[House Prints 110-3]
[From the U.S. Government Publishing Office]



110th Congress 
 2d Session           HOUSE COMMITTEE PRINT NO. 3                      

_______________________________________________________________________
 
                                 REPORT

                                 to the

                        COMMITTEE ON THE BUDGET

                                from the

                     COMMITTEE ON VETERANS' AFFAIRS

                SUBMITTED PURSUANT TO SECTION 301 OF THE

                    CONGRESSIONAL BUDGET ACT OF 1974

                                 on the

                  BUDGET PROPOSED FOR FISCAL YEAR 2009

[GRAPHIC] [TIFF OMITTED] TONGRESS.#13


 February 28, 2008.--Printed for the use of the Committee on Veterans' 
                Affairs of the House of Representatives




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                     COMMITTEE ON VETERANS' AFFAIRS

                   BOB FILNER, California, Chairman 
CORRINE BROWN, Florida               STEVE BUYER, Indiana, Ranking
VIC SNYDER, Arkansas                 CLIFF STEARNS, Florida
MICHAEL H. MICHAUD, Maine            JERRY MORAN, Kansas
STEPHANIE HERSETH SANDLIN, South     HENRY E. BROWN, Jr., South 
    Dakota                               Carolina
HARRY E. MITCHELL, Arizona           JEFF MILLER, Florida
JOHN J. HALL, New York               JOHN BOOZMAN, Arkansas
PHIL HARE, Illinois                  GINNY BROWN-WAITE, Florida
MICHAEL F. DOYLE, Pennsylvania       MICHAEL R. TURNER, Ohio
SHELLEY BERKLEY, Nevada              BRIAN P. BILBRAY, California
JOHN T. SALAZAR, Colorado            DOUG LAMBORN, Colorado
CIRO D. RODRIGUEZ, Texas             GUS M. BILIRAKIS, Florida
JOE DONNELLY, Indiana                VERN BUCHANAN, Florida
JERRY McNERNEY, California           VACANT
ZACHARY T. SPACE, Ohio
TIMOTHY J. WALZ, Minnesota
                   Malcom A. Shorter, Staff Director
                     DEMOCRAT LETTER OF TRANSMITTAL

                                ------                                

                          House of Representatives,
                            Committee on Veterans' Affairs,
                                 Washington, DC, February 28, 2008.
Hon. John Spratt,
Chairman, Committee on the Budget,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: Pursuant to Sec. 301(d) of the 
Congressional Budget Act of 1974, and House Rule X, clause 
4(f), and Rule 7 of the Rules of the Committee on Veterans' 
Affairs, the Committee on Veterans' Affairs hereby submits its 
Views and Estimates with regard to programs and matters within 
the jurisdiction of the Committee to be set forth in the 
concurrent resolution on the budget for fiscal year 2009. The 
Minority will be submitting Additional and Dissenting Views 
under separate cover.
    Caring for our veterans is an ongoing cost of war, and a 
continuing cost of our national defense. As a Congress, and a 
nation, we must fulfill our obligations to the men and women 
who have served. We hope that you will carefully consider these 
Committee views and estimates. We have a lot of work ahead of 
us if we are to keep our promises to veterans. Working 
together, we can make sure that our veterans are not forgotten, 
and that we meet our obligations to them as a nation.
            Sincerely,
                    Bob Filner, Chairman; Corrine Brown, Vic Snyder, 
                            Michael H. Michaud, Stephanie Herseth 
                            Sandlin, Harry E. Mitchell, John J. Hall, 
                            Phil Hare, Michael F. Doyle, Shelley 
                            Berkley, John T. Salazar, Ciro D. 
                            Rodriguez, Joe Donnelly, Jerry McNerney, 
                            Zachary T. Space, Timothy J. Walz.
                     Committee on Veterans' Affairs

                     U.S. House of Representatives

                             110th Congress

                          Views and Estimates

                                FY 2009

                           February 28, 2008

                   SECTION 1--DISCRETIONARY ACCOUNTS

                     DEPARTMENT OF VETERANS AFFAIRS

    The Committee \1\ is recommending an overall level of $48.6 
billion for the discretionary accounts of the Department of 
Veterans Affairs (VA) for FY 2009. This recommendation is $5.5 
billion, or 12.7 percent, above the FY 2008 level of $43.1 
billion, and $3.8 billion, or 8.6 percent, above the 
Administration's FY 2009 request of $44.8 billion.
---------------------------------------------------------------------------
    \1\ While the Views and Estimates reflect a consensus effort, the 
Committee wishes to note that not all Members of the Committee 
necessarily agree with every aspect of the report. Accordingly, the 
Committee reserves its flexibility to determine program needs and 
recognizes the potential for funding changes as the Committee and 
Congress work their will through the legislative process.
---------------------------------------------------------------------------
    This recommended discretionary level includes an increase 
for VA medical care of $4.5 billion, or 12.3 percent, above FY 
2008, and $2.5 billion, or 6.5 percent, above the 
Administration's request. The Committee believes these 
additional resources are necessary if we are to provide 
sufficient funding for veterans' health care, restore many of 
the cuts proposed by the Administration, and keep our promises 
to our veterans.

                            VA Medical Care

    For VA medical care (the Medical Services, Medical 
Administration, and Medical Facilities accounts) the Committee 
is recommending $41.2 billion in appropriated dollars, $2.5 
billion above the Administration's FY 2009 budget request of 
$38.7 billion, and is a $4.5 billion, or 12.3 percent, increase 
over the FY 2008 levels. The Administration requests a 5.5 
percent increase over FY 2008 levels.
    Including total available resources (including medical 
collections), the Committee recommendation would provide $43.7 
billion for VA Medical Care. This recommended level in total 
medical care resources is $882 million above the amount 
recommended by the Independent Budget, co-authored by AMVETS, 
Disabled American Veterans, Paralyzed Veterans of America, and 
the Veterans of Foreign Wars.\2\ Including funding for the VA's 
Medical and Prosthetics Research account, the Committee is 
recommending a total for the Veterans Health Administration 
(VHA) $41.8 billion ($44.3 billion including collections), $4.6 
billion above the FY 2008 level and $2.6 billion above the 
Administration's FY 2009 request.
---------------------------------------------------------------------------
    \2\ In prior years, the Independent Budget recommendation did not 
include amounts attributable to medical collections. This year, the 
Independent Budget changed its methodology and included amounts 
attributable to medical collections in its FY 2008 Medical Services 
baseline and is recommending that these amounts be fully provided for 
in the Medical Services appropriation, in accordance with its long-
standing position that these amounts should be ``a supplement to, not a 
substitute for'' appropriated levels. In FY 2008, medical collections 
amounted to 6.2 percent of the amount available for VA medical care; in 
FY 2009, these collections are 6 percent of the VA's request. If the 
collection amounts estimated for FY 2009 are subtracted from the 
Independent Budget recommendation, the Independent Budget is requesting 
$40.3 billion for VA Medical Care, which compares to the Administration 
request of $38.7 billion ($1.6 billion above the Administration's 
request) and the Committee recommendation of $41.2 billion ($900 
million below the Committee's recommendation).
---------------------------------------------------------------------------
    The Committee recommendation would better enable the VA to 
provide quality health care in a timely fashion and to meet 
high-priority needs in the coming fiscal year. The recommended 
funding level would provide additional dollars to account for a 
higher level of inflation than estimated by the Administration 
to ensure the health care received by veterans tomorrow is not 
less than the care received today. The Committee recommends 
additional resources to account for a greater workload level 
and health care demand than estimated by the VA, including a 
greater-than-estimated number of veterans returning from Iraq 
and Afghanistan. The Committee provides additional resources 
for mental health care and services, long-term care, homeless 
programs, prosthetics, and Traumatic Brain Injury (TBI) care 
and treatment. The Committee recommendation restores proposed 
cuts to Non-Recurring Maintenance funding, funding that is 
essential if the VA is not to experience deteriorating medical 
facilities that impede the delivery of quality health care. The 
Committee also recommends providing funding to end the 
Administration's ban on enrollment of Priority 8 veterans 
(veterans with incomes above the geographically adjusted 
Housing and Urban Development threshold for low-income 
housing--$28,430 in some communities--and who do not have 
compensable service-connected conditions) first instituted by 
the Administration in January 2003.
    As Congress contemplates further spending on the war in 
Iraq through the supplemental funding process, the Committee 
plans to seek opportunities to add additional resources for 
veterans' programs--for we should not forget the warrior as we 
fund the war.

         Medical Care--Total Resources (Including Collections)

----------------------------------------------------------------------------------------------------------------
                                                          Independent           FY 2009         Recommendation
        FY 2008  Enacted           FY 2009  Request         Budget          Recommendation        vs. Request
----------------------------------------------------------------------------------------------------------------
39,135,220,000..................     41,203,363,000      42,821,903,000      43,703,870,000       2,500,507,000
----------------------------------------------------------------------------------------------------------------

    The Committee, as it has every year they have been 
proposed, emphatically rejects the Administration's proposal to 
institute enrollment fees and increase co-payments for certain 
veterans. The Administration estimates that instituting an 
enrollment fee and increasing pharmaceutical co-payments would 
result in $2.3 billion (over 5 years) and $5.2 billion (over 10 
years) in mandatory receipts. The Administration proposes that 
these dollars be considered ``mandatory'' as compared to 
``discretionary dollars'' and would direct that they be 
deposited in the Treasury instead of being retained by the VA. 
According to the VA, as many as 444,000 veterans next fiscal 
year would choose not to be enrolled in the VA and 146,000 
individual veterans would not seek VA health care if the 
Administration's fee and co-payment proposals were accepted by 
Congress. The Committee remains puzzled as to why the 
Administration requests these proposals annually in the face of 
consistent Congressional opposition, and is concerned about the 
effect these proposals have, especially in terms of workload 
and resource estimates, on VA budget estimates and planning for 
future years.

               Medical Care--Total Resources (by Account)


--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                  Independent        FY 2009 HVAC       Recommendation
                                                       FY 2008  Enacted    FY 2009  Request         Budget          Recommendation        vs. Request
--------------------------------------------------------------------------------------------------------------------------------------------------------
Medical Services....................................     29,104,220,000      29,465,503,000      32,153,138,000      31,656,100,000      +2,190,597,000
Medical Administration..............................      3,517,000,000       4,610,000,000       3,625,762,000       4,610,000,000                   0
Medical Facilities..................................      4,100,000,000       4,661,000,000       4,576,143,000       4,971,000,000        +310,000,000
Total, Medical Care.................................     36,721,220,000      38,736,503,000      40,355,043,000      41,237,100,000      +2,500,597,000
MCCF Collections....................................      2,414,000,000       2,466,860,000       2,466,860,000       2,466,860,000                   0
                                                     ---------------------------------------------------------------------------------------------------
Total, Medical Care
  (with Collections)................................     39,135,220,000      41,203,363,000      42,821,903,000      43,703,960,000      +2,500,597,000
--------------------------------------------------------------------------------------------------------------------------------------------------------

    * Important Notes:
     For comparison purposes, and unless otherwise 
noted, amounts attributable to medical collections have been 
subtracted from the Independent Budget's Medical Services 
recommendation (and, when appropriate, are displayed on the 
MCCF Collections line). Medical collections are not included in 
the discretionary estimates relied upon by the Committee on the 
Budget. In a departure from previous recommendations, the 
Independent Budget has included collections in its baseline for 
Medical Services for FY 2008 and is advocating that these 
amounts be fully appropriated in the Medical Services account 
for FY 2009. Therefore, the Independent Budget is recommending 
$34.6 billion in Medical Services to account for this. The 
Independent Budget has not provided clear recommendations 
regarding how Congress and the Administration are to treat the 
$2.5 billion, or 6 percent of the VA health care budget, 
received in collections. The Administration's request, and the 
Committee recommendation, does not include appropriating 
medical collections in the Medical Services account.
     The Administration's FY 2009 budget submission 
proposed abolishing the Medical Administration account and 
including these activities in the Medical Services account. 
Under this structure, the VA is requesting $34.1 billion for 
the Medical Services account. The Views and Estimates displays 
the VA's request in the traditional three-account structure and 
amounts attributable to the Medical Administration account have 
been subtracted from the Medical Services account and restored 
to the Medical Administration account.

