National Cemetery System: Plans for Addressing Projected Increases in
Veterans' Burials (Testimony, 04/29/98, GAO/T-HEHS-98-157).

GAO discussed the National Cemetery System's (NCS) plans to accommodate
the increasing demand for burial benefits and what it can do to extend
the service period of existing cemeteries.

GAO noted that: (1) NCS has adopted a 5-year strategic plan for fiscal
years 1998 through 2003 with the goal of ensuring that burial in a
national or state veterans' cemetery is an available option for all
veterans and their eligible family members; (2) strategies outlined in
NCS' plan include: (a) building new national cemeteries; (b) expanding
existing cemeteries; and (c) encouraging states to provide additional
burial sites through participation in the State Cemetery Grants Program;
(3) however, it is unclear how NCS will address the veterans' burial
demand during the peak years, when pressure on it will be greatest,
since NCS' strategic plan does not indicate how it will begin to
position itself to handle the increasing demand for burial benefits; (4)
NCS officials stated that beyond 2003, NCS will continue using the basic
strategies contained in its current 5-year plan; (5) for example, NCS
plans to encourage states to establish veterans' cemeteries in areas
where it does not plan to operate national cemeteries; (6) however,
since the grant program's inception in 1978, fewer than half of the
states have established veterans' cemeteries; (7) states have also shown
limited interest in a legislative proposal designed to increase state
participation by increasing the share of federal funding; (8) given the
magnitude of the projected increase in demand for burial benefits, GAO
continues to believe that it is important for NCS to articulate to
Congress and other stakeholders how it plans to address the increasing
demand; (9) as annual interments increase, cemeteries reach their burial
capacity, thus increasing the importance of making the most efficient
use of available cemetery space; (10) to identify feasible approaches to
extending the service period of existing cemeteries, GAO analyzed the
impact of adding burial sites to an acre of land in an existing
cemetery; (11) GAO's analysis of three interment options showed that
columbaria offered the most efficient option because they would involve
the lowest average interment cost and would significantly extend a
cemetery's service period; and (12) morever, while the majority of
veterans and eligible family members prefer a casket burial, cremation
is an acceptable interment option for many, and the demand for
cremation, which varies by region, continues to increase.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  T-HEHS-98-157
     TITLE:  National Cemetery System: Plans for Addressing Projected 
             Increases in Veterans' Burials
      DATE:  04/29/98
   SUBJECT:  Veterans
             Veterans benefits
             Agency missions
             Strategic planning
             Cost control
             Grants to states
             Cost sharing (finance)
IDENTIFIER:  VA National Cemetery System
             State Cemetery Grant
             
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Cover
================================================================ COVER


Before the Subcommittee on Benefits, Committee on Veterans' Affairs,
House of Representatives

For Release on Delivery
Expected at 10:00 a.m.
Wednesday, April 29, 1998

NATIONAL CEMETERY SYSTEM - PLANS
FOR ADDRESSING PROJECTED INCREASES
IN VETERANS' BURIALS

Statement of Stephen P.  Backhus, Director
Veterans' Affairs and Military Health Care Issues
Health, Education, and Human Services Division

GAO/T-HEHS-98-157

GAO/HEHS-98-157T


(105766)


Abbreviations
=============================================================== ABBREV

  NCS - National Cemetery System
  VA - Department of Veterans Affairs

NATIONAL CEMETERY SYSTEM:  PLANS
FOR ADDRESSING PROJECTED INCREASES
IN VETERANS' BURIALS
==================================================== Chapter Statement

Mr.  Chairman and Members of the Subcommittee: 

We are pleased to be here today to discuss the National Cemetery
System's (NCS) plans to accommodate the increasing demand for burial
benefits.  NCS of the Department of Veterans Affairs (VA) provides
interment of eligible veterans and their families upon demand in
national cemeteries.  In fiscal year 1997, NCS provided burial
benefits to about 73,000 veterans and their family members and had an
appropriation of about $77 million for interments and related program
services.\1

With the aging of World War II veterans, the numbers of veteran
deaths and interments performed by NCS continue to grow each year and
are expected to peak between 2005 and 2010.  NCS projects annual
interments will increase over 40 percent between 1995 and 2010,
peaking at about 107,000 in 2008.  In addition, because of the
depletion of available grave sites, over half of the national
cemeteries currently are unable to accommodate casket burials of
"first family members."\2 NCS projects that 15 additional cemeteries
will deplete their inventory of casket grave sites for first family
members by 2010.  Therefore, it is important that NCS articulate how
it will begin to position itself to handle this increase in demand
for burial benefits. 

