are waiting for the 
technology to get us paperless, what parts of our business 
process we can modify, reevaluate, and change. So, we are in 
the process of building a plan over the next several months 
which we will be able to turn over in January.
    Chairman Akaka. How do you think you will prepare VBA and 
your successor for the transition that will likely occur with 
the next administration?
    Admiral Dunne. Mr. Chairman, as part of this plan, we will 
have a detailed analysis of those items that need to be 
completed, monitoring and managing the parts of the contract, 
ensuring--the different contracts, ensuring that the proper 
training is available to all our VBA employees so that they can 
continue on. As you know, we have hired almost 3,100 new 
employees. Many of them are still in the stage of completing 
their training to get to the journeyman status. We need to 
follow through on those and be prepared.
    Chairman Akaka. Admiral, I understand that it may be 
necessary to reach outside of VA for assistance in implementing 
the new Post-9/11 G.I. Bill in a smooth and seamless fashion. 
However, I believe strongly that outsourcing the processing of 
these important benefits on a permanent basis would be very 
ill-advised. Do you have plans for bringing this function back 
into VA in the future?
    Admiral Dunne. Mr. Chairman, in the implementation of all 
our education programs, our knowledgeable VA employees are the 
crux of the process and we are going to rely on them just as 
much under the new G.I. Bill Program as we are on the current 
one. As you know, our IT capabilities are such that the 
timeline that we need to work on and the complexity of the 
benefit is such that we needed to bring in outside assistance 
to develop an IT system capable of doing that. I would intend 
to work with the Chief Information Officer to make sure that we 
have those capabilities in-house which are necessary for us to 
be able to serve veterans. So, the priority is to be able to 
serve veterans; and I will work closely with the CIO on those 
IT issues that we currently have to contract out to make sure 
we are doing them in the best manner, sir.
    Chairman Akaka. Well, thank you. I have further questions 
for another round. Let me call on our Ranking Member, Senator 
Richard Burr, for his questions.
    Senator Burr. Thank you, Mr. Chairman. I will be very 
brief. I want to explore the same area, because I would like 
every Member to be very clear on exactly how you envision 
implementation and the specific areas where contractors may be 
used. In a conversation that we had, I believe that you 
highlighted the need to use contractors to create the software 
program to implement the G.I. Bill, and the potential to use 
contractors to actually make the payments. I think those 
payments were the payments, specifically, that dealt with the 
housing allowance, because there are incredible variations on 
where that is.
    Now, I had the opportunity to sit down after I met with you 
and after we had the American Legion meeting last week, which 
the Chairman and I attended, where they were outraged at the 
thought of contracting. It just so happened that, an hour 
later, I sat down with you and got it from the horse's mouth. 
Here is what we are trying to do. Later in the day, I had 
Legion members come in and explained to them that we don't have 
the capabilities within the Federal Government. We have tried 
before at the FBI and spent a billion dollars to find out the 
billion dollars created a program that we couldn't use and we 
had to throw it away. So, I applaud the fact that we are 
recognizing that writing software is not our strength, that the 
outside world, the private sector does it better.
    When I referenced the fact that the payment might come from 
an outside vendor that is processing the checks--the VA is 
intricately involved in determining who qualifies and where 
they live--but the processing of that payment may be from 
outside, they said, we don't care who processes and sends the 
check as long as we get the check.
    Now, have I simplified it too much from the standpoint of 
your incorporating outside vendors? Is there an area that we 
should be concerned with or alarmed? I might say to the 
Chairman's question, I am not sure that either of the areas is 
necessarily something that I envision that I would like to move 
back in because I think, historically, government doesn't do 
that piece real well. I point to numerous agencies that make 
payments, that my staff spends hundreds of hours trying to 
chase down Social Security payments, hundreds of hours trying 
to chase down IRS payments. The thought that we could turn it 
over to somebody to process in a timely fashion and, more 
importantly, to make sure that a check actually got to the 
person whose address it is supposed to get to, is refreshing to 
me. I turn it to you to correct me anywhere I might be wrong.