                            Medical Services

----------------------------------------------------------------------------------------------------------------
                                                          Independent           FY 2009       Recommendation vs.
        FY 2008  Enacted           FY 2009  Request         Budget          Recommendation          Request
----------------------------------------------------------------------------------------------------------------
29,104,220,000..................     29,465,503,000      32,153,138,000      31,656,100,000      +2,190,597,000
----------------------------------------------------------------------------------------------------------------

Description \3\
---------------------------------------------------------------------------
    \3\ Unless otherwise noted, account desriptions are from H. Rept. 
110-186.
---------------------------------------------------------------------------
    This appropriation provides for medical services of 
eligible veterans and beneficiaries in Department medical 
centers, outpatient clinic facilities, contract hospitals, 
State homes, and outpatient programs on a fee basis. Hospital 
and outpatient care is also provided by the private sector for 
certain dependents and survivors of veterans under the civilian 
health and medical programs for the Department of Veterans 
Affairs.
Recommendation
    For FY 2009, the Administration has requested $29.5 billion 
for the Medical Services account, an increase of $400 million 
above the FY 2008 level of $29.1 billion. The Committee 
recommends $31.7 billion, $2.6 billion above FY 2008 levels and 
$2.2 billion above the Administration's request.
    The Committee recommendation would:
     Provide additional resources for medical 
inflation--$166 million;
     Provide for additional workload, including 
increased number of OEF/OIF veterans--$613 million;
     Provide additional funding for mental health--$223 
million;
     Provide additional funding for long-term care--
$332 million;
     Provide additional amounts for homeless veterans 
by matching the authorization level for the Grant and Per Diem 
program--$8 million;
     Provide for an additional 5 percent increase for 
the VA's Prosthetics program--$66 million;
     Provide additional resources for TBI care and 
treatment--$32 million;
     Provide funding to end the Administration's ban on 
enrollment of Priority 8 veterans--$750 million.
    Inflation: The VA is estimating an overall medical 
inflation rate of 4.63 percent. According to the Bureau of 
Labor Statistics, ``[f]or the 12 months ended in December, the 
medical care index rose 5.2 percent, its largest annual advance 
since a 5.4 percent increase in 1993.'' (Bureau of Labor 
Statistics, Consumer Price Index: December 2007, released 
January 16, 2008). Although as with any forward-looking 
estimate the future remains uncertain, the Committee believes 
that it is more likely than not that medical inflation will be 
closer to the level experienced in 2007 than the amount 
estimated by the VA. The Committee, therefore, recommends that 
an additional $166 million be provided to match the estimated 
rate of medical inflation in FY 2009.
    Workload: The Committee is concerned that the 
Administration may have, once again, underestimated the total 
number of unique patients it expects to see in FY 2009. From FY 
2003 through FY 2008, the VA saw an average annual increase in 
unique patients of 2.7 percent and from FY 2002 through FY 2008 
the VA saw a 3.3 percent average annual increase. For FY 2009, 
the VA estimates a 1.6 percent increase, including an increase 
of only 2,621 Priority 7 and 8 veterans. As part of this 1.6 
percent increase, the VA expects it will see 333,275 OEF/OIF 
veterans, an increase of 39,930 from the FY 2008 current 
estimate. The VA is now estimating it will see 293,345 OEF/OIF 
veterans in 2008, an increase of 87,717 over FY 2007 while 
initially estimating last year that this increase would only 
amount to 57,717. The Committee recommends $613 million in 
additional funding to provide for an increased number of OEF/
OIF veterans that more closely matches the VA's recent 
experiences and ongoing combat activities in Iraq and 
Afghanistan, as well as to provide a modest increase in overall 
unique patients that more closely tracks the VA's average 
annual workload increases.
    Mental Health: For FY 2009, the VA has requested a 9 
percent increase in mental health care spending. With the VA 
facing an ever-growing demand for mental health services, 
especially from veterans returning from Iraq and Afghanistan, 
the Committee is recommending a 15 percent increase for FY 
2009, or $212 million in additional resources. The Committee 
recommendation also provides funding for an additional 15 Vet 
Centers, bringing the total for FY 2009 up to 247. The VA 
estimates 232 for FY 2009, which matches the current estimate 
for FY 2008 and is 23 more than the number in FY 2007.
    Long-Term Care: The Committee recommends an additional $332 
million for VA's Long-Term Care program. The Administration is 
in violation of its statutory responsibility to maintain FY 
1998 levels for the Average Daily Census (ADC) for VA nursing 
home care, as mandated by P.L. 106-117, the Veterans Millennium 
Health Care and Benefits Act. The VA's FY 2009 budget 
submission requests resources to support an estimated 11,000 
ADC, an amount 2,391 below the 1998 figure, and equal to its FY 
2008 budget request. The Committee recommends additional long-
term care funding for the VA to begin to meet its statutory 
obligations. In addition, the Committee recommends additional 
funding for non-institutional and community-based services, 
especially those programs targeting the unique needs of younger 
wounded veterans returning from Iraq and Afghanistan who need 
long-term care services.
    Homeless Veterans: The Committee recommends an additional 
$8 million to bring the VA's Grant and Per Diem program up to 
the levels authorized in the 109th Congress. Although Congress 
has authorized this program at a level of $130 million, the VA 
is requesting $122 million. The Committee plans to explore 
changes to the Grant and Per Diem program where appropriate in 
order to begin to effectively address the tragedy of homeless 
veterans.
    Prosthetics: The Committee recommends providing an 
additional 5 percent increase for the VA's Prosthetics program. 
This will assist the VA in meeting the needs of a new 
generation of wounded veterans needing technologically advanced 
prosthetics, while not forgetting the needs of our older 
veterans.
    TBI Care and Treatment: VA's budget estimate regarding 
spending for TBI states that data used to make these estimates 
are preliminary and ``based on stable growth patterns with 
small increases thru 2009 and beyond.'' (FY 2009 VA Budget 
Submission, Volume 2, 1H-18). The Committee understands that 
insufficient data may not provide an accurate or realistic 
picture of the needs of veterans with TBI, from mild to more 
severe cases. TBI is often called the signature wound of the 
current conflict, and the Committee believes the VA must be in 
the forefront of providing health care to our veterans with 
TBI. The Committee recommends an additional $32 million for TBI 
care and treatment, a 15 percent increase above FY 2009 
estimated levels. Additionally, the Committee believes that VA 
should look at innovative programs, such as increasing the 
number of patient or bedside advocates to help ensure that our 
seriously wounded veterans receive the health care and services 
they need, as well as rapidly meeting its responsibilities 
under title XVII of the FY 2008 National Defense Authorization 
Act (P.L. 110-181).
    Women Veterans: Although the Committee is pleased that the 
VA has requested an additional $14 million over FY 2008 levels 
for the Women Veterans Outreach Program, the Committee believes 
that the VA must ensure that women veterans get the care and 
treatment they have earned. Additional resources may well be 
necessary in order to meet the needs of an ever-increasing 
cohort of women veterans.
    VA/DoD Health Care Sharing Incentive Fund: The VA has 
transferred $15 million to this cooperative effort in FY 2008, 
but plans to provide no funding in FY 2009. In FY 2007, $35 
million was transferred. The Committee believes it is essential 
that the VA find the needed resources to continue this 
important endeavor.
    The Committee urges the VA to work closely with the DoD to 
institute and operate an innovative program to address the 
needs of returning servicemembers, especially regarding mental 
health care, and their families. We believe that an approach 
involving servicemembers and their families receiving 
information on benefits, necessary training and support, as 
well as specific services in a joint and comprehensive manner 
at the point of discharge or immediately prior to discharge 
offers a unique manner in which the VA and DoD can address the 
needs of veterans returning from Iraq and Afghanistan who are 
beginning the process of integrating back into civilian life.
    Ending Enrollment Ban on Priority 8 Veterans: The Committee 
recommendation includes $750 million to meet the costs 
associated with ending the Administration's enrollment ban on 
Priority 8 veterans. The Committee requested a detailed report 
from the VA regarding the costs the VA believes it would incur 
if the enrollment ban was lifted. This report was promised to 
the Committee by January 1, 2008. The Committee finally 
received a copy on February 26, 2008.
    The Committee is disappointed at the level of detail 
provided by the VA. The report provides no specific information 
regarding how the VA ended up estimating that it would 
``require $3.1 billion dollars to provide health care services 
to the additional 1.4 million enrollees and approximately 
750,000 patients during the first year of implementation,'' nor 
does it include detailed information regarding facility 
requirements and staffing levels. The VA believes that 2013 
would be the first year it would be able to allow enrollment of 
new Priority 8 veterans by putting into place ``needed 
infrastructure to accommodate increases in demand'' and 
questions its ability to meet staffing requirements by this 
time.
    The VA argues that ``[a]ccounting for the increased growth 
expected under the current enrollment policy and reopening 
enrollment in 2013 to new Priority 8 veterans will result in a 
total growth in enrollees of 22 percent and a total growth in 
users of 21 percent.'' According to the VA, growth under the 
current policy of banning enrollment of new Priority 8 veterans 
would result in an increase of 4 percent (enrollees) and 6 
percent (patients).
    The Independent Budget bases its estimate as to net cost 
($600 million) to lift the enrollment ban on a projection of 
1.9 million new users and a utilization rate of 20 percent. The 
VA's estimate is based on 1.4 million enrollees and a 
utilization rate of 54 percent. The Committee is concerned that 
the VA's estimates are filled with apparent contradictions. The 
VA argues that lifting the enrollment ban is not necessary 
since ``almost 91 percent of Priority 8 enrollees report having 
some form of health insurance coverage other than VA.'' At a 
hearing on Priority 8 veterans held last year, a witness 
testified that as many as 2 million veterans may be without 
health insurance and not have access to VA care. The VA also 
argues that new enrollees would mainly utilize ``ambulatory, 
diagnostic and pharmacy services.'' The VA states that 
``[a]pproximately 75 percent of current enrollees report that 
they do not intend to use VA as their primary source of health 
care in the future.'' The VA then bases its cost estimate 
assuming a utilization rate of 54 percent for new enrollees, a 
figure that seems unduly high considering VA's statements 
regarding reliance and utilization.
    The Committee would like to see more specific details 
regarding its estimates as to costs over the first year ($3.1 
billion), 5-year period ($16.9 billion), and ten-year period 
($39.3 billion). The Committee does not put great faith in 
these estimates. For example, the 5-year cost of $16.9 billion 
seems to provide for slightly more than an annual increase 
based upon its first year estimate, even though the VA states 
elsewhere in its report that ``once enrollment in Priority 8 is 
reopened, VA expects a significant surge in the first year'' 
which would seem to necessitate a higher first-year cost and 
lower costs for future years.
    The Committee wants to ensure that the VA has the resources 
it needs to lift the ban and ensure that veterans currently in 
the system do not see a diminution of service or access. The 
Committee believes that $750 million in additional funding is 
sufficient to meet the increased demand for services that would 
occur once the enrollment ban is lifted, but retains its 
flexibility to recommend additional resources if it is 
convinced that additional resources are needed. The Committee 
agrees with VA that it would face an increased demand for 
additional infrastructure when the enrollment ban is lifted, 
not only to care for new Priority 8 veterans, but all veterans 
seeking access, and has recommended substantial increases in 
both Major and Minor construction accounts in part to address 
these concerns. With a faltering economy, it is even more 
essential that we re-open access to VA health care to all 
veterans.

                         Medical Administration


----------------------------------------------------------------------------------------------------------------
                                                          Independent           FY 2009       Recommendation vs.
        FY 2008  Enacted           FY 2009  Request         Budget          Recommendation          Request
----------------------------------------------------------------------------------------------------------------
3,517,000,000...................      4,610,000,000       3,625,762,000       4,610,000,000                   0
----------------------------------------------------------------------------------------------------------------

Description

    The Medical Administration appropriation provides funds for 
the expenses of management and administration of the 
Department's health care system. Included under this heading 
are provisions for costs associated with operation of 
department medical centers, other facilities, and VHA 
headquarters, plus the costs of VISN offices and facility 
director offices, chief of staff operations, quality of care 
oversight, legal services, billing and coding activities, 
procurement, financial management, and human resources 
management.

Recommendation

    For FY 2009, the Administration has requested $4.6 billion 
for the Medical Administration account, an increase of $1.1 
billion, or 31 percent, above the amount provided in FY 2008.
    The Committee recommends that the Administration's 
requested funding level be provided. The Committee notes the 
large requested increase for Medical Administration, and hopes 
that by providing this level of funding it will assist the VA 
in maintaining the quality of its health care system and 
responding to problems when they arise.

                           Medical Facilities


----------------------------------------------------------------------------------------------------------------
                                                          Independent           FY 2009       Recommendation vs.
        FY 2008  Enacted           FY 2009  Request         Budget          Recommendation          Request
----------------------------------------------------------------------------------------------------------------
4,100,000,000...................      4,661,000,000       4,576,143,000       4,971,000,000         310,000,000
----------------------------------------------------------------------------------------------------------------

Description

    The Medical Facilities appropriation provides funds for the 
operation and maintenance of the Department's health care 
system's capital infrastructure. Included under this heading 
are provisions for costs associated with utilities, 
engineering, capital planning, leases, laundry, groundskeeping, 
garbage, housekeeping, facility repair, and property 
disposition and acquisition.

Recommendation

    For FY 2009, the Administration has requested $4.7 billion 
for the Medical Facilities account, an increase of $561 million 
above the FY 2008 level. The Committee recommends $5 billion 
for this account, an increase of $310 million above the 
Administration's request and $871 million above the FY 2008 
level.
    The Administration has proposed cutting funding for Non-
Recurring Maintenance by $300 million below the FY 2008 current 
estimate and $15 million below the level provided in FY 2007. 
The Committee recommendation restores this proposed cut. It is 
vital that resources be made available to meet the maintenance 
needs of VA medical facilities. The Committee recommendation 
also proposes increases for Community-Based Outpatient Clinics 
(CBOCs) and for facility activations in order for the VA to 
provide greater access to medical services for veterans, 
especially those residing in rural and under-served areas.
    The Administration's FY 2009 budget request states that the 
VA plans to open 51 CBOCs in FY 2009, and is estimating that it 
will open 64 new CBOCs in FY 2008. The Committee desires the VA 
to move forcefully to open needed CBOCs in Maine (Dover-
Foxcroft), Wisconsin (Green Bay), Illinois (Moline and Madison 
County), and Florida (Gainesville).
    The Committee recommendation would:
     Restore proposed cuts to Non-Recurring 
Maintenance--$300 million;
     Increase resources for CBOCs by 50 percent--$5 
million;
     Increase funding for facility activations by 50 
percent--$5 million.

                    Medical and Prosthetic Research


----------------------------------------------------------------------------------------------------------------
                                                          Independent           FY 2009       Recommendation vs.
        FY 2008  Enacted           FY 2009  Request         Budget          Recommendation          Request
----------------------------------------------------------------------------------------------------------------
480,000,000.....................        442,000,000         555,000,000         555,000,000        +113,000,000
----------------------------------------------------------------------------------------------------------------

Description

    This account includes medical, rehabilitative and health 
services research. Medical research is an important aspect of 
the Department's programs, providing complete medical and 
hospital services for veterans. The prosthetic research program 
is also essential in the development and testing of prosthetic, 
orthopedic and sensory aids for the purpose of improving the 
care and rehabilitation of eligible disabled veterans, 
including amputees, paraplegics and the blind. The health 
service research program provides unique opportunities to 
improve the effectiveness and efficiency of the health care 
delivery system. In addition, budgetary resources from a number 
of areas including appropriations from the medical care 
accounts; reimbursements from the Department of Defense; and 
grants from the National Institutes of Health, private 
proprietary sources, and voluntary agencies provide support for 
the Department's researchers.