My statement today will focus on NCS' plans for addressing the
increasing demand for burial benefits and what it can do to extend
the service period of existing cemeteries.  The information in this
statement is based on our September 1997 report on these topics, as
well as recent discussions with NCS officials.\3

In summary, NCS has adopted a 5-year strategic plan for fiscal years
1998 through 2003 with the goal of ensuring that burial in a national
or state veterans' cemetery is an available option for all veterans
and their eligible family members.  Strategies outlined in NCS' plan
include (1) building new national cemeteries, (2) expanding existing
cemeteries, and (3) encouraging states to provide additional burial
sites through participation in the State Cemetery Grants Program. 
However, it is unclear how NCS will address the veterans' burial
demand during the peak years (2005 through 2010), when pressure on it
will be greatest, since NCS' strategic plan does not indicate how it
will begin to position itself to handle the increasing demand for
burial benefits.  NCS officials told us that beyond 2003, NCS will
continue using the basic strategies contained in its current 5-year
plan.  For example, NCS plans to encourage states to establish
veterans' cemeteries in areas where it does not plan to operate
national cemeteries.  However, since the grant program's inception in
1978, fewer than half of the states have established veterans'
cemeteries.  States have also shown limited interest in a legislative
proposal designed to increase state participation by increasing the
share of federal funding.  Although we recommended in our September
1997 report that NCS address in its strategic plan veterans'
long-term burial demand during the peak years, NCS officials
contended that the strategic plan should cover only a 5-year period
through 2003 to conform with VA's strategic planning process.  Given
the magnitude of the projected increase in demand for burial
benefits, we continue to believe that it is important for NCS to
articulate to the Congress and other stakeholders how it plans to
address the increasing demand. 

As annual interments increase, cemeteries reach their burial
capacity, thus increasing the importance of making the most efficient
use of available cemetery space.  To identify feasible approaches to
extending the service period of existing cemeteries, we analyzed the
impact of adding burial sites to an acre of land in an existing
cemetery.\4 Our analysis of three interment options showed that
columbaria offered the most efficient option because they would
involve the lowest average interment cost and would significantly
extend a cemetery's service period.\5 Moreover, while the majority of
veterans and eligible family members prefer a casket burial,
cremation is an acceptable interment option for many, and the demand
for cremation, which varies by region, continues to increase.  NCS
concurred with the recommendations in our September 1997 report to
identify opportunities to construct columbaria in existing cemeteries
and to collect and use information on veterans' burial preferences to
better plan for future burial needs.  NCS plans to collect such data
in its next Survey of Veterans around the year 2000. 


--------------------
\1 In addition to burying eligible veterans, NCS manages three
related programs:  Headstones and Markers; Presidential Memorial
Certificates; and State Cemetery Grants, which provides financial aid
to states establishing, expanding, or improving state veterans'
cemeteries. 

\2 Currently, veterans who choose casket burial are allotted one plot
that can hold two caskets, one above the other.  The first eligible
family member who dies and is buried in such a plot, which may or may
not be the veteran, is called the first family member; the second
family member who dies and is buried in such a plot is called the
subsequent family member. 

\3 National Cemetery System:  Opportunities to Expand Cemeteries'
Capacities (GAO/HEHS-97-192, Sept.  10, 1997). 

\4 We assumed an acre of land composed of parcels of land that are
not contiguous. 

\5 The three interment options analyzed were casket burial, in-ground
interment of cremated remains, and interment of cremated remains in
columbarium niches, which are recessed compartments within a
structure--called a columbarium--that hold cremation urns. 


   BACKGROUND
-------------------------------------------------- Chapter Statement:1

The National Cemeteries Act of 1973 (P.L.  93-43) authorized NCS to
bury eligible veterans and their family members in national
cemeteries.  Before 1973, all national cemeteries were operated under
the authority of the Department of the Army.  However, P.L.  93-43
shifted authority to VA for all national cemeteries except Arlington
National Cemetery and the U.S.  Soldiers' and Airmen's Home National
Cemetery. 