    Admiral Dunne. No, thank you, Senator. You have the essence 
of where we are headed. We are implementing the Post-9/11 G.I. 
Bill today and VA employees are involved in that, as they 
should be. We are staffed up at the Education Call Center to 
answer questions from veterans now so that they are ready to 
apply when it is time to apply next summer to go to school. We 
are manning the Internet Web site that we have. VA employees 
are answering questions from veterans on that Web site as they 
come in. And that is how they should be involved.
    As you mentioned, due to the complexity of the different 
payments, we do not currently have the IT capability to do 
that. We have payment systems that pay compensation, that pay 
pension, et cetera, but they are not configured to make the 
payments that are required under this new G.I. Bill.
    So, what we are contracting for is to build a service and 
have a contractor provide us a service through software which 
is rules-based. In essence, this new program--we are taking the 
opportunity to bring the right technology tools to the VA 
decisionmakers from the start. We want to bring the best of 
technology. One of the things that we understand technology can 
do is provide us this rules-based engine, which in many cases a 
servicemember or veteran would be able to go to his or her 
computer, log in, answer the questions that establish their 
eligibility, and hit ``submit.'' It goes to the computer 
program, the rules of which have been determined by VA 
employees.
    If everything matches as the computer's logic has been 
told, then a letter would go to the veteran, servicemember, 
saying you are accepted in the program. We are going to make 
the payments to your college that you have told us that you are 
going to. You will get your housing benefits in this amount on 
a monthly basis, et cetera. That would all be happening by the 
computer--the printouts, et cetera.
    And the VA employees would get involved when an application 
goes in and the computer says, this doesn't match my logic. 
Perhaps the veteran has broken service and has two segments of 
service which have to be added up. Hopefully, we get the 
computer to be able to do that, too, but just as an example, 
say it couldn't do that. Then it would queue up on an Education 
Service employee's screen to say, this doesn't match the rule. 
Is it OK? At that point, the VA employee gets involved and 
either says yes, add the broken service, and approves it, or 
gets information back to the veteran and says, we need this 
additional information to explain it, et cetera.
    Senator Burr. And this is VA personnel, not contract 
personnel?
    Admiral Dunne. These are the same Education Service 
personnel who are out there today administering the other 
programs that are currently in effect. And we are in the 
process of training them so that they will be able to 
understand the criteria of the new bill, and then understand 
the rules-based engine that we have once it is built.
    Senator Burr. Mr. Chairman, if I could, and I appreciate 
the Members' indulgence here, if you took the greater 
Washington area and I said to you, how many different potential 
housing reimbursement numbers would exist in the greater 
Washington area, is that a number that you know? Does it have 
as many variations as I think it might, the way the bill was 
written?
    Admiral Dunne. I would start by counting zip codes, sir, 
and----
    Senator Burr. And every zip code could have a different 
housing reimbursement in the Washington area?
    Admiral Dunne. Potentially. Often, adjacent zip codes in 
some areas would have the same amount, but that would be a good 
place to start.
    Senator Burr. Mr. Chairman, my reason for pointing this out 
is we passed this piece of legislation and now we have asked VA 
to implement it. This is a very difficult piece of legislation 
to implement. And the fact is, I think VA has put a lot more 
time into how they do it--more importantly, how they do it 
correctly--than we give them credit for and that the VSOs give 
them credit for. The attempt here is to make sure that, in a 
timely fashion, individuals who qualify get the right amounts 
and that their intent to enroll actually is followed by a check 
that pays for their education.
    I think this is one that we have figured out up front how 
to do it, not necessarily waited until later on and figured out 
how to fix it, and it is refreshing to me. But I just want to 
stress to my colleagues, nothing will make this easier to 
implement if the reimbursement rates change, and they do 
annually around the country, depending upon the zip code that 
you live in. Without that computer software foundation, this 
becomes a manual process of trying to reassess what the changes 
are in that living allowance and it would become a nightmare 
down the road if, in fact, we did not make this attempt up 
front to get it right. So, I applaud you for this and I thank 
the Chair for his indulgence.
    Chairman Akaka. Thank you, Senator.