Recommendation

    For FY 2009, the Administration has requested $442 million 
for the VA Medical and Prosthetic Research account, $38 million 
below the FY 2008 level. The Committee recommendation of $555 
million for Medical and Prosthetic Research is $75 million 
above the FY 2008 level and $113 million above the 
Administration's request.
    The Committee recommends $38 million to restore the 
Administration's proposed cut in this account. Especially 
troubling to the Committee are proposed cuts in eight of the 21 
Designated Research Areas, including cuts in research on mental 
illness, acute and traumatic injury, central nervous system and 
associated disorders, diabetes, special populations, and 
military occupation and environmental exposures.
    The Committee recommends $17 million to account for the 
effects of biomedical inflation on VA research. The Biomedical 
Research and Development Price Index, developed by the 
Department of Commerce's Bureau of Economic Analysis for use by 
the National Institutes for Health (NIH) and updated on 
February 4, 2008, estimates that a 3.5 percent increase is 
needed to compensate for increases due to inflation and to 
maintain research purchasing power.
    The Committee is concerned that VA estimates are unduly 
optimistic regarding expected revenues from other Federal 
sources, especially in light of the Administration's proposed 
flat-lined budget for the NIH. The VA estimates it received 
$668 million in Federal resources in 2007. Last year, in its FY 
2008 budget submission, the VA estimated it would receive $769 
million in FY 2008; it now estimates it will receive $708 
million. For FY 2009, the VA estimates that it will receive 
$751 million, an increase of $43 million. The Committee doubts 
that the VA will meet its estimate of $751 million in Federal 
resources and believes that an increased appropriation is 
essential if the VA research program is to meet the challenges 
it faces.
    The Committee recommendation provides $58 million for 
additional research projects, especially those concentrating on 
the unique needs of veterans returning from Iraq and 
Afghanistan. This increase would also ameliorate any possible 
effects of a shortfall in other Federal resources. In addition, 
the Committee believes that caps on investigator-initiated 
awards should be increased from the current $125,000 annually 
to the previous level of $150,000, in accordance with 
recommendations made by the Friends of VA Medical Care and 
Health Research (FOVA) and the Independent Budget.
    The Committee recommendation would:
     Restore proposed FY 2009 cuts--$38 million;
     Provide for a 3.5 percent increase for estimated 
biomedical inflation--$17 million;
     Increase overall funding for research projects, 
particularly those addressing needs of servicemembers returning 
from Iraq and Afghanistan--$58 million.

                       General Operating Expenses


----------------------------------------------------------------------------------------------------------------
                                                          Independent           FY 2009       Recommendation vs.
        FY 2008  Enacted           FY 2009  Request         Budget          Recommendation          Request
----------------------------------------------------------------------------------------------------------------
1,605,000,000...................      1,699,867,000       1,985,602,000       1,896,126,000        +196,259,000
----------------------------------------------------------------------------------------------------------------

Description

    The General Operating Expenses appropriation provides for 
the administration of non-medical veterans' benefits through 
the Veterans Benefits Administration and departmental 
management and support.
    The General Operating Expenses account funds activities of 
the Veterans Benefits Administration and General 
Administration.

                    VETERANS BENEFITS ADMINISTRATION

    VBA consists of five programs: Disability Compensation, 
Pensions and Burial; Education; Housing; Vocational 
Rehabilitation and Employment; and, Insurance.

Compensation and Pension Service

    VA provides service-connected compensation to veterans with 
disabilities incurred or aggravated during military service, 
dependency and indemnity compensation (DIC) to surviving 
spouses, children and low-income dependent parents of veterans, 
pension benefits to elderly and disabled low-income wartime 
veterans, death pension to the surviving spouses and children 
of wartime veterans and benefits to certain children of 
veterans who were disabled by spina bifida or other congenital 
conditions related to their parent's military service.

Education Service

    VA provides education assistance to servicemembers, 
veterans, and certain eligible survivors and dependents in 
exchange for military service. VA education assistance, 
popularly known as the Montgomery GI Bill, is used by the Armed 
Forces as a recruiting and retention tool, as well as a 
readjustment benefit for servicemembers seeking to achieve 
educational and vocational goals in the civilian workforce.

Housing (Loan Guaranty Service)

    VA assists veterans and servicemembers to purchase and 
retain homes in recognition of their service to the Nation. 
VA's partial guarantee on loans made by private lenders enables 
veterans and servicemembers to purchase homes with little or no 
down payment, thereby making home ownership affordable to many 
veterans.

Vocational Rehabilitation and Employment (VR&E)

    VR&E provides employment services and assistance to enable 
veterans with service-connected disabilities to obtain suitable 
employment and, to the maximum extent possible, achieve 
independence in daily living.

Insurance

    The Insurance Program provides servicemembers and their 
families with universally available life insurance, as well as 
traumatic injury protection insurance. It also provides for the 
conversion to a renewable term insurance policy after a 
servicemember's separation from service and provides life 
insurance to veterans who have lost the ability to purchase 
commercial insurance at standard (healthy) rates due to lost or 
impaired insurability resulting from military service.

                         GENERAL ADMINISTRATION

    General Administration funds the Office of the Secretary, 
six Assistant Secretaries, the Board of Veterans' Appeals, the 
Office of the General Counsel, and the Office of Construction 
and Facilities Management.

Recommendation

    For FY 2009, the Administration is requesting $1.7 billion 
for the General Operating Expenses (GOE) account, an increase 
of $95 million, or 5.9 percent, above the $1.6 billion provided 
in FY 2008. This request includes $1.4 billion for VBA, an 
increase of $44.8 million over the FY 2008 level, and $328 
million for General Administration, an increase of $50.1 
million over FY 2008.
    The Committee is recommending $1.9 billion, an increase of 
$291 million above FY 2008 and $196 million above the 
Administration's request.
    The Committee recommendation would:
     Provide an additional 1,500 FTE for the 
Compensation, Burial, and Pension program to better address the 
claims backlog and other deficiencies--$117 million
     Provide an additional 130 FTE for the Education 
program--$10 million
     Provide an additional 150 FTE for the Vocational 
Rehabilitation and Counseling Program--$14 million
     Double the amount provided for the Compensation, 
Burial and Pension training program--$6 million
     Provide resources to explore innovative pilot 
programs and other solutions to address the claims backlog--$50 
million
    Claims Backlog: As of February 16, 2008, the inventory of 
compensation and pension claims pending at the VA was 663,319, 
an increase of 5,351 from the previous week and 36,890 above 
the 626,429 pending this time last year. (VA Monday Morning 
Workload Report, February 16, 2008).
    The Committee is concerned that VA is not moving swiftly 
enough to hire the additional 3,100 FTE provided so far by the 
110th Congress. On July 31, 2007, VA submitted a ``White Paper 
on the VA Disability Claims Processing Workforce'' to the 
Committees on Appropriation. The report listed a total of 3,100 
new hires funded through the FY 2007 appropriation (400), the 
FY 2007 supplemental (800), and the FY 2008 House 
Appropriations recommended level (1,900). The VA projected an 
end-of-year staffing level for Compensation and Pension of 
9,068 FTE (direct) and 10,998 FTE (direct) for FY 2008.
    The VA's FY 2009 budget submission provides a 2007 level of 
8,353 FTE (direct) and estimates an FY 2008 level of 10,304 FTE 
(direct). The VA's estimate for 2009 is 10,998 FTE (direct), 
the same level it projected in July for the end of 2008. The 
VA's budget request for FY 2009 estimates an additional 694 
direct FTE (for a total of 10,998) over the FY 2008 current 
level (10,304). Therefore, the VA is estimating the same FTE 
levels for FY 2009 as projected for the end of FY 2008 in its 
July 2007 White Paper.
    Although the Committee's recommendation includes a 
substantial increase in FTE above the Administration's request, 
the Committee believes that merely adding FTE is not the sole 
answer to addressing the claims backlog issue. We believe the 
VA must vigorously explore alternative methods of addressing 
once and for all this intolerable backlog.
    The Veterans' Disability Benefits Commission noted that in 
2006, two-thirds of compensation claims were from veterans 
previously determined to have a service-connected disability 
and that most of these veterans were from previous conflicts. 
The average age of veterans filing claims is 55. As the number 
of claims increases, the ability of the VBA to process these 
claims in a timely fashion under the current system is 
increasingly called into question. The Committee is concerned 
that since 2002, and the inception of the Claims Improvement 
Processing Model, the VBA has failed to meet its major 
strategic goals in the Compensation and Pension program. In 
addition to more rigorous training, addressed by the Committee 
in its recommendation, there simply must be greater 
accountability for failure to meet strategic goals.
    In fact, according to the VA's FY 2007 Performance and 
Accountability Report, released on November 15, 2007, the VBA 
missed the vast majority of its compensation and pension 
rating-related and non-rating-related performance targets. The 
Committee believes there must be a closer coordination between 
performance goals and the VA's actual experience; for goals 
that are never met are useless in measuring any real progress 
or increasing accountability.
    The Systematic Technical Accuracy Review (STAR) is the 
VBA's system-wide program for measuring compensation and 
pension claims processing accuracy. The Committee believes VBA 
should significantly increase the level of FTE devoted to STAR 
in order to increase accountability, reduce avoidable errors, 
and ensure more uniform decisions between Regional Office 
ratings.
    The Committee recommends an additional $5.5 million for 
training expenses, doubling the amount proposed by the 
Administration. Training is essential for all employees, 
especially new hires, in order to make sure claims are 
processed speedily and correctly. The Committee also believes 
that VBA should reinstitute administration of the skills 
certification test with sustained input on development from all 
interested parties.
    The Committee is also concerned that tools already provided 
to the VA are not being utilized fully. The VA has testified 
before the Subcommittee on Disability Assistance and Memorial 
Affairs that it is not fully utilizing the pre-stabilization 
rate mechanism as outlined in regulations. We believe the VA 
must fully utilize this tool in addressing the claims of 
returning servicemembers.
    The Committee believes there must be a greater attempt by 
the VA to embrace possible technological improvements to its 
current practices, including innovative information technology 
and artificial intelligence applications that offer the hope of 
reducing the average time for a claims decision to be made. The 
Committee also strongly recommends that the VA take the 
necessary steps to reduce the amount of paper involved in the 
process as it moves toward the goal of a ``paperless'' claims 
process. The Committee awaits the final report from IBM, which 
VA contracted with, to evaluate its business lines and provide 
long-range strategies.
    Although more properly under the Information Technology 
Systems account, the Committee wishes to note that the 
Administration's IT request includes funding for the Virtual VA 
program, but this is only to scan in VBA's paper records. While 
this is an essential task, it does little to create a true 
electronic claims processing system that would benefit veterans 
by applying technological solutions to the impediments faced by 
processes that are rooted in the previous century. The 
Committee recommends that VA reassess its plan and maximize 
available information technologies and artificial intelligence 
applications to modernize its claims processing system.
    The Committee believes VA must embrace radical ideas to 
solve the claims backlog issue and is recommending that $50 
million be provided to explore various pilot programs and 
initiatives that could revolutionize the process by which 
veterans receive the benefits they have earned. The Committee 
believes that one such initiative could include the creation of 
a Veterans Advocates Training Institute to provide consistent 
and improved training of State service officers and others who 
assist veterans in filing claims.
    Burial Claims: The Committee notes that the 
Administration's FY 2009 request assumes a decrease in FTE for 
burial claims of 17 below the FY 2008 current estimate, and 50 
below the FY 2008 budget estimate. The FY 2009 estimate is also 
25 FTE below the FY 2007 level. As the number of interments is 
expected to increase, and VA has missed many of its performance 
and accountability targets, the Committee believes that 
additional FTE should be detailed to this activity.
    Vocational Rehabilitation and Employment: The Committee is 
concerned that VR&E counselors are overloaded and are managing 
an excessively large case load. Currently, each counselor has a 
case load of 130 cases where minimal contact is made with the 
veteran. While the VA maintains that this is a proper level of 
cases for providing services, the Committee is not convinced 
that such a caseload leads to the optimum level of service to 
veterans and is recommending an additional 150 FTE to properly 
staff the division and provide adequate services to veterans.
    Education: The Committee is recommending an additional 130 
FTE to handle education claims. With the enactment of the 
National Defense Authorization Act for FY 2008 (P.L. 110-181), 
which included the addition of portability of Chapter 1607 
benefits, the Committee anticipates an increase in workload and 
recommends an additional 80 FTE to meet this expected increase. 
The Education program also recently started a call center in 
Muskogee, Oklahoma, and has pulled 50 FTE from other areas to 
staff this call center. These 50 FTE have not been replaced and 
the Education program would benefit from maintaining a stable 
level of personnel. The Committee believes the VA should also 
explore ways to increase outreach to improve participation of 
returning servicemembers and veterans in pursuing opportunities 
to achieve college educations with their respective benefits.