NCS operates and maintains 115 national cemeteries located in 39
states and Puerto Rico.  NCS offers veterans and their eligible
family members the options of casket interment and interment of
cremated remains in the ground (at most cemeteries) or in columbaria
niches (at nine cemeteries).  NCS determines the number and type of
interment options available at each of its national cemeteries.  The
standard size of casket grave sites, the most common burial choice,
is 5 feet by 10 feet, and the grave sites are prepared to accommodate
two caskets stacked one on top of the other.  A standard in-ground
cremains site is 3 feet by 3 feet and can generally accommodate one
or two urns.  The standard columbarium niche used in national
cemeteries is 10 inches wide, 15 inches high, and 20 inches deep. 
Niches are generally arrayed side by side, four units high, and can
hold two or more urns, depending on urn size. 

In addition to burying eligible veterans and their families, NCS
manages the State Cemetery Grants Program, which provides aid to
states in establishing, expanding, or improving state veterans'
cemeteries.  State veterans' cemeteries supplement the burial service
provided by NCS.  The cemeteries are operated and permanently
maintained by the states.  A State Cemetery grant may not exceed 50
percent of the total value of the land and the cost of improvements. 
The remaining amount must be contributed by the state.  The State
Cemetery Grants Program funded the establishment of 28 veterans'
cemeteries, including 3 cemeteries currently under development,
located in 21 states, Saipan, and Guam.  The program has also
provided grants to state veterans' cemeteries for expansion and
improvement efforts. 


   NCS HAS STRATEGIC PLAN FOR
   ADDRESSING BURIAL DEMAND, BUT
   PLANS BEYOND 2003 ARE UNCLEAR
-------------------------------------------------- Chapter Statement:2

As the veteran population ages, NCS projects the demand for burial
benefits to increase.  NCS has a strategic plan for addressing the
demand for veterans' burials up to fiscal year 2003, but the plan
does not address longer term burial needs--that is, the demand for
benefits during the expected peak years of veteran deaths, when
pressure on the system will be greatest.  Beyond the year 2003, NCS
officials said they will continue using the basic strategies
contained in the current 5-year plan. 


      FIVE-YEAR PLAN HAS MULTIPLE
      STRATEGIES
------------------------------------------------ Chapter Statement:2.1

According to its 5-year strategic plan (1998-2003), one of NCS'
primary goals is to ensure that burial in an open national or state
veterans' cemetery is an available option for all eligible veterans
and their family members.  The plan sets forth three specific
strategies for achieving this goal.  First, NCS plans to build, when
feasible, new national cemeteries.  NCS is in various stages of
establishing four new national cemeteries and projects that all will
be operational by the year 2000.\6

A second strategy for addressing the demand for veteran burials is
through expansion of existing cemeteries.  NCS plans to complete
construction in order to make additional grave sites or columbaria
available for burials at 24 national cemeteries.  NCS also plans to
acquire land needed for cemeteries to continue to provide service at
10 cemeteries. 

Third, NCS plans to encourage states to provide additional grave
sites for veterans through participation in the State Cemetery Grants
Program.  According to the plan, NCS plans to increase the number of
veterans served by a state veterans' cemetery by 35,000 per year
beginning in fiscal year 1998.\7 Also, NCS is in the early stages of
developing information designed to assist states in the establishment
of a state veterans' cemetery. 

Despite NCS plans to ensure that burial in a national or state
veterans' cemetery is an available option, officials acknowledge that
large numbers of veterans do not have access to a veterans' cemetery
within a reasonable distance of their place of residence.\8 For
example, NCS estimated that of the approximately 26 million veterans
in 1996, about 9 million (35 percent) did not have reasonable access
to a national or state veterans' cemetery.  According to NCS
officials, the majority of areas not served were major metropolitan
regions with a high concentration of veterans.  With the completion
of the four new cemeteries, NCS officials estimate that the
percentage of veterans who will have reasonable access to a veterans'
cemetery will increase from about 65 percent in fiscal year 1996 to
about 80 percent in fiscal year 2003.  However, NCS is unable to
specify the extent to which veterans will have access to a national
or state veterans' cemetery during the peak years.  NCS' estimates of
the percentage of veterans who will have access to a veterans'
cemetery stop at the year 2003. 