    We will now have questions from Senator Murray.
    Senator Murray. Thank you very much, Mr. Chairman, and I 
want to follow up on this, as well. We are hearing from a lot 
of veterans and VSOs about the outsourcing of the 
implementation. I guess I don't understand how the VA has been 
able to administer the G.I. Bill since its inception but 
suddenly doesn't have the ability to administer this new Post-
9/11 G.I. Bill. I think there are plenty of examples inside and 
outside of government of trying to implement systems that don't 
come in on time or don't come as promised, whether it is a 
private company or within the government. So, outsourcing can 
bring us problems, too.
    But I was reminded yesterday of a saying that says, you can 
delegate authority, but you can't delegate responsibility, and 
I think what a number of people are concerned about is that you 
are delegating both the authority and the responsibility with 
the contract that is out there, and I wanted to ask you how you 
plan on maintaining responsibility over the administration of 
the Post-9/11 G.I. Bill benefit under this new contract.
    Admiral Dunne. Well, Senator, I don't think that--I do not 
feel that responsibility for the program would go to the 
contractor. I feel that the responsibility would come back 
directly to me and the members of VBA who are responsible for 
it. We already have a management team in place of senior 
executives, all of whom, short of their own retirement, will be 
involved in this process right up through and beyond August 
2009, implementing it.
    We have been working this process since--well, before the 
bill was even signed and became law in anticipation, and we are 
involved in it every day, tracking the elements, not just the 
work of the contractor. We are working on the Yellow Ribbon 
Program and talking with the American Council of Education and 
other associations so that we can get the information out 
there. And as I mentioned before, we are deeply involved in 
getting the information out to the veterans so that they 
understand the program and can apply for it.
    Senator Murray. Specifically, do you have a contingency 
plan in place if the contractor fails to meet their obligations 
time-wise?
    Admiral Dunne. Senator, I am looking at three contingency 
plans right now, and I am actually scheduled to brief Secretary 
Peake on those this afternoon.
    Senator Murray. So, you are already looking at that. How 
long is this contract designed to last for?
    Admiral Dunne. The contract has a base period of 
performance of 3 years and two option years after that.
    Senator Murray. Can you define for us the benchmarks that 
you have within the contract that the contractor needs to meet?
    Admiral Dunne. I am trying to make sure I stay in the 
acquisition roles here. I think the best way to describe it is 
that there is a requirement in there for continuous 
improvement. Although it is IT software, the software we are 
procuring as a service and the anticipation would be--the 
requirement within the contract is that the contractor would 
continuously improve this. So, they have written software which 
we would use, but they are also able to be trying after we get 
started to make improvements, revisions as is commonly made 
with software to improve the efficiency or the effectiveness of 
it and then come to us and recommend changes to that over the 
course of the program, and the contract would be incentivized 
for them to do that.
    Senator Murray. OK. I think all of us are clearly on the 
same page. We want the G.I. Bill out there. We want the checks 
to start going. We want this to work seamlessly. We have all 
had enough experience to know that doesn't always happen, 
whether it is within your agency or contracted out. I think you 
will see this Committee following this very closely and I think 
there are a number of concerns. I hope that within the agency, 
you are really looking at this as you move forward.
    I just have a few seconds left. I did want to ask, you are 
going to be in place for a short amount of time. Can you define 
for this Committee perhaps what your top three specific changes 
you hope to implement in your tenure?
    Admiral Dunne. Top three. I would put the G.I. Bill, as we 
have just been talking about, right up there at the top because 
of its short timeframe. I intend to remain intimately involved 
in that and tracking that.
    Claims processing is another one of my concerns. We have a 
number of initiatives underway. As I mentioned, we are not 
waiting to be able to go completely electronic. We are looking 
at the business process itself. For instance, as an example, we 
are aware of the fact that both the National Cemetery 
Administration and VBA process a first notice of death from a 
veteran in various methods. We are working together with the 
other administration right now so that they will be able to do 
the majority of processing on that and their computer system 
will update ours automatically and that will keep the VSRs on 
our side from having to do that one element, so they can be 
working on claims instead. So, we are looking at business 
processes from that standpoint.