                     Information Technology Systems


----------------------------------------------------------------------------------------------------------------
                                                                                FY 2009       Recommendation vs.
         FY 2008 Enacted            FY 2009 Request   Independent Budget    Recommendation          Request
----------------------------------------------------------------------------------------------------------------
1,966,465,000...................      2,442,066,000       2,164,938,000       2,442,066,000                   0
----------------------------------------------------------------------------------------------------------------

Description

    The Information Technology Systems account was established 
in the FY 2006 VA Appropriations bill, P.L. 109-114. The 
account previously encompassed the entire non-pay information 
technology portfolio for the Department of Veterans Affairs, 
including all automation efforts in all administrations. 
Starting in fiscal year 2007, and reflected for the first time 
in the budget request for fiscal year 2008, this account also 
includes pay and associated costs for information technology 
maintenance and operations staff.
    In describing the new structure of the VA's IT budget 
submission, the VA states that:
          The proposed FY 2009 budget has been realigned from 
        previous submissions to delineate veteran strategic 
        issues into two major classifications--veteran facing 
        IT systems and internal facing IT systems. Veteran 
        facing IT systems include IT programs that directly 
        impact current and future veterans' services and 
        account for $1.295 billion or 75.6 percent of 
        resources. Internal facing IT systems indirectly affect 
        veterans' services through IT administrative and 
        infrastructure support at $418 million or 24.4 percent 
        of resources.
          Within each of the two classifications, IT programs 
        and initiatives were further classified to reflect the 
        two core processes of development and operations and 
        maintenance. These changes complement the Department's 
        Performance and Accountability Report structure, 
        thereby enabling better communication of performance 
        results and outcomes. As a result, all veteran facing 
        IT systems fall under one of the following eight 
        Performance Accountability Report categories: medical 
        care, compensation, pension, education, vocational 
        rehabilitation, housing, insurance, and burial. 
        Internal facing IT systems are mapped to eight programs 
        for corporate management, financial resources 
        management, asset management, human capital management, 
        IT infrastructure, cyber security, privacy, and E-
        Government (E-Gov). Additionally, infrastructure 
        activities are aligned as a sub-cost for each 
        Performance Accountability Report category. (Emphasis 
        in original). (FY 2009 VA Budget Submission, Volume 2, 
        4A-3).

Recommendation

    For FY 2009, the Administration has requested $2.442 
billion for the Information Technology Systems account, an 
increase of $476 million, or 24 percent, over the amount 
provided in FY 2008.
    The Committee recommends that the Administration's 
requested funding level be provided.
    The Committee understands that as the VA moves to a 
centralized IT system that the IT budget is, by necessity, a 
``work in progress.'' The Committee believes that the VA should 
be nearing the point where it has a clear and consistent view 
of its IT funding requirements. The Government Accountability 
Office, in testimony before the Subcommittee on Oversight and 
Investigations regarding the VA's FY 2009 IT budget request, 
noted that the VA is ``in the initial stages of implementing 
new management process that are critical to centralizing its 
control over the IT resources and budget''. The GAO also 
testified that ``it remains too early to assess [the new 
management processes] their overall impact because most of the 
actions taken have only recently become operational or have not 
yet been fully implemented. Thus, their effectiveness in 
ensuring accountability for the resources and budget has not 
yet been clearly established.'' (Testimony before the 
Subcommittee on Oversight and Investigations, House Committee 
on Veterans' Affairs, February 13, 2008 (GAO-08-449T)).
    As the Committee noted under the General Operating Expenses 
account, the VA must act vigorously to realize a true 
electronic benefits system. Although Virtual VA is a step 
forward, merely scanning in paper documents does not begin to 
realize the advantages that a true electronic benefits system 
can yield to veterans seeking benefits.
    The Committee notes with approval the VA's assurance that 
Medical Center Innovations will be funded in FY 2009, contrary 
to the Administration's FY 2009 budget submission. The 
Committee also looks to the VA to provide assurances that it 
has sufficient resources to provide the ``gold standard'' in 
data security.

                    National Cemetery Administration


----------------------------------------------------------------------------------------------------------------
                                                          Independent           FY 2009       Recommendation vs.
        FY 2008  Enacted           FY 2009  Request         Budget          Recommendation          Request
----------------------------------------------------------------------------------------------------------------
195,000,000.....................        180,959,000         251,975,000         210,250,000         +29,291,000
----------------------------------------------------------------------------------------------------------------

Description

    The National Cemetery Administration was established in 
accordance with the National Cemeteries Act of 1973. It has a 
fourfold mission: to provide for the interment in any national 
cemetery with available grave space the remains of eligible 
deceased servicepersons and discharged veterans, together with 
their spouses and certain dependents, and to permanently 
maintain their graves; to mark graves of eligible persons in 
national and private cemeteries; to administer the grant 
program for aid to States in establishing, expanding, or 
improving State veterans' cemeteries; and to administer the 
Presidential Memorial Certificate Program. This appropriation 
provides for the operation and maintenance of 158 cemeterial 
installations in 39 states, the District of Columbia, and 
Puerto Rico.

Recommendation

    For FY 2009, the Administration has requested $181 million 
for the National Cemetery Administration, $14 million, or 7 
percent, below FY 2008 levels. The Committee recommends $210 
million for FY 2009, $15 million above the FY 2008 level and 
$29 million above the Administration's request.
    The Administration request proposes to cut funding for 
recurring maintenance and repair projects by $27 million below 
FY 2008 levels, and $5 million below the amount provided in FY 
2007. The Committee recommendation restores this cut.
    The Committee applauds the Administration's proposal to 
``establish a non-recurring maintenance (NRM) program focusing 
on the correction of deficiencies cited in the Facility 
Condition Assessments and Five Year Plan.'' The Administration 
proposes $2 million for this activity. The Committee recommends 
doubling this amount to $4 million.
    The Committee recommendation would:
     Restore proposed cuts to the Maintenance and 
Repair (Recurring) budget--$27 million;
     Double the amount provided for Non-Recurring 
Maintenance--$2 million.

                      Office of Inspector General


----------------------------------------------------------------------------------------------------------------
                                                          Independent           FY 2009       Recommendation vs.
        FY 2008  Enacted           FY 2009  Request         Budget          Recommendation          Request
----------------------------------------------------------------------------------------------------------------
80,500,000......................         76,500,000          83,158,000          89,645,000         +13,145,000
----------------------------------------------------------------------------------------------------------------

Description

    The Office of Inspector General was established by the 
Inspector General Act of 1978 and is responsible for the audit, 
investigation and inspection of all Department of Veterans 
Affairs programs and operations. The overall operational 
objective is to focus available resources on areas which would 
help improve services to veterans and their beneficiaries, 
assist managers of Department programs to operate economically 
in accomplishing program goals, and prevent and deter recurring 
and potential fraud, waste and inefficiencies.

Recommendation

    The Administration has requested $76.5 million for the 
Office of Inspector General for FY 2009, a decrease of $4 
million below the FY 2008 level of $80.5 million. The VA's 
request assumes a total FTE level of 465, 56 fewer than the 
total currently estimated for FY 2008 and five fewer FTE than 
in 2007.
    The Committee recommends $89.6 million for FY 2009, an 
increase of $9.1 million, or 11 percent over FY 2008 levels and 
$13.1 million, or 17 percent, above the VA's FY 2009 request.
    The Committee recommendation restores the proposed FTE cuts 
and adds additional FTE to match last year's Committee-
recommended FTE level.
    In testimony before the Subcommittee on Oversight and 
Investigations on February 13, 2008, Jon A. Wooditch, Deputy 
Inspector General, Office of Inspector General, U.S. Department 
of Veterans Affairs stated that ``[t]he OIG seeks to help VA 
become the best-managed service delivery organization in 
Government. OIG audits, health care inspections, 
investigations, and Combined Assessment Program (CAP) reviews 
recommend improvements in VA programs and operations, and act 
to deter waste, fraud, abuse, and mismanagement. For 2007, OIG 
funding supported 443 FTE from appropriations. An additional 25 
FTE was funded under a reimbursable agreement with VA to 
perform pre-award and post-award contract reviews. During 2007, 
the OIG exceeded its overall performance goals. For example, 
monetary benefits for the year were $820 million, for a return 
on investment of $12 for every dollar expended. Collectively, 
the OIG issued a total of 217 audit, health care inspection, 
and contract review reports, with over 500 recommendations for 
corrective action. We also completed 1,181 criminal 
investigations, which led to 2,061 arrests, indictments, 
convictions, and administrative sanctions. We also responded to 
over 19,000 contacts received by the OIG Hotline.''
    The Committee believes that vigorous oversight of the VA is 
essential to ensure that the Department provides quality health 
care and benefits to veterans in an efficient, fair and cost-
effective manner. Since the beginning of this Congress, the 
Committee has embarked on an ambitious oversight agenda, and 
the OIG is an important partner in this ongoing initiative. The 
economic benefit realized to taxpayers by investment in the 
OIG, as well as programmatic improvements resulting from the 
Inspector General's activities, have been clearly demonstrated. 
As the OIG is being expected to do more, it is vital that 
proposed cuts to FTE be restored and the overall FTE level be 
increased to meet expected workload increases.
    The Committee recommendation would:
     Restore proposed cuts of 56 FTE--$7 million;
     Provide for an additional 49 FTE, for a total FTE 
level of 570--$6 million.

                      Construction, Major Projects


----------------------------------------------------------------------------------------------------------------
                                                          Independent           FY 2009       Recommendation vs.
        FY 2008  Enacted           FY 2009  Request         Budget          Recommendation          Request
----------------------------------------------------------------------------------------------------------------
1,069,100,000...................        581,582,000       1,275,000,000       1,092,094,000        +510,512,000
----------------------------------------------------------------------------------------------------------------

Description

    The Construction, Major Projects appropriation provides for 
constructing, altering, extending, and improving any of the 
facilities under the jurisdiction or for the use of the 
Department of Veterans Affairs, including planning, 
architectural and engineering services, assessments, and site 
acquisition where the estimated cost of a project is 
$10,000,000 or more.

Recommendation

    For FY 2009, the Administration is requesting $582 million, 
a decrease of $488 million, or 46 percent, from the FY 2008 
level of $1.1 billion. The Administration's request includes 
$472 million for VHA-related construction and $105 million for 
NCA-related construction.
    The NCA portion of the request seeks funds for gravesite 
expansion and cemetery improvements at the Puerto Rico National 
Cemetery, Massachusetts National Cemetery, and the Calverton 
National Cemetery. The request also seeks funding for the 
Advance Planning Fund, NCA Land Acquisition Fund, and 
Sustainability and Energy Fund.
    The VHA-related construction request, totaling $472 
million, seeks funding for the following projects:
Denver, CO--New Medical Facility
     Total Estimated Cost--$769.2 million; Funding 
through FY 2008--$168.3 million; FY 2009 Request--$20 million
Orlando, FL--New Medical Facility
     Total Estimated Cost--$656.8 million; Funding 
through FY 2008--$74.1 million; FY 2009 Request--$120 million
    San Juan, PR--Seismic Corrections Bldg. 1
     Total Estimated Cost--$225.9 million; Funding 
through FY 2008--$69.9 million; FY 2009 Request--$64.4 million
Lee County FL--Outpatient Clinic
     Total Estimated Cost--$131.8 million; Funding 
through FY 2008--$20.4 million; FY 2009 Request--$111.4 million
St. Louis (JB), MO--Medical Facility Improvements and Cemetery 
Expansion
     Total Estimated Cost--$134.5 million; Funding 
through FY 2008--$7 million; FY 2009 Request--$5 million
Bay Pines, FL--Inpatient/Outpatient Improvements
     Total Estimated Cost--$174.3 million; Funding 
through FY 2008--$0 million; FY 2009 Request--$17.4 million
Tampa, FL--Polytrauma Expansion and Bed Tower Upgrades
     Total Estimated Cost--$223.8 million; Funding 
through FY 2008--$0 million; FY 2009 Request--$21.1 million
Palo Alto, CA--Centers for Ambulatory Care and Polytrauma 
Rehabilitation Center
     Total Estimated Cost--$450.3 million; Funding 
through FY 2008--$0 million; FY 2009 Request--$38.3 million
    The Committee recommends a funding level of $1.1 billion, 
$511 million above the Administration's request and $23 million 
above the level provided in FY 2008. The Administration has 
requested funding for the CARES priority projects 1-3 (Bay 
Pines, FL; Tampa, FL; and Palo Alto, CA). The Committee 
recommendation includes planning funding for CARES priority 
projects 4-20:
     Seattle, WA--Seismic NHCU Bldg. 100 (#4)
     Seattle, WA--Mental Health Building 101 Seismic 
(#5)
     Dallas, TX--Spinal cord Injury Center (#6)
     Louisville, KY--New Medical facility (#7)
     Roseburg, OR--Mental Health Bldg. 2 Seismic (#8)
     Los Angeles, CA--Seismic Corrections of 13 
Buildings (#9)
     Bronx, NY--Spinal cord Injury Center (#10)
     Butler, PA--Outpatient Clinic (#11)
     American Lake, WA--Seismic corrections Bldg. 81 
(#12)
     Dallas, TX--Clinical Expansion for Mental Health 
(#13)
     Walla Walla, WA--Multi-specialty Clinic (#14)
     San Francisco, CA--Seismic Corrections Buildings 
1, 6, 8, and 12 (#15)
     Wichita, KA--Med/Surg Bed Modernization/Ambulatory 
Expansion (#16)
     Fayetteville, NC--Outpatient Addition (#17)
     Salisbury, NC--Clinical Addition (#18)
     Columbia, SC--Diagnostics and Specialty Care 
Clinics Renovation (#19)
     Birmingham, AL--Huntsville Outpatient Clinic (#20)
    Although not on the CARES list, the Committee believes the 
needs of veterans in South Texas have gone unmet for far too 
long, and believes that the VA should undertake a major project 
that will meet the inpatient and outpatient needs of these 
veterans in a centrally located facility.
    In addition, the Committee believes that the VA should 
enter into a sharing agreement with the Department of Defense 
to make inpatient care available to veterans at Eglin Air Force 
Base in Florida, as well as begin constructing a joint VA/DoD 
outpatient medical facility.
    It is essential that the VA invest the resources needed to 
address its aging infrastructure and provide state-of-the-art 
modern medical facilities. This will require a sustained 
commitment to providing adequate funding levels for the VA's 
Major Construction program. This will also require a commitment 
from the VA to substantially increase its in-house ability to 
manage large and complex construction projects. Assisting the 
VA in improving its abilities and expertise in this area was a 
driving force behind the creation of the office of Director of 
Construction and Facilities Management last Congress.
    The Committee also desires to see the VA begin to take 
action to begin planning and development of new national 
cemeteries in Southern Colorado, Nevada (which does not have a 
national cemetery), and Eastern Nebraska (Sarpy County).
    The recommended increase would also provide the remaining 
funding needed for the Pittsburgh, PA Campus Consolidation 
project, and additional resources, above the Administration's 
request, for the Orlando, Florida, Medical Facility project. 
The recommendation would provide additional funding for the 
VA's Advanced Planning Fund and the Sustainability and Energy 
Fund.
    The Committee trusts that as major facilities come on-line 
in the years ahead, that sufficient funding for equipment, 
staffing, and activation are provided for fully and included 
early in the VA's budget process in order not to require 
shifting funds from other areas of the VA budget.
    The Committee recommendation would:
     Provides planning funding for top-20 priority 
CARES projects not previously funded (or funded in FY 2009 
request) and other projects--$187 million;
     Provides an additional $231 million for the 
Orlando, Florida project;
     Provides remaining $62 million needed for 
Pittsburgh, Pennsylvania campus consolidation project;
     Provides an additional $25 million for the Advance 
Planning Fund;
     Doubles the amount provided for the Sustainability 
and Energy fund for VHA--$5 million.