--------------------
\6 New national cemeteries will be located in or near Albany, New
York; Chicago, Illinois; Cleveland, Ohio; and Dallas-Fort Worth,
Texas. 

\7 In November 1997, New Hampshire opened a state veterans' cemetery
that is expected to serve about 131,000 veterans. 

\8 According to NCS, a national or state veterans' cemetery within 75
miles of a veteran's place of residence would provide reasonable
access. 


      NCS PLANS TO ADDRESS BURIAL
      DEMAND BEYOND THE YEAR 2003
      ARE UNCLEAR
------------------------------------------------ Chapter Statement:2.2

Although NCS has a 5-year strategic plan for addressing the demand
for veterans' burials during fiscal years 1998 through 2003, plans to
address the demand beyond 2003 are unclear.  For example, NCS'
strategic plan does not articulate how NCS will mitigate the effects
of the increasing demand for burial services.  According to NCS'
Chief of Planning, although its strategic plan does not address
long-term burial needs, NCS is always looking for opportunities to
acquire land to extend the service period of national cemeteries. 
Also, to help address long-range issues, NCS compiles key
information, such as mortality rates, number of projected interments
and cemetery closures, locations most in need of veterans'
cemeteries, and cemetery-specific burial layout plans. 

In addition, NCS officials pointed out that the Government
Performance and Results Act of 1993 (the Results Act) requires a
strategic plan to cover a 5-year period.\9 However, the Results Act
requires that an agency prepare a strategic plan that covers at least
a 5-year period and allows an agency to articulate how it plans to
address future goals.  For example, the National Aeronautics and
Space Administration's plan articulates a "strategic roadmap" that
outlines agencywide goals.  This roadmap lists separate goals for
near-, mid-, and long-term time periods over the next 25 years and
beyond.  The Environmental Protection Agency's plan also articulates
goals that are not bound by the 5-year time period.  For example, it
includes an objective to reduce toxic air emissions by 75 percent in
2010 from 1993 levels.  Although NCS projects annual interments to
increase about 42 percent from 73,000 in 1995 to 104,000 in 2010,
peaking at 107,000 in 2008, its strategic plan does not indicate how
the agency will begin to position itself to handle this increase in
demand for burial benefits.  We believe that, given the magnitude of
the projected increase in demand for burial benefits, NCS' strategic
plan should discuss how its current strategies will be adjusted to
address the demand during the peak years of veterans' deaths. 

While NCS' strategic plan does not address veterans' burial demand
beyond the year 2003, NCS officials said they will continue using the
basic strategies contained in the current 5-year plan.  For example,
NCS plans to enhance its relationship with states to establish state
veterans' cemeteries through the State Cemetery Grants Program. 
According to NCS' Chief of Planning, NCS will encourage states to
locate cemeteries in areas where it does not plan to operate and
maintain national cemeteries.  Since the State Cemetery Grants
Program's inception in 1978, fewer than half of the states have
established veterans' cemeteries, primarily because, according to NCS
officials, states must provide up to half of the funds needed to
establish, expand, or improve a cemetery as well as pay for all
equipment and annual operating costs.\10 Furthermore, the Director of
the State Cemetery Grants Program told us that few states, especially
those with large veteran populations, have shown interest in
legislation that VA proposed in its 1998 and 1999 budget submission
in order to increase state participation.  This proposed legislation
would increase the federal share of construction costs from 50 to 100
percent and permit federal funding for up to 100 percent of initial
equipment costs.  In fact, according to the Director, state veterans'
affairs officials said they would rather have funding for operating
costs than for construction. 

NCS officials told us they will continue to evaluate locations for
additional national cemeteries in the future, based on demographic
needs.  However, according to NCS officials, VA currently has no
plans to request construction funds for more than the four new
cemeteries, which will be completed by the year 2000.  Officials said
that even with the new cemeteries, interment in a national or state
veterans' cemetery will not be "readily accessible" to all eligible
veterans and their family members.  According to NCS officials, the
majority of areas not served will be major metropolitan areas with
high concentrations of veterans, such as Atlanta, Georgia; Detroit,
Michigan; and Miami, Florida. 


--------------------
\9 The Results Act requires agencies to clearly define their
missions, set goals, measure performance, and report on their
accomplishments. 