    Another element that is very important to me is we are 
about to commence on a review of the VR&E system. My intent is 
to get a program evaluation in place. We have been working that 
since the July timeframe, so that over the course of a year, we 
can do a complete evaluation of that program, because as I am 
sure you know, less than 10 percent of the eligible veterans 
actually participate in the VR&E program and we would like to 
understand why that participation level is so low and do 
whatever is necessary to increase that.
    Senator Murray. OK. Thank you very much. Thank you, Mr. 
Chairman.
    Chairman Akaka. Thank you very much, Senator Murray.
    Senator Tester?
    Senator Tester. Thank you, Mr. Chairman.
    Admiral Dunne, we visited previously about the backlog, 182 
days, I think currently, about that, give or take a few. In 
previous discussions you had talked about senior leadership 
forcing down on the bureaucracy ways to cut that time down. How 
do you see this playing out in transition now, and how can you 
get--just how is it playing out in the transition and go from 
there?
    Admiral Dunne. Senator, I guess the best way is that we 
continue to move along on making the changes that are necessary 
and just, you know, work as if there is no seam there in 
January. I am fortunate enough to have some very experienced 
senior executives in VBA who have been through transitions 
before and so they are accustomed to that.
    But we can't stop. I mean, we just keep right on marching. 
And as you know, as an example, we have put in teleconferencing 
capability with Fort Harrison and folks have been able to take 
advantage of that, and as recently as last month, we increased 
the number of hours per week up to 10 hours per week to make it 
available to more folks. As we become aware of those things, I 
don't want to save them for January. We are going to do them 
now and just keep marching.
    Senator Tester. There will be a new administration. There 
will be some turnover in senior management. We don't know how 
much at this point in time. I guess the question is are the 
folks underneath you as committed as you are, as least as I 
think you are, to cutting down the time for the disability 
claims?
    Admiral Dunne. One of the reasons I am anxious to take on 
this responsibility, sir, is because I have had the opportunity 
to work with the folks there and I understand their dedication 
to it. It is almost a competition amongst us to understand the 
numbers the best, and be able to understand not just 
production, but also accuracy. And taking a look at what we 
need to do to be as accurate as possible the first time around, 
because if we get it right the first time, we don't have to 
handle it again.
    Senator Tester. On the Guard and Reserves and the denial of 
claims, are you doing anything special in that regard? I think 
the disparity is 2-2\1/2\ times more likely that Guardsmen are 
denied benefits. I understand that it is kind of the nature of 
the beast; but have you come up with any ideas to help reduce 
the denials, complaints?
    Admiral Dunne. Sir, first off, we are continuing to track 
it and I am pleased to report to you that since we last talked 
in April, the numbers have actually closed in terms of we are 
now at 89 percent versus 96 percent, which is a 2-percentage 
point increase since the last time we talked. But we are still 
at the same level in terms of those factors that we see there, 
in terms of length of service and number of disabilities that 
are reported in the first place. But we continue to work very 
diligently to get the information from the Guard and Reserve as 
soon as possible.
    I think there are a couple of elements to that. First off, 
in the recent past, Secretary Peake hosted a meeting with 
General Blum and the Reserves and we talked very specifically 
about getting the information and getting the records. We now 
are opening up the benefits delivery at discharge program to 
everyone, not just at the 152 sites.
    We have also put in place what we are calling the Quick 
Start Program for those Guard and Reserve who oftentimes don't 
meet the 60- to 180-day criteria, and we said, still come to 
us. We will start working with you. We will take your record. 
We will get you all the information so that we can process 
those in the same time standards, hopefully, as the BDD claims.
    Senator Tester. Good. One last question for now. Among 
veterans who begin getting disability compensation in 2007, the 
dollar amount of compensation varied wildly. I think in New 
Mexico it was $12,000, compared to Minnesota, I think it was 
$5,500. Montana is somewhat lower, at about $6,700. Is this 
something that you are working on understanding--why this is 
occurring and is it something that something can be done about?