                      Construction, Minor Projects


----------------------------------------------------------------------------------------------------------------
                                                          Independent           FY 2009       Recommendation vs.
        FY 2008  Enacted           FY 2009  Request         Budget          Recommendation          Request
----------------------------------------------------------------------------------------------------------------
630,535,000.....................        329,418,000         621,000,000         673,718,000        +344,300,000
----------------------------------------------------------------------------------------------------------------

Description

    The Construction, Minor Projects, appropriation provides 
for constructing, altering, extending, and improving any of the 
facilities under the jurisdiction or for the use of the 
Department, including planning, assessment of needs, 
architectural and engineering services, and site acquisition, 
where the estimated cost of a project is less than $10,000,000.

Recommendation

    For FY 2009, the Administration has requested $329 million, 
a decrease of $301 million, or 48 percent below the level 
provided in FY 2008. The Committee recommends $674 million, $43 
million above FY 2008 and $344 million above the 
Administration's request.
    Based upon the Administration's 5-year Capital Plan list of 
``FY 2008 Prioritized VHA Minor Construction Projects,'' \4\ 
the average total estimated cost for the top 50 listed projects 
is $5.7 million. The Committee recommendation includes $287 
million to provide for an additional 50 projects for FY 2009. 
The Committee notes that this amount funds the complete average 
cost of these projects: the VA may be able to undertake 
additional projects above the 50 provided for since total costs 
of each project are not required to be provided all at once. 
The Committee desires the VA to be more aggressive in tackling 
its backlog of minor construction projects.
---------------------------------------------------------------------------
    \4\ FY 2009 VA Budget Submission, Volume 4, 7-90 et seq.
---------------------------------------------------------------------------
    The Committee recommendation also provides a 50 percent 
increase for minor construction for the National Cemetery 
Administration (NCA). The Administration proposes $25 million 
for this construction for FY 2009, an amount equal to the FY 
2007 funding level and $50 million below the FY 2008 current 
estimate. The Committee recommendation would add an additional 
$12.5 million for NCA minor construction projects.
    The Committee is recommending $45 million to provide 
funding to upgrade and modernize VA research facilities. The 
Subcommittee on Health, in a hearing on the VHA's FY 2008 
budget request held on February 14, 2007, received testimony 
from the Friends of VA Medical Care and Health Research (FOVA). 
FOVA recommended ``an annual appropriation of $45 million in 
the minor construction budget dedicated to renovating existing 
research facilities[.]'' The Committee notes that the FY 2007 
VA appropriations bill, as passed by the House of 
Representatives, included $12 million in the minor construction 
account ``to be used solely for a program of upgrade and 
modernization of research facilities to ensure they maintain or 
attain state-of-the-art status.'' (H. Rept. 109-464, to 
accompany H.R. 5385, the Military Quality of Life and Veterans 
Affairs and Related Agencies Appropriations Bill, at 64). The 
Committee on Appropriations directed the VA to conduct a 
comprehensive review of its research facilities and to report 
to Congress by March 1, 2007. The VA has indicated that this 
review may take three years to complete. Funding for VA 
research facilities was not provided in FY 2008. The 
Committee's recommended level of $45 million mirrors the 
recommendation made by FOVA.
    The Committee would also like the VA to take action in 
repairing and remodeling existing facilities in Livermore, 
California, to provide for a PTSD Rehabilitation clinic.
    The Committee recommendation would:
     Provide full funding for an additional 50 Minor 
Construction projects--$287 million;
     Provide a 50 percent increase above the FY 2009 
request for NCA minor construction projects--$13 million;
     Provide funding to begin to upgrade and modernize 
VA research facilities--$45 million.

       Grants for Construction of State Extended Care Facilities


----------------------------------------------------------------------------------------------------------------
                                                                                FY 2009       Recommendation vs.
         FY 2008 Enacted            FY 2009 Request   Independent Budget    Recommendation          Request
----------------------------------------------------------------------------------------------------------------
165,000,000.....................         85,000,000         200,000,000         200,000,000        +115,000,000
----------------------------------------------------------------------------------------------------------------

Description

    This program provides grants to assist States to construct 
State home facilities, for furnishing domiciliary or nursing 
home care to veterans, and to expand, remodel or alter existing 
buildings for furnishing domiciliary, nursing home or hospital 
care to veterans in State homes. A grant may not exceed 65 
percent of the total cost of the project.

Recommendation

    For FY 2009, the Administration requests $85 million for 
the Grants for Construction of State Extended Care Facilities 
account, $80 million below the level provided in FY 2008. The 
Committee is recommending $200 million, an increase of $35 
million above FY 2008 and $115 million above the 
Administration's request.
    The VA's ``Priority List of Pending State Home Construction 
Grant Applications for FY 2008'' lists a total of $553 million 
in Priority 1 applications. In FY 2007, these projects totaled 
$491 million. In FY 2006, there were 80 priority group 1 
projects for a total of $420 million. Priority 1 projects are 
those projects that have State funding in place to start 
construction and are awaiting VA funding. State homes play an 
important role in VA's long-term care strategy by filling the 
gap of available beds for elderly and sick veterans who need 
them. As the VA is facing an aging veteran population, the 
Committee believes it is essential to provide the resources 
needed to begin to tackle the project backlog.
    The Committee recommendation would:
     Provide additional resources to enable the VA to 
begin to reduce the State Home project backlog--$115 million.

          Grants for Construction of State Veterans Cemeteries


----------------------------------------------------------------------------------------------------------------
                                                          Independent           FY 2009       Recommendation vs.
        FY 2008  Enacted           FY 2009  Request         Budget          Recommendation          Request
----------------------------------------------------------------------------------------------------------------
39,500,000......................         32,000,000          42,000,000          39,500,000          +7,500,000
----------------------------------------------------------------------------------------------------------------

Description

    This program provides grants to assist States with the 
establishment, expansion, and improvement of State veterans' 
cemeteries which are operated and permanently maintained by the 
States. Grants under this program fund up to 100 percent of 
construction costs and the initial equipment expenses when the 
cemetery is established. The States remain responsible for 
providing the land and for paying all costs related to the 
operation and maintenance of the State cemeteries, including 
the costs for subsequent equipment purchases.

Recommendation

    The Administration, for FY 2009, requests $32 million for 
the Grants for Construction of State Veterans Cemeteries 
program, a level $7.5 million, or 19 percent, below the FY 2008 
level. The Committee recommends a funding level equal to the 
amount provided in FY 2008.
    The Committee recommendation would:
     Restore proposed Administration cut--$7.5 million.

                          DEPARTMENT OF LABOR 


                    Veterans Employment and Training


  DEPARTMENT OF LABOR--VETERANS EMPLOYMENT AND TRAINING SERVICE (VETS)

    The Assistant Secretary for VETS serves as the principal 
advisor to the Secretary of Labor on all policies and 
procedures affecting veterans' employment matters. VETS 
furnishes employment and training services to servicemembers 
and veterans through a variety of programs, including providing 
grants to States, public entities and non-profit organizations, 
including faith-based organizations, to assist veterans seeking 
employment. VETS also investigates complaints filed under 
veterans' preference and re-employment laws. Specifically, VETS 
administers the following programs: DVOP/LVER state grant 
program; Transition Assistance Program; Veterans' Preference 
and Uniformed Services Employment and Reemployment Rights Act 
(USERRA); Homeless Veterans' Reintegration Program (HVRP); 
Veterans Workforce Investment Program (VWIP); Federal 
Contractor Program; and the National Veterans' Training 
Institute (NVTI). The Administration requested a total of 
$238.4 million in FY 2009 to support the staffing and grant-
making ability of VETS. This is a $10 million, or 4 percent, 
increase over FY 2008. For FY 2009, the Committee recommends an 
increase of $60 million for VETS, for a total of $298 million. 
This recommended level would provide an additional $31 million 
for State Grants to bring up the level of DVOPs/LVERs from the 
current 2,100 to the original 2,500. This will help VETS better 
manage the One Stop Centers and provide better priority 
services to veterans. The recommended funding will also provide 
an additional $10 million to HVRP. Although accurate numbers 
are impossible to come by--no one keeps national records on 
homeless veterans--the VA estimates that nearly 200,000 
veterans are homeless on any given night and nearly 400,000 
experience homelessness over the course of a year. According to 
the National Survey of Homeless Assistance Providers and 
Clients (U.S. Interagency Council on Homelessness and the Urban 
Institute, 1999), veterans account for 23 percent of all 
homeless people in America. The Committee also recommends 
increasing the funding level for VWIP to $30 million. This 
program currently operates only in 11 states and should be 
expanded to more areas, especially those with a heavy veteran 
population. The funding for NVTI should be increased by $1 
million to assist NVTI in providing the training necessary to 
be a successful DVOP/LVER. This training is required to be 
provided within three years of the appointment of the DVOP/
LVER. Finally, the Committee urges the Department of Labor to 
explore innovative job training efforts for returning 
servicemembers to assist them in integrating into civilian 
life.

                             OTHER AGENCIES


                  American Battle Monuments Commission


----------------------------------------------------------------------------------------------------------------
                                                          Independent           FY 2009       Recommendation vs.
        FY 2008  Enacted           FY 2009  Request         Budget          Recommendation          Request
----------------------------------------------------------------------------------------------------------------
44,600,000......................         47,470,000                 N/A          47,470,000                   0
----------------------------------------------------------------------------------------------------------------

Description

    The American Battle Monuments Commission is responsible for 
the administration, operation and maintenance of cemetery and 
war memorials to commemorate the achievements and sacrifices of 
the American Armed Forces where they have served since April 6, 
1917. In performing these functions, the Commission maintains 
24 permanent American military cemetery memorials and 31 
monuments, memorials, markers and offices in 15 foreign 
countries, the Commonwealth of the Northern Mariana Islands, 
and the British dependency of Gibraltar. In addition, six 
memorials are located in the United States: the East Coast 
Memorial in New York; the West Coast Memorial, the Presidio in 
San Francisco; the Honolulu Memorial in the National Memorial 
Cemetery of the Pacific in Honolulu, Hawaii; and, the American 
Expeditionary Forces Memorial and the World War II and Korean 
War Veterans Memorials in Washington, D.C.

Recommendation

    The American Battle Monument Commission is seeking a total 
of $64.6 million for FY 2009, consisting of $47.5 million for 
salaries and expenses, and $17.1 million for costs associated 
with foreign currency fluctuations.
    The Committee recommends the requested level of $47.5 
million be provided in FY 2009.

               U.S. Court of Appeals for Veterans Claims


----------------------------------------------------------------------------------------------------------------
                                                          Independent           FY 2009       Recommendation vs.
        FY 2008  Enacted           FY 2009  Request         Budget          Recommendation          Request
----------------------------------------------------------------------------------------------------------------
22,717,000......................         23,975,000                 N/A          23,975,000                   0
----------------------------------------------------------------------------------------------------------------

Description

    The Veterans' Judicial Review Act [P.L. 100-687] 
established the U.S. Court of Appeals for Veterans Claims. The 
Court reviews appeals from Department of Veterans Affairs 
claimants seeking review of a benefit denial. The Court has the 
authority to overturn findings of fact, regulations, and 
interpretations of law.

Recommendation

    The Court's request for FY 2009 of $24 million includes 
$1.7 million for the Pro Bono Representation Program. This 
program is administered by the Legal Services Corporation. The 
Court includes the Program's FY 2009 request as an appendix to 
its submission; although having ``no comment on that request'' 
applauds the ``Program's continuing success in reducing the 
percentage of unrepresented appellants before the Court. Since 
1997, the percentage of appellants who are unrepresented at the 
decision point of their appeals has dropped from 48% in FY 1997 
to 19% or less in FY 2007.''
    The Committee recommends the requested level of $24 million 
be provided in FY 2009.

                           MERCHANT MARINERS 

    World War II Merchant Mariners suffered the highest 
casualty rate of any of the branches of service while they 
delivered troops, tanks, food, airplanes, fuel, and other 
needed supplies to every theater of the war. Despite their 
efforts during the war, Merchant Mariners were not covered by 
the original G.I. Bill of Rights. No legislation to benefit 
merchant seamen was passed by Congress until 1988 when the 
Seaman Acts of 1988 finally granted them a ``watered down'' 
G.I. Bill of Rights. To make up for lost benefits and 
opportunities, the House of Representatives passed H.R. 23, the 
Belated Thank You to the Merchant Mariners of World War II Act 
of 2007. This measure provides authorization for $120 million 
in FY 2008 and $108 million in FY 2009. The Committee 
recommends that this funding be made available to recognize the 
service and sacrifice of our Merchant Mariners.