\10 NCS officials told us the costs of state veterans' cemeteries
range from about $125,000 to over $11 million, depending on size and
location.  NCS could not provide an estimate of the range of
operating costs of state veterans' cemeteries. 


   COLUMBARIUM OPTION OFFERS
   OPPORTUNITY FOR EXTENDING
   SERVICE PERIOD OF EXISTING
   CEMETERIES
-------------------------------------------------- Chapter Statement:3

As existing national cemeteries reach their capacity, columbarium
interment offers the most efficient option for extending cemetery
service periods.  We developed a model to analyze the cost of three
interment options on the basis of the cost of developing a total of 1
acre of land, composed of noncontiguous parcels of land, in a
cemetery nearing its limit of available casket grave sites.\11 The
analysis showed that the average burial cost would be lowest using
columbarium interment.  For example, the average columbarium
interment cost would be about $280, compared with about $345 for
in-ground cremains burial and about $655 for casket burial.  Our
analysis also showed that the service delivery period would be
extended the most using columbarium interment.  For example, using
columbarium interment in a total of 1 acre of land could extend the
service delivery period by about 50 years, while in-ground cremains
interment would extend the service period about 3 years and casket
burials about half a year.\12

While historical data imply that the majority of veterans and
eligible dependents prefer a casket burial, NCS national data show
that the demand for cremation at national cemeteries is
increasing.\13 For example, veterans choosing cremation increased
about 50 percent between 1990 and 1996, and NCS officials expect
demand for cremation to continue to increase in the future.\14 The
incidence of cremation also continues to increase in the general
population.  The Cremation Association of North America projects that
cremation will account for about 40 percent of all burials by 2010. 


--------------------
\11 We calculated the average cost per burial in present value terms. 
"Present value" is defined as the current worth of money expected to
be spent at a future date.  See app.  I of our report entitled
National Cemetery System:  Opportunities to Expand Cemeteries'
Capacities (GAO/HEHS-97-192, Sept.  10, 1997) for a detailed
discussion of the methodology and data used in the cost analysis. 

\12 NCS concurred with the recommendation in our September 1997
report to identify opportunities to construct columbaria in existing
cemeteries for the purpose of increasing burial capacity and
extending the cemeteries' service periods. 

\13 NCS concurred with the recommendation in our September 1997
report that additional data on veterans' preferences would assist
them in developing plans to provide burial options.  NCS officials
told us they plan to include questions pertaining to personal burial
preferences in NCS' next Survey of Veterans, which is planned around
the year 2000. 

\14 According to NCS officials, this percentage may be inflated
because some cemeteries offer only cremation interments. 


   CONCLUSION
-------------------------------------------------- Chapter Statement:4

Long-range planning is crucial to addressing veterans' burial needs
during the peak years and beyond.  Although NCS projects annual
interments will increase over 40 percent between 1995 and 2010, NCS'
current strategic plan does not indicate how it will begin to
position itself to handle this increase in demand for burial
benefits.  Given the magnitude of this projected change, we continue
to believe that NCS' plan should articulate how its strategies,
goals, and objectives will address veterans' burial needs during the
peak years, when the demand for burial benefits will be greatest. 
While the veteran population is entering its peak years of need, many
national cemeteries are depleting their inventory of available grave
sites.  As a result, additional burial sites are needed to help meet
future burial demand.  In some cases, state veterans' cemeteries
could reduce the negative impact of the loss of burial spaces from a
national cemetery.  However, fewer than half of the states have
established veterans' cemeteries, and states have shown limited
interest in a legislative proposal designed to increase state
participation by increasing the share of federal funding.  Therefore,
NCS needs to rely more on extending the service periods of its
existing cemeteries.  Columbaria can more efficiently utilize
available cemetery land at a lower average interment cost than the
other interment options and can also extend the service period of
existing national cemeteries.  Using columbaria also adds to
veterans' choice of services and recognizes current burial trends. 
While we recognize that cremation may not be the preferred interment
option for many veterans, identifying veterans' burial preferences,
as NCS plans to do, would enable it to better manage limited cemetery
resources and more efficiently meet veterans' burial needs. 


------------------------------------------------ Chapter Statement:4.1

Mr.  Chairman, this concludes my prepared statement.  I will be glad
to answer any questions you or Members of the Subcommittee may have. 


*** End of document. ***