    Admiral Dunne. It is something that we are concerned about 
and that we are taking a look at through our STAR Program. One 
of the things they specifically are evaluating now is to expand 
their review for consistency and to determine why there might 
be a variation from one area to the other. And in fact, when it 
is discovered, actually drilling down and taking a look at the 
actual case and look at the parameters of the case to see why 
that difference exists, because what we need to do in the long 
run to get rid of it is to conduct the training that is 
necessary so that the people making the ratings understand the 
fine points of the disability system and can apply it the same 
way.
    Senator Tester. So, you do think it is a problem with the 
ratings initially being done in the States?
    Admiral Dunne. If there is variation, then we need to get 
rid of the variation, whether it is on a state-by-state basis 
or a zip code-by-zip code basis.
    Senator Tester. OK. All right. Sounds good. And then you 
are proceeding on that, because I think it is a bone of 
contention, so thank you. Thank you, Admiral.
    Chairman Akaka. Thank you very much, Senator Tester.
    Admiral, in your testimony, you identified improving 
communications with veterans as one of the Veterans Benefits 
Administration's top priorities. Can you elaborate on what 
specifically you are referring to and describe how VA has made 
progress in this area in the 6 months that you have served as 
Acting Under Secretary?
    Admiral Dunne. Mr. Chairman, I think I would provide two 
examples. The first is with the G.I. Bill in that we moved 
expeditiously to get information available to veterans both 
with press releases and our Web site and setting up within that 
Web site a capability for a veteran to sign up and say, please 
email me whenever you change any of the information on this 
page or any of the information is updated. We have also created 
a tri-fold handout which has the essence of the benefits on it 
and we make that readily available at a lot of the locations 
where we are, where veterans or active duty may be looking for 
information.
    The second example I would provide is in the loan guaranty 
area. We were very concerned about veterans needing or wanting 
to use their VA loan guaranty for mortgages in the current 
environment and we have made several press releases as well as 
updated our Web site to ensure that veterans understand that we 
are not a subprime entity. We are not a lender of last resort. 
If they are eligible, we want them to come see us. Recognizing 
the concern among veterans, we increased the number of people 
on our phone line to be able to answer more questions, not just 
from veterans who have VA loans already but from those who 
might have a loan which they want to try to replace with a VA-
guaranteed loan.
    Chairman Akaka. In your testimony before this Committee in 
July, you stated the Senior Oversight Committee was scheduled 
to meet on August 12 to discuss the future of the Single 
Disability Evaluation Pilot Program. Can you share with us the 
results of that meeting, including any plans for offering the 
next administration a template that can be followed in 
additional locations?
    Admiral Dunne. Yes, sir, Mr. Chairman. We did have that 
meeting and there has been a great deal of work within both DOD 
and VA since then. We have identified a number of sites, also 
15 specific VBA Regional Offices who would participate in the 
next phase. The first week in September, we had a 2-day 
conference where we sat down with the VA employees from those 
sites and they have gone through and created a checklist for 
each of their sites on the very specific things--whether it is 
IT or staffing or furniture or private meeting rooms, et 
cetera--that they need in order to make their site functional 
within this DES pilot. DOD is doing the same thing with their 
complementary bases, and I expect over the next few weeks that 
we will be merging that and then going back to the Senior 
Oversight Committee with a recommendation for a timeline for 
each of those areas.
    Chairman Akaka. The Joint VA/DOD Senior Oversight Committee 
has been successful in solving many of the problems which stem 
from Walter Reed. Because I believe there is much work to be 
done, I am concerned about how the work of the Senior Oversight 
Committee will be transitioned to the next administration. What 
is your view on how VA can sustain the Senior Oversight 
Committee's high level of focus and energy to solving these 
ongoing problems into the next administration?
    Admiral Dunne. Mr. Chairman, I agree that the Senior 
Oversight Committee is essential to continued progress, and 
accordingly, I am working very closely with Mr. Mike Dominguez, 
who is my counterpart on the OIPT that we run, and we have 
charged each of the lines of action with ensuring that the next 
Joint Strategic Plan that comes out by the end of the year 
contains all the action items from those lines of action so 
that they are written down, they are formal, they are part of a 
plan which will then be available to the next administration.