                     SECTION 2--MANDATORY ACCOUNTS


 FULL EQUITY FOR WORLD WAR II FILIPINO VETERANS WHO SERVED IN THE U.S. 
                                  ARMY

    Many World War II Filipino veterans, who served and fought 
alongside American servicemembers during World War II, do not 
receive veterans' benefits. Shortly after the war, Congress 
passed the Rescission Acts which stripped away many veterans' 
benefits for Filipino servicemembers who served in the U.S. 
Army. For the past 60 years, Congress has taken a piece-meal 
approach to restoring these benefits.
     The Committee plans to work with the leadership of 
the House of Representatives and our counterparts in the Senate 
to end this iniquity once and for all and provide VA benefits 
and services to these deserving veterans.

                          TOTAL FORCE GI BILL

    The Montgomery GI Bill (MGIB), implemented over 20 years 
ago, was a landmark piece of legislation that provided 
education and training benefits to many veterans. The time has 
come to update, modernize, and provide greater flexibility to 
meet the needs of today's veterans. For GI Bill education 
benefits to remain a relevant recruitment, and readjustment 
benefit, we must ensure that VA's education and training 
programs reflect the manner in which individuals earn and learn 
in the 21st Century.
    Due to advances in technology, recognition of the lifetime 
learning concept, dynamic workforce changes, and ever-
increasing demands on military recruiting efforts, Congress 
should continue to review current MGIB entitlements and make 
necessary changes to provide servicemembers, veterans and their 
families relevant education and training benefits that meet 
their educational and vocational goals for success.
    The Committee plans, on a bipartisan basis, to explore a 
number of options to improve and modernize the GI Bill. The 
VA's Advisory Committee on Education and the Partnership for 
Veterans Education--a group made up of traditional veterans and 
military service organizations, as well as higher education 
advocates all have endorsed a proposal termed the ``Total Force 
GI Bill.'' The proposal has two unmet features which include: 
providing parity of education benefit rates according to 
service rendered; and ensuring future correlation of active 
duty, veterans, and National Guard and Reserve benefits in an 
equitable and proportional manner, Chapters 1606 and 1607 in 
Title 10 and Chapter 30 in Title 38 need to be reorganized 
together under Title 38.
    Congress recently expanded MGIB entitlements for our 
Nation's Guard and Reserve Forces. The National Defense 
Authorization Act for Fiscal Year 2008 (P.L. 110-181) includes 
language that would allow certain members of the Reserve Forces 
to use their REAP (Chapter 1607 of Title 10) education benefits 
during the 10-year period beginning on the date which they 
separated.
    President Bush proposed, in his State of the Union Address, 
that Congress expand on MGIB entitlements to allow 
servicemembers and veterans to transfer their unused benefits 
to their spouses and children. While the President did not 
request funding for this proposal in his FY 2009 budget 
request, Congress will explore the idea of transferring 
education benefits to dependents along with other proposals.
    Major legislative proposals that have been highlighted by 
veteran service organizations include: eliminating MGIB 
benefits from being considered as income for eligibility 
requirements for Federal grants or loans; expand accelerated 
benefits to all areas; increase the monthly benefit amount; 
eliminate the $1,200 enrollment fee for MGIB; allow 
servicemembers to use the GI Bill to repay loans once they are 
eligible for the GI Bill, they can pay $6,000 up to the amount 
they are qualified; protect servicemembers with education 
interruptions due to military service; and expand the period of 
use for educational entitlements.

                  MANDATORY FUNDING FOR VA HEALTH CARE

    Facing years of insufficient VA health care budgets 
provided consistently after the start of the fiscal year, a 
coalition of veterans service organizations formed the 
Partnership for Veterans Health Care Budget Reform, to advocate 
for providing mandatory, or ``assured'' funding for VA health 
care. The Committee held a hearing in October 2007 on funding 
the VA of the future at which the Partnership, budget experts, 
and the VA testified. At this hearing, there was much 
discussion regarding how the VA would fare in direct 
competition with other mandatory programs, as well as the 
sufficiency and flexibility of a mandatory funding formula.
    Veterans have fared better at the hands of Congress than 
they have with this Administration. From FY 2002-FY 2008, the 
Administration's health care budget requests represent slightly 
less than half of the amount finally provided to the VA. The 
110th Congress has provided unprecedented increases for 
veterans' programs, although we note that funding for the VA 
was not finally put in place until nearly three months after 
the start of the current fiscal year.
    Many on the Committee believe that funding VA health care 
with mandatory dollars as compared to discretionary dollars, as 
advocated by the Partnership, would provide the VA with stable 
and adequate funding to meet the needs of veterans.
    The Committee urges Congress to seriously consider the best 
manner in which to fund VA health care, and provide sufficient 
and timely funding for veterans. Providing a mandatory funding 
mechanism for VA health care will require cooperation in 
Congress, and cooperation between Congress, the Administration, 
and the VA, in order to insure that the funding mechanism 
decided upon meets the needs of the Department, and the 
veterans who rely on the VA for the health care they need.

                           SECTION 3--CHARTS

    Department of Veterans Affairs Discretionary Accounts FY 
2009
    Department of Veterans Affairs Account Comparisons

                                                       Department of Veterans Affairs--FY 2009--Discretionary Accounts--February 28, 2008
                                                                                         (in thousands)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                FY 2009                                                                                        FY 2009 Committee
                       Account                              FY 2008           President's       FY 2009 Request         FY 2009        FY 2009 Committee   FY 2009 Committee      vs. FY 2009
                                                                                Request           vs. FY 2008     Independent Budget    Recommendation        vs. FY 2008           Request
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Medical Services....................................         29,104,220          29,465,503             361,283          32,153,138          31,656,100           2,551,880           2,190,597
Medical Administration..............................          3,517,000           4,610,000           1,093,000           3,625,762           4,610,000           1,093,000                   0
Medical Facilities..................................          4,100,000           4,661,000             561,000           4,576,143           4,971,000             871,000             310,000
                                                     -------------------------------------------------------------------------------------------------------------------------------------------
    Total, Medical Care.............................         36,721,220          38,736,503           2,015,283          40,355,043          41,237,100           4,515,880           2,500,597
MCCF Collections....................................          2,414,000           2,466,860              52,860           2,466,860           2,466,860              52,860                   0
                                                     -------------------------------------------------------------------------------------------------------------------------------------------
    Total, Medical Care (with Collections)..........         39,135,220          41,203,363           2,068,143          42,821,903          43,703,960           4,568,740           2,500,597
Medical and Prosthetic Research.....................            480,000             442,000             -38,000             555,000             555,000              75,000             113,000
================================================================================================================================================================================================
    Total, Veterans Health Administration (excluding         37,201,220          39,178,503           1,977,283          40,910,043          41,792,100           4,590,880           2,613,597
     collections)...................................
General Operating Expenses..........................          1,605,000           1,699,867              94,867           1,985,602           1,896,126             291,126             196,259
Information Technology Systems......................          1,966,465           2,442,066             475,601           2,164,938           2,442,066             475,601                   0
National Cemetery Administration....................            195,000             180,959             -14,041             251,975             210,250              15,250              29,291
Office of Inspector General.........................             80,500              76,500              -4,000              83,158              89,645               9,145              13,145
Construction, Major Projects........................          1,069,100             581,582            -487,518           1,275,000           1,092,094              22,994             510,512
Construction, Minor Projects........................            630,535             329,418            -301,117             621,000             673,718              43,183             344,300
Grants for Construction of State Extended Care                  165,000              85,000             -80,000             200,000             200,000              35,000             115,000
 Facilities.........................................
Grants for Construction of State Veterans Cemeteries             39,500              32,000              -7,500              42,000              39,500                   0               7,500
================================================================================================================================================================================================
    Total Departmental Administration...............          5,751,100           5,427,392            -323,708           6,623,673           6,643,399             892,299           1,216,007
Other Discretionary.................................            155,572             158,237               2,665             160,084             158,237               2,665                   0
================================================================================================================================================================================================
    Total Discretionary (Excludes Collections)......         43,107,892          44,764,132           1,656,240          47,693,800          48,593,736           5,485,844          3,829,604
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
* Amounts attributable to medical collections have been subtracted from the Independent Budget recommendation for Medical Services and added to the MCCF Collections line.


                                                         Department of Veterans Affairs--FY 2009--Account Comparisons--February 28, 2008
                                                                                         (in thousands)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                           Administration's                                                                    HVAC vs.
                       Account                              FY 2008             Request               IB                 HVAC             HVAC v. IB        Administration      HVAC v. FY 2008
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Medical Services....................................         29,104,220          29,465,503          32,153,138          31,656,100            -497,038           2,190,597           2,551,880
Medical Administration..............................          3,517,000           4,610,000           3,625,762           4,610,000             984,238                   0           1,093,000
Medical Facilities..................................          4,100,000           4,661,000           4,576,143           4,971,000             394,857             310,000             871,000
                                                     -------------------------------------------------------------------------------------------------------------------------------------------
    Total, Medical Care.............................         36,721,220          38,736,503          40,355,043          41,237,100             882,057           2,500,597           4,515,880
MCCF Collections....................................          2,414,000           2,466,860           2,466,860           2,466,860                   0                   0              52,860
                                                     -------------------------------------------------------------------------------------------------------------------------------------------
    Total, Medical Care (with Collections)..........         39,135,220          41,203,363          42,821,903          43,703,960             882,057           2,500,597           4,568,740
Medical and Prosthetic Research.....................            480,000             442,000             555,000             555,000                   0             113,000              75,000
                                                     ===========================================================================================================================================
    Total VHA (Medical Care and Research excluding           37,201,220          39,178,503          40,910,043          41,792,100           1,764,114           5,114,194           9,212,480
     Collections)...................................
General Operating Expenses..........................          1,605,000           1,699,867           1,985,602           1,896,126             -89,476             196,259             291,126
Information Technology Systems......................          1,966,465           2,442,066           2,164,938           2,442,066             277,128                   0             475,601
National Cemetery Administration....................            195,000             180,959             251,975             210,250             -41,725              29,291              15,250
Office of Inspector General.........................             80,500              76,500              83,158              89,645               6,487              13,145               9,145
Construction, Major Projects........................          1,069,100             581,582           1,275,000           1,092,094            -182,906             510,512              22,994
Construction, Minor Projects........................            630,535             329,418             621,000             673,718              52,718             344,300              43,183
Grants for Construction of State Extended Care                  165,000              85,000             200,000             200,000                   0             115,000              35,000
 Facilities.........................................
Grants for Construction of State Veterans Cemeteries             39,500              32,000              42,000              39,500              -2,500               7,500                   0
                                                     -------------------------------------------------------------------------------------------------------------------------------------------
    Total, Departmental Administration..............          5,751,100           5,427,392           6,623,673           6,643,399              19,726           1,216,007             892,299
Other Discretionary.................................            155,572             158,237             160,084             158,237              -1,847                   0               2,665
                                                     ===========================================================================================================================================
    Total, VA Discretionary.........................         43,107,892          44,764,132          47,693,800          48,593,736             899,936           6,330,201         10,107,444
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
* Amounts attributable to medical collections have been subtracted from the Independent Budget recommendation Medical Services and added to the MCCF Collections line.


                   REPUBLICAN LETTER OF TRANSMITTAL 

                                ------                                

                          House of Representatives,
                            Committee on Veterans' Affairs,
                                 Washington, DC, February 28, 2008.
Hon. John Spratt,
Chairman, Committee on the Budget,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: Pursuant to House Rule X, clause 
4(f)(1), I herewith submit to the Committee on the Budget the 
Views and Estimates of the Republican Members of the Committee 
on Veterans' Affairs regarding the Administration's FY 2009 
budget request with regard to programs and matters within the 
jurisdiction of the Committee, along with Supplemental Views 
and Estimates.
    In recommending record discretionary funding for veterans' 
health care and benefits, the Republican Budget Views and 
Estimates reflects our enduring priorities: to care for 
veterans who have service-connected disabilities, those with 
special needs, and the indigent; to ensure a seamless 
transition from military service to the care of the Department 
of Veterans Affairs (VA); and to provide veterans every 
opportunity to live full, healthy lives.
    We look forward to working with the Committee's Majority 
Members as well as the Members of the Budget Committee to put 
forth a budget that will honor and enhance the lives of our 
nation's veterans, as well as remain fiscally responsible to 
the American taxpayer.
            Sincerely,
                    Steve Buyer, Ranking Republican Member; Cliff 
                            Stearns, Deputy Ranking Republican Member; 
                            Jerry Moran, Committee Member; Henry E. 
                            Brown, Jr., Committee Member; Jeff Miller, 
                            Ranking Republican Member, Subcommittee on 
                            Health; John Boozman, Ranking Republican 
                            Member, Subcommittee on Economic 
                            Opportunity; Ginny Brown-Waite, Ranking 
                            Republican Member, Subcommittee on 
                            Oversight & Investigations; Michael R. 
                            Turner, Committee Member; Brian P. Bilbray, 
                            Committee Member; Doug Lamborn, Ranking 
                            Republican Member, Subcommittee on 
                            Disability Assistance and Memorial Affairs; 
                            Gus M. Bilirakis, Committee Member; Vern 
                            Buchanan, Committee Member.

        REPUBLICAN VIEWS AND ESTIMATES FOR FISCAL YEAR (FY) 2009

                           February 28, 2008

                                OVERVIEW

    For veteran's healthcare and program costs in FY 2009, the 
Republican Members of the Committee on Veterans' Affairs 
recommend $3.831 billion above the Administration's request for 
discretionary spending in FY 2009. In addition, we recommend $2 
billion for a legislative initiative to modernize GI Bill 
education and training benefits for servicemembers of the 
Reserves and National Guard.

              UNITED STATES DEPARTMENT OF VETERANS AFFAIRS

                    Veterans Benefits Administration

                           MANDATORY FUNDING

    The Veterans Benefits Administration (VBA) administers a 
broad range of non-medical benefits to veterans, their 
dependents, and survivors through 57 regional offices. These 
programs include disability compensation, non service-connected 
pension, education, vocational rehabilitation, burial, 
insurance, and home loan guaranty.
    The Republican Members support the Administration's FY 2009 
budget request of $46.4 billion in mandatory funding for 
veterans' programs, a 3.5 percent increase over the enacted 
level for FY 2008, except for the additional $2 billion we 
recommend to modernize the GI Bill.

                         DISCRETIONARY FUNDING

    With the exception of the recommendations noted below, the 
Republican Members support the Administration's FY 2009 request 
of $1.371 billion in discretionary funding for the management 
of the benefits programs--disability compensation, pension, 
education, vocational rehabilitation and employment, housing, 
burial, and life insurance.
    Disability Compensation and Pension Service--The 
Administration requests $1.113 billion in budget authority to 
fund the discretionary portion of the disability compensation, 
pension, and burial programs. This includes administrative 
expenses for 12,120 Full Time Equivalent Employees (FTEE), an 
overall increase of 703 FTEE over the FY 2008 level. This 
increase includes an additional 694 Direct FTEE over the FY 
2008 level.
    For FY 2009, VBA projects receipt of 872,002 claims, an 
increase of 17,098 claims over FY 2008 levels. Though the 
accumulation of the claims backlog has slowed, the Republican 
Members remain concerned that VBA still has an inventory of 
over 400,000 claims. Of this inventory, 103,410 claims (or 25.8 
percent), have been pending over 180 days.
    VBA intends to address this large workload in three ways:
    First, VBA plans to enhance its use of information 
technology to help with claims processing. VBA plans to 
increase collaboration with the Department of Defense to obtain 
medical and discharge information electronically. VBA will also 
begin funding a paperless claims processing initiative (known 
as Virtual VA), which will reduce reliance on burdensome paper 
claims files. Additionally, VBA will utilize rules-based 
technology to help claims adjudicators make rating decisions in 
a more accurate and timely manner. VA has spent more than $600 
million over the past decade in an attempt to automate the 
compensation and pension (C&P) claims processing system. This 
complicated, paper-driven process is more than twenty-five 
years old.
    The Republican Members applaud this initiative, which 
reflects our long-held position favoring increased use of 
information technology, and recommend an additional $10 million 
to fund this initiative. This increase is reflected in our 
recommended increase in the Virtual VA account of the Office of 
Information and Technology.
    Second, VBA expects to reduce the backlog of claims by 
continuing to consolidate all original pension claims 
processing to three pension maintenance centers. This will take 
the burden of adjudicating pension claims off regional offices.
    Third, VBA expects to reduce the backlog by continuing to 
train and prepare the 2,900 direct FTEE that VBA plans to hire 
for C&P service by the end of FY 2009. This includes funding 
for 1,830 direct FTEE for C&P service that was appropriated 
with the contingent emergency funding in the Consolidated 
Omnibus Appropriations Act of 2008.
    All three of these are part of VBA's overall strategy to 
reduce the average processing time for C&P claims to 145 days. 
This would represent a thirty eight day (or 26 percent) 
improvement in processing timeliness from FY 2007, and a twenty 
seven day (or 18 percent) reduction in the amount of time 
required to process claims in FY 2008. The Republican Members 
believe that in order to realistically reach this strategic 
goal the C&P service will need additional FTEE and recommend an 
additional $31.2 million to fund an additional 300 FTEE for the 
C&P service.
    Since it takes new raters an average of up to two years 
before most C&P employees become fully productive, increased 
training of new hires is vital to reducing the backlog. 
Therefore, the Republican Members recommend an additional $8 
million for Training and Performance Support Systems, and an 
additional $2 million for skills certification. The Republican 
Members also recommend an additional $1.88 million to fund 20 
additional FTEE for VBA's National Training Academy in 
Baltimore, MD.
    The Republican Members recognize that additional direct 
compensation FTEE will not improve quality, accuracy, and 
timeliness in claims processing without corresponding increases 
in training resources.
          Intergovernmental Partnerships--The Republican 
        Members recommend $15 million for a pilot program to 
        explore the feasibility of intergovernmental 
        partnerships in the development of compensation and 
        pension claims between VA and municipal, county and 
        state veterans departments and service officers, as 
        well as veterans' and military service organizations. 
        This pilot program would also use information 
        technology to assist in the development and transmittal 
        of veterans claims to VA regional offices. We recommend 
        the pilot occur in three states: New York, Missouri, 
        and Wyoming, or other states with varied veteran 
        demographics. This expanded pilot would build on 
        findings from the 2002 intergovernmental pilot 
        conducted between the VA regional office in Buffalo and 
        the New York State Division of Veterans Affairs.
          Veterans Choice in Filing Pilot Program--The 
        Republican Members also recommend $5 million for a two-
        year pilot program where veterans who live in the 
        jurisdiction of VA regional offices in New York, NY; 
        Newark, NJ; Atlanta, GA; and Detroit, MI would be able 
        to submit their disability claims to any VA regional 
        office for adjudication. This pilot program would give 
        veterans a choice about where they would like to have 
        their claim adjudicated.
          Systematic Technical Accuracy Review (STAR) Reviews--
        STAR reviews are one of many ways that VBA reviews the 
        quality of their ratings decisions. Despite the recent 
        increase in the number of STAR reviews, the Republican 
        Members believe that too much emphasis is placed on the 
        number of claims decided by VBA instead of the quality 
        of decisions made. The Republican Members would rather 
        the adjudication of a disability claim take longer and 
        be right than not take as long and be wrong. The 
        Republican Members recommend $4 million to increase the 
        number of claims reviewed by STAR reviewers and 
        increase the amount of STAR staff training at regional 
        offices.
    Education Service--The Republican Members were pleased with 
the results of the pilot call center project during FY 2007 and 
understand VA intends to implement a permanent education call 
center in Muscogee, OK during FY 2008. They believe this 
project is vital to continuing the progress made in reducing 
the processing times for education claims. VBA estimates a 
workload increase of about 13,000 education claims, but the 
Administration requests only 23 additional direct support FTEE. 
As of February 11, 2008, the backlog of education claims was 
nearly 66,000, and average processing times for original and 
supplemental claims were 24 and 11 days respectively, with 
targets of 19 and 10 days. While this is an improvement over 
the previous year, it is insufficient to meet the needs of 
veterans. Passage of the FY 2008 National Defense Authorization 
Act included several provisions such as post-discharge use of 
chapter 1607 education benefits for members of the Guard and 
Reserves that will increase the workload of the Education 
Service.
    It is difficult to determine the exact magnitude of the 
increased workload due to those provisions and expanding 
participation in nearly all other education programs 
administered by VA. However, the continuing loss of experienced 
staff from retirements, increased workloads, staffing the call 
center and the pending backlog of claims convince the 
Republican Members that an additional 160 FTEE are needed for 
the Education Service with a projected discretionary cost of 
$12.32 million.
    Vocational Rehabilitation and Employment Service--With the 
continuing Global War on Terror producing large numbers of 
severely wounded service Members and the challenges entailed in 
rehabilitating those with multiple trauma including significant 
numbers of traumatic brain injury, the Republican Members are 
disappointed that the Administration did not request additional 
staff for the VR&E program. We applaud the Department's 
continuing efforts to realign functions and duties to allow 
counseling and employment staff to concentrate on increasing 
rehabilitation rates. However, we believe current average 
caseload, which now exceeds 130 per counselor nationally, 
should be not more than 100 per counselor to provide 
appropriate levels of service including oversight of cares 
served through contract counselors. Therefore, we recommend 
$13.5 million to fund an additional 150 professional level 
FTEE. The Republican Members also recommend an additional 
$18.02 million to contract for continued rehabilitation 
services for veterans.
    Loan Guaranty Service--The Republican Members recommend an 
additional 40 FTEE at a cost of $3.656 million to improve the 
percentage of loans transmitted through VA's Foreclosure 
Avoidance through Closing (FAC) system within the Loan Guaranty 
Service.
    VA-USOC Military Paralympic Program--This coming summer, 
America's Olympic and Paralympic teams will compete in the 
Beijing Olympics. In 2005, at the urging of then Chairman 
Buyer, VA signed a Memorandum of Understanding (MOU) with the 
US Olympic Committee (USOC) to begin a cooperative effort to 
increase disabled veteran participation in sports at all 
levels, including elite events such as the Paralympics.
    Over the three years since the MOU, the USOC has held a 
series of military sports summits for recently-injured veterans 
of the War on Terror, and VA has assisted by providing medical 
and recreational therapy staff and disabled veterans undergoing 
rehabilitation. As a result of this collaboration, as well as 
interest by the disabled veteran's community in general, it is 
possible that as many as eight disabled veterans will compete 
in Beijing.
    Competition at elite levels of athletic events requires 
significant dedication to training, especially for service-
disabled athletes. Therefore, we believe it is appropriate for 
VA to defray expenses for service-disabled athletes 
participating at elite levels in the program. We estimate the 
cost at $2 million per year. The Republican Members also 
recommend an additional $5 million to improve opportunities for 
these veterans to participate in sporting or other special 
events. To facilitate these opportunities the Republican 
Members recommend an additional $1.05 million to fund and 
additional 10 FTEE for the National Programs and Special 
Events.

                       Board of Veterans' Appeals

    The Administration requests $64.744 million to support 487 
FTEE for the Board of Veterans' Appeals (BVA), an increase of 
$2.475 million and 21 FTEE over FY 2008 level. The Republican 
Members recommend an additional $14.865 million to support an 
additional 113 FTEE for a total BVA staffing of 600 FTEE. The 
BVA provides independent reviews of VA regional office 
decisions and makes the final administrative decision on behalf 
of the Secretary of Veterans Affairs. While BVA has made 
improvements, it continues to experience difficulties meeting 
the production levels. We believe that additional staff is 
necessary if BVA is to provide timely and accurate decisions to 
veterans and their families. The Republican Members recommend 
$79.609 million for the BVA program account.

                    National Cemetery Administration

    The Administration requests $425 million in discretionary 
funding for the National Cemetery Administration (NCA). This 
includes $181 million for operations and maintenance of VA's 
national cemeteries and 1,603 FTEE, a decrease of $14 million 
and increase of 51 FTEE over the FY 2008 level. This also 
includes $25 million in minor construction to address cemetery 
infrastructure improvements. The administration also requested 
$6 million to create an advance planning account that will give 
NCA flexibility in purchasing land for future cemeteries.
          Cemetery Operations and Maintenance--The Republican 
        Members recommend an additional $19 million to the 
        Administration's request of $181 million for a total of 
        $200 million for NCA operations and maintenance, and an 
        additional $144 million for minor construction.
          NCA Major Construction and Gravesite Expansion--The 
        Republican Members recommend an additional $100 million 
        to accelerate VA's five-year strategic plan to fund 
        National Cemetery gravesite expansion. VA will inter an 
        estimated 111,000 veterans in 2009, with similar 
        projections for the near future, most from our 
        ``Greatest Generation.'' The Republican Members believe 
        accelerated expansions are an appropriate response to 
        assure veterans a final resting place in a national 
        shrine. Expansions funded in FY 2009 would include 
        National Cemeteries in Annville, PA, Fort Mitchell, AL, 
        Dayton, OH, Kent, WA, Triangle, VA, Houston, TX, 
        Elwood, IL, St. Louis, MO, Phoenix, AZ, and Riverside, 
        CA. The Republican Members also recommend an additional 
        $100 million to fund the construction of additional 
        columbarium space for veteran internments in populated 
        areas.
          National Shrine Commitment--The Republican Members 
        also recommend an additional $300 million to complete 
        the NCA's National Shrine Commitment. The funding from 
        the commitment would be used on infrastructure projects 
        such as irrigation improvements, renovation of historic 
        structures, and road resurfacing. This additional 
        funding would be part of the NCA's major construction 
        account. The total funding for the NCA major 
        construction account recommended by the Republican 
        Members is $610 million which is $500 million above the 
        administration's request.
          Grants for the Construction of State Cemeteries--The 
        Republican Members also recommend an additional $10 
        million for grants for the construction of state 
        cemeteries for a total of $42 million. This program 
        gives funding to states to build national cemeteries 
        and requires that the state then pay all operation and 
        maintenance costs once the cemetery is built. This 
        program continues to have a waiting list and additional 
        funding would provide better access to veterans 
        cemeteries for veterans and their families.