    In addition, within my Office of Policy and Planning, I 
have also added additional staff who are dedicated only to the 
VA/DOD relationship.
    Chairman Akaka. Thank you very much.
    Senator Burr?
    Senator Burr. Thank you, Mr. Chairman. I am sorry my 
colleagues left. I am going to go back to the G.I. Bill, 
because I want to try to sort of tie this together. Senator 
Murray started her inquiry of you by saying VA did the existing 
G.I. Bill. What is different and why can't they do the new G.I. 
Bill? Now, tell me where I am wrong.
    The G.I. Bill education benefit that has been in effect was 
one payment. That payment went to the veteran. That payment was 
for tuition and for housing. It was a pretty standard amount. 
Everybody got the same. So, it was fairly easy to target. If 
somebody qualified, here is the amount they get and they 
applied that wherever they went to school, and wherever they 
lived, they used the housing allowance for that.
    Under the new G.I. Bill, we have three separate payments. 
One payment goes for housing. One payment goes for tuition and 
fees. One payment goes for books and miscellaneous. It is 
likely that these payments go to different entities. Within 
each category, there are multiple different levels of payment 
that can be made. Within housing, it is determined based upon 
the zip code of where one might choose to go to school. Within 
the tuition and fees area, it is determined by the highest 
amount of a State institution in the State that they choose to 
go to school in.
    So, one can't just look at the choice that an individual 
makes. They have to look further at what the highest public 
tuition is to understand what the qualification amount would be 
that would be applied to that institution. And at some point 
after enrollment in the university, that veteran would access 
their books; and the courses they chose might determine whether 
that rates the maximum of $1,000 or was some figure less.
    So, I point this out for my colleagues. Before, we had one 
payment. That payment went to a veteran. That payment included 
tuition, fees, housing, which was the definition then. Now we 
have a program that has three distinct different payment areas: 
Housing with multiple different levels of reimbursement; 
tuition and fees with multiple different levels predicated by 
the State; and three, books. Have I pretty much gotten it----
    Admiral Dunne. Yes, sir, that covers it.
    Senator Burr. If this were a chart we had on the board, you 
would have one that had one big area and payment. The one over 
here would have so many lines and so many variables, you 
couldn't display it on a chart. So, I just want to say for the 
record, to suggest that because you could handle internally all 
the aspects of an education benefit in the VA today and that 
that should suggest that you should be able to do whatever, 
then one has to look at the construction that we have brought 
to this program and question just how difficult this is going 
to be.
    I just want to tell you, I applaud you because I think you 
understand the difficulty of it. You have tried to design and 
you have reached out to experts to design a system that won't 
eliminate 100 percent of the mistakes, but surely will allow us 
to take the easy pieces and to expedite that process and to 
make sure one thing happens--that veterans get their education 
benefit. The payment goes to the school; they show up on the 
day that they are supposed to sign up for classes and go to 
classes, their payment has been made. They have got their 
housing allowance so they have got the place they are going to 
live; and, hopefully, at some point the books that they buy at 
the bookstore are paid for and they are not getting delinquent 
sheets. I applaud you for what I think is well-thought-through 
in a very brief period of time for a very difficult piece of 
legislation.
    Admiral Dunne. Thank you.
    Chairman Akaka. Senator Burr, do you have any further 
questions?
    Senator Burr. No, sir.
    Chairman Akaka. Thank you, Senator Burr.
    Well, in closing, I want to thank you very much for being 
here and for having your family join you here. While there is 
little time left in the current administration, I do believe 
veterans and their families would be better served in this 
period with a Senate-confirmed Under Secretary leading the 
Veterans Benefits Administration. We would like to move the 
nomination as quickly as we can. With this in mind, I will work 
to bring your nomination before the Committee and the full 
Senate as soon as possible.
    Of course, we want to wish you well, and again, thank 
Secretary Mansfield for being here.
    This hearing is adjourned.
    [Whereupon, at 11:06 a.m., the Committee was adjourned.]
  

                                  
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