                     Veterans Health Administration

    For FY 2009, the Administration requests $41.2 billion in 
appropriations for discretionary spending on veterans' medical 
care, an increase of $2 billion or 5.4 percent over the FY 2008 
appropriated level.
    Medical Services--The Administration requests $34.1 billion 
for medical services. In the FY 2009 request, VA merged the 
medical services and medical administration appropriation 
accounts. VA argues that merging these two accounts will 
improve the budget execution and allow VA to respond rapidly to 
unanticipated changes in the health care environment throughout 
the year.
    The Republican Members recommend $35.2 billion for medical 
services which is $1.137 billion above the Administration's 
request. This increase is recommended as follows:
          Operation Iraqi Freedom and Operation Enduring 
        Freedom (OIF/OEF)--We recommend a $50 million increase 
        to account for the enactment of Public Law 110-181 that 
        extends the period during which combat veterans can 
        receive care in priority category 6 from two to five 
        years from their date of discharge, and provides for 
        multiple requirements for wounded warrior assistance 
        programs. The Administration requests $1.267 billion to 
        meet the needs of veterans from OIF/OEF, an increase of 
        $216 million, or 21 percent from expected costs for FY 
        2008. The Republican recommendation would bring funding 
        to $1.317 billion for OIF/OEF veterans;
          Traumatic Brain Injury (TBI)--We recommend a $50 
        million increase to support the care of our wounded 
        warriors with TBI and the needs of their family 
        caregivers. VA should establish a centralized policy 
        and procedures to ensure that best practices for both 
        short and long-term TBI rehabilitation are rapidly 
        disseminated and adopted throughout the VA system.
          Rural Health Care--We recommend a $200 million 
        increase to improve the access and quality of care for 
        enrolled veterans residing in rural areas. This 
        includes additional funding for the Office of Rural 
        Health and improving access to care by utilizing 
        existing non-VA rural health infrastructure;
          Dental Care--We recommend a $100 million increase to 
        provide dental care for the increasing number of 
        returning OIF/OEF servicemembers accessing VA for 
        dental care. Many OIF/OEF active duty, Guard, and 
        Reserve servicemembers are returning with serious 
        dental problems and are not receiving corrective dental 
        care prior to separation from active duty. VA is then 
        obligated to treat these separated servicemembers, 
        often through costly contract care. Although we include 
        this additional funding, we also anticipate enacting 
        legislation that would require VA to seek reimbursement 
        from DoD for the post-deployment dental care VA is 
        providing;
          Health Professional Educational Assistance Program--
        We recommend a $50 million increase to provide 
        scholarships to employees pursing degrees or training 
        in health care disciplines for which recruitment and 
        retention of qualified personnel is difficult. We 
        expect this additional funding to include support for 
        the recruitment and retention of staff to provide 
        mental health care in rural settings;
          Mental Health Care--We recommend a $213 million 
        increase for VA to continue to implement the Mental 
        Health Strategic Plan and to enhance efforts to 
        identify and respond to mental health problems of 
        returning OIF/OEF service members, including members of 
        the National Guard and Reserve;
          Emergency Care--We recommend a $50 million increase 
        to reimburse certain veterans enrolled in VA health 
        care without a service-connected disability for the 
        cost of emergency treatment received in a non-VA 
        facility until such time as such veterans are 
        transferred to a VA facility;
          Medical Patient Workload--We recommend a $100 million 
        increase to provide timely and accessible high-quality 
        health care to core constituency veterans--the service-
        connected disabled, injured and indigent;
          Prosthetic and Sensory Aids--We recommend a $50 
        million increase to cover the increased costs of 
        providing, repairing and replacing prosthetics and 
        sensory aids;
          Long-term care--We recommend a $200 million increase 
        to support long-term care services;
          Medical Care Collections Fund--We recommend a $74 
        million increase in medical services, as we remain 
        concerned that VA cannot meet its estimated collections 
        goal.
    Medical Facilities--We recommend a $400 million increase 
above the Administration's request of $4.661 billion for 
necessary costs associated with operating and maintaining VA's 
health care system infrastructure.
    Medical and Prosthetic Research--The Administration 
requests $442 million in appropriations for medical and 
prosthetic research, a decrease of $38 million below the FY 
2008 appropriated level. We place a high premium on conducting 
research into injuries and illnesses related to military 
service that benefit the clinical treatment needs of veterans. 
While the Department intends to place additional reliance on 
outside federal grants to realize a net gain in research 
funding, we recommend an $83 million increase above the 
Administration's request for a total of $525 million for this 
program account.
    Legislative Proposals--The Administration includes seven 
new legislative proposals as well as legislative policy 
proposals from last year. The Republican Members support the 
seven new health legislative proposals that would: exempt co-
payments from all hospice care provided through VA from co-
payments; allow VA to pay for specialized residential care and 
rehabilitation for OEF/OIF veterans in medical foster homes; 
update HIV testing policy; provide permanent authority for IRS 
income data matching for VA eligibility determinations; 
authorize VA to release certain health information to secure 
third-party reimbursement for care provided by VA; allow ``in-
lieu-of'' reimbursement for certain continuing medical 
education; and extend the application time for post discharge 
dental benefits from 90 to 180 days. (The extension of dental 
benefits has already been enacted in Public Law 110-181.)
    The Republican Members continue to reject the three policy 
proposals that would: allow VA to establish a tiered annual 
enrollment fee for priority groups 7 and 8 veterans based on 
family income; increase pharmacy co-payments for priority 
groups 7 and 8 veteran from $8 to $15 dollars; and eliminate 
the practice of offsetting or reducing VA first-party co-
payment debts with collection recoveries from third-party 
health plans. These proposals do not reduce the 
Administration's request for discretionary medical care 
appropriations. The additional revenue would be classified as 
mandatory receipts to the Treasury and would not be retained in 
VA for veterans' health care programs.
    VHA Major Construction Projects--The Administration 
requests $471.5 million for VHA major construction projects. We 
recommend a $752 million increase above the Administration's 
request. This increase includes funding to cover increased 
costs of construction and increased funding for the advanced 
planning fund for developing the design of major construction 
projects including public-private ventures to support the 
future demand for health care services. This would bring the 
total to $1.224 billion for this program account or $752 
million above the Administration's request.
    VHA Minor Construction Projects--The Administration 
requests $273.418 million for VHA minor construction projects 
and the Republican Members recommend a $200 million increase 
over the Administration's request, for a total of $473.418 for 
this account.
    Grants for Construction of State Extended Care Facilities--
The Administration requests $85 million in appropriations for 
grants for the construction of state extended care facilities, 
the same amount as the FY 2008 appropriated level. The 
partnership between the federal government and the states is a 
long-standing and honored tradition of cost sharing. We 
recommend a $90 million increase above the Administration's 
request for a total of $175 million for this account.

                  Office of Information and Technology

    The Republican Members concur with the Administration's 
request for $2.442 billion for the Office of Information and 
Technology (OI&T). This should be the last year for 
appropriations for VETSNET application development. Any further 
funding should be for code-conversion and operations and 
maintenance.
    Additionally, the Committee recognizes the value of 
programs designed to reduce the backlog of claims, and provide 
improved services to veterans. Therefore, we recommend an 
additional funding amount of $10 million for Virtual VA.
    The Republican Members also recommend an additional $100 
million for 915 FTEE to provide for information technology 
services at all VA locations nationwide, and an additional $200 
million to be used to consolidate the multiple infrastructures 
presently in existence at the VA. Without a significant 
injection of funds to consolidate, the VA will spend at least 
10 years to slowly combine these multiple infrastructures into 
one. The Republican Members also believe in encouraging IT 
innovation at the outlying VA facilities, and therefore 
recommend an additional $16 million for field innovation in 
order to continue a program started in FY 2008 by the Office of 
Information and Technology.
    The Republican Members recommend reducing funding to The 
Education Expert System (TEES) in the amount of $5.259 million 
until the VA can articulate a measurable performance outcome 
for the program for FY 2009.
    The total recommended amount for the Office of Information 
and Technology is $2.762 billion, which is $320 million above 
the Administration's request.

                    Office of the Inspector General

    The VA Office of Inspector General (OIG) is responsible for 
the audit, investigation, and inspection of all VA programs and 
operations. For FY 2009, the Administration request $76.5 
million and 440 FTEE to support the activities of the OIG. This 
compares with the FY 2008 request of $72.6 million for 
administrative expenses and 445 FTEE. However, this FY 2009 
funding level would result in a reduction of 48 FTEE from 
current staffing levels. In order to maintain the current level 
of audits, inspections, and investigations completed, as well 
as the monetary benefits identified, Congress would need to 
provide funding of $84.9 million (a $8.4 million increase over 
the Administration request). Major audits, reviews and 
investigations would have to be cancelled should this reduction 
in staffing occur. During FY 2007, OIG identified over $670.2 
million in monetary benefits, for a return of $11 for every 
dollar expended on OIG oversight. The Republican Members 
recommend adding $8.9 million in FY 2009, in order to provide 
for a total of 540 FTEE at a cost of $93.8 million.
    Additionally, the Republican Members recognize the 
importance of forward looking initiatives and investigations 
provided by the OIG. Therefore, the Republican Members also 
recommend an additional increase in funding to the OIG by $17.3 
million for the following initiatives: $10.3 million and 60 
FTEE for DoD/VA Transitional Health Care; $3.5 million and 20 
FTEE for information technology security; and $3.5 million and 
20 FTEE for acquisition reform. The total funding for the OIG 
account recommended by the Republican Members is $111.1 million 
which is $34.6 million above the Administration's request.

                       General Operating Expenses

    The Republican Members recommend an additional $1.03 
million be made available to fund an additional 10 FTEE to 
improve timeliness and customer service at the VA Office of 
Congressional and Legislative Affairs. The Republican Members 
also recommend an additional 19 FTEE at a cost of $2.09 million 
for the Center on Veterans Employment to improve implementation 
of the service disabled veteran-owned small business provisions 
in P.L. 109-461. The Republican Members further recommend an 
additional 10 FTEE for the Office of Small and Disadvantaged 
Business Utilization to improve small business procurement 
opportunities within VA at a cost of $1.1 million. These 
increases combined with other general operating expenses from 
VBA bring the Republican Member recommendation for general 
operating expenses to $1.841 billion, which is $142 million 
above the Administration's request.

 UNITED STATES DEPARTMENT OF LABOR--VETERANS' EMPLOYMENT AND TRAINING 
                                SERVICE

    Homeless Veterans Reintegration Program (HVRP)--The 
Republican Members are pleased with the increase in HVRP 
funding that will allow VETS to contract with an additional 7 
grantees. The program has been cited by GAO as the most cost-
effective employment program for the homeless, placing 65 
percent of homeless veterans with an average cost per placement 
of about $2,400. We recommend an additional $1 million to bring 
the total number of potential new grantees to 10.
    National Veterans Training Institute--In Public Law 109-
461, Congress mandated several changes in the state grant 
program that will require greater training capacity at the 
National Veterans Training Institute in Denver, CO. The 
Committee recommends an additional $2 million to fund increased 
NVTI operations.
    USERRA Training and Enforcement--The Veterans Employment 
and Training Service has primary responsibility for enforcing 
veterans' employment and reemployment rights under USERRA. Case 
loads are climbing and additional resources are required to 
ensure timely resolution of USERRA-related cases. Therefore, we 
recommend an additional $1 million to fund six additional 
professional investigators.
    State Grants for DVOPS and LVERs & the Transitional 
Assistance Program--The Republican Members are concerned that 
the small increases over the past few years have resulted in a 
gradual reduction in state veterans' employment staff while 
demands related to the Transition Assistance Program (TAP) 
continue to increase. The economic downturn will also result in 
more veterans seeking employment. Therefore, we recommend an 
additional $1.5 million.

                          PROPOSED LEGISLATION

    GI Bill--During the 109th Congress, the Economic 
Opportunity Subcommittee conducted a series of hearings and 
site visits to determine the need to modernize the Montgomery 
GI Bill (MGIB) for both active duty and members of the Selected 
Reserve. MGIB benefit levels for active duty members have not 
nearly kept pace with the increasing cost of higher education, 
and extensive utilization of the Reserve Components in the 
Global War on Terror justifies increases in the basic levels of 
their benefits. Therefore, we propose an additional $2 billion 
in mandatory spending to improve education benefits. This 
includes indexing the basic payment at 100 percent of the 
Department of Education average four year public school cost.
    Disability Benefits Reform Bill--The Republican Members 
propose legislation that will implement disability compensation 
reform for VA and the Department of Defense. The bill is based 
on some of the recommendations of the President's Commission on 
Care of America's Returning Wounded Warriors, also known as the 
Dole-Shalala Commission and the Veterans Disability Benefits 
Commission. Our proposal would end dual disability systems run 
by the Department of Defense (DOD) and Department of Veterans 
Affairs (VA). Currently, servicemembers who are medically 
separated receive a physical evaluation and disability rating 
from their respective branch of service and then typically go 
to the VA for another physical and disability rating based on 
service-related conditions. Our proposal would use a single 
examination and rating, and take DOD out of the disability 
rating business altogether. Those deemed unfit for service due 
to injury would receive an annuity from DOD based on rank and 
years of service. VA would conduct a study to determine 
appropriate amounts of compensation under a new, modern 
disability compensation rating schedule. The new schedule would 
reflect average loss of earning capacity and loss of quality of 
life due to disability.
    Comprehensive Heath and Benefit Improvements--The 
Republican Members recognize that improvements need to be made 
in a variety of VA programs so that they meet the emerging 
needs of both newly returning veterans from recent conflicts 
and our aging veterans from previous wars. Therefore, the 
Republican Members plan to introduce comprehensive legislation 
that will address a variety issues facing the VA, including a 
proposal to provide dental insurance to eligible veterans and 
expanding contract care for rural veterans. Other proposals 
will include, increased funding for adaptive housing and auto 
grants, and make adjustments to the Home Loan Guarantee program 
to bring it in line with current market conditions. In 
addition, the legislation will address the current claims 
backlog by increasing training for veteran's service officers, 
establishing a paperless and rules-based adjudication system, 
and establishing a pilot program to give veterans a choice of 
where they file their claims. Finally, the proposed legislation 
will increase the burial plot allowance for veterans.

            SUPPLEMENTAL VIEWS OF THE HONORABLE STEVE BUYER

                    VIEWS AND ESTIMATES FOR FY 2009

                           February 28, 2008

    The Administration's requested FY 2009 budget for veterans' 
programs includes legislative proposals to change the 
Department of Veterans Affairs (VA) fee structure for health 
care. These proposals for certain fees and co-payments are more 
fully described in the Republican Views and Estimates for FY 
2009. According to the legislative proposals, the revenue 
generated by these fees and co-payments would be mandatory 
receipts to be deposited in the U.S. Treasury, rather than 
retained by the VA for the benefit of veterans.
    The Administration proposes including fees and co-payments 
related to enrollment of category 7 and 8 veterans in VA 
medical care. Tiered enrollment fees would range from $250 per 
year for a veteran with an income of $50,000 to $750 per year 
for a veteran with an income of $100,000 or greater. Copayments 
for pharmaceuticals would rise from the current $8 to a new 
level of $15 per 30-day supply. VA would also be authorized to 
discontinue the current practice of offsetting or reducing a 
patient's first party co-payment debt from funds received from 
third-party insurance for non service-connected treatment. I 
would only support these initiatives to generate $378.7 million 
in the first year and $5.204 billion over 10 years, if the 
revenues generated were retained by the VA for its veterans' 
health care programs.

                                  
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