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1) VA Secretary Confirms Veterans’ Benefits Could be Cut - At a joint House Veterans Affairs and Armed Services Committee hearing in late July Department of Veterans Affairs Secretary Eric Shinseki admitted that if ”sequestration” occurs, there will be cuts to the Department of Veterans Affairs and those cuts could include the administration of veterans’ benefits and services.

According to Shinseki, “VA is exempt from sequestration except for administrative costs … I don’t have a definition of administrative costs right now.”

This admission was unexpected in light of a statement issued by the Office of Management and Budget last April which stated that the VA budget would not be affected by sequestration. Sequestration is the term used to describe automatic cuts in the federal budget that were part of a bill passed last year by Congress as part of a deficit reduction bill. At the time it was believed sequestration would never occur because the so-called Super Committee was supposed to reach a grand bargain that would reduce the deficit and avoid the automatic cuts. Of course, no agreement was reached and now the automatic cuts are set to take effect on January 2 of next year unless a new agreement can be reached.

In a press release issued after the hearing House Veterans Affairs Committee Chairman Jeff Miller (R-Fla.) said, “I am now demanding that VA and the President define ‘administrative costs.’ Does this mean closing veterans’ hospitals, fewer claims processors to help veterans with their disability compensations, longer wait times for veterans suffering from the invisible wounds of war or those having to bury a loved one, not to mention the possible impact on homeless veterans’ programs and research to care for our wounded warriors? Congress, and more important, our veterans, deserve an honest, straight-forward answer.”

According to that same press release the hearing also discussed DOD/VA seamless transition. “In the first joint hearing of the two Committees in recent history, Members also addressed serious concerns that the Departments of Defense and Veterans Affairs were not working fast enough toward a seamless transition for servicemembers leaving the military. Secretary Shinseki noted that over the next five years, there is the potential for one million serving men and women to either leave military service or demobilize from active duty, raising numerous questions on the already convoluted transition process for veteran.”.

Wait times for the Integrated Disability Evaluation System, which assists wounded warriors transition from DoD to VA, are already at record highs, the disability claims backlog has tripled in the past four years, and a majority of veterans seeking mental health evaluations wait an average of two months for an appointment.

“Despite repeated assurances from VA and DoD to provide a ‘warm handoff,’ it is clear that is not happening. Unfortunately, what we heard today, we have heard before. And what is clear is that there are still no tangible results demonstrating that the silos between the departments have been broken down,” Miller said. “American know-how put a man on the moon in less than a decade, but 50 years later we can’t produce single electronic medical database for our military and veterans in the same span of time? There is clearly something wrong with this system, and the time has come to see real change and real results.”

Seamless transition is something that TREA has lobbied for and supported for years through multiple administrations. That is, no doubt, the reason for much of Chairman Miller’s frustration. It doesn’t seem to matter who the President is, VA and DOD never can get their acts together.

TREA will carefully monitor this and will fight to stop any cuts to veterans’ benefits.

2) DoD is Criticized by Senate Appropriators - Two weeks ago we told you about the request by the Defense Department to “reprogram,” which means shift, $703 million from this years’ health care budget into other DOD programs. TREA and many others have asked how can DOD justify wanting to raise TRICARE fees on retirees when it actually spent less than it had asked for in the health care budget.

And this is at least the third year in a row DOD has made this same request.

According to a report in Bloomberg BNA’s Daily Report for Executives this week, members of the Senate Appropriations Committee have criticized DOD for this and other actions like it regarding how DOD manages and spends its budget.

The article says in part, “ The report accompanying the Senate version of the fiscal year 2013 defense spending bill criticizes the Pentagon's approach—particularly its reliance on cuts in force structure—to meeting the Budget Control Act's spending limits.

“The bill report, made public late Aug. 3, reflects Senate appropriators' frustration with the Defense Department's budgeting.

“DOD is looking for short-term solutions rather than ‘correcting years of poor fiscal discipline’ and improving its acquisition processes, the report says. A better approach, according to the report, would be to cut funding for troubled programs, issue fewer duplicative budget requests, and stop overstating funding requirements.

“In addition, the report cites a ‘disconcerting’ number of reprogrammings and requests to start new programs that are submitted outside the normal budget cycle.”

TREA has been telling Congress that DOD’s request for increased TRICARE fees is ridiculous in light of the fact that DOD cannot even account for where it spends all of its money. We firmly believe that if DOD could figure that out there would be plenty of money to pay for health care without raising any fees.

This action by the Senate Appropriations Committee makes it appear that Congress is finally starting to listen. We will keep up the pressure to get DOD to learn where it spends its money because DOD has been saying for years that it is trying to get its budget process fixed – but then keeps missing its deadlines and saying it will take a few more years.

3) Guard-Reserve Can Expect Long Training Periods Even After Fighting Ends - In an interview recently with USAToday, Army Chief of Staff Gen. Ray Odierno said that even after the fighting in Iraq and Afghanistan is over, members of the Guard and Reserve components shouldn’t expect to return to the one drill weekend a month, two weeks annual training schedule that was in place before 2003 U.S. invasion of Iraq. While the one weekend a month drill will stay, training periods will grow from a two-week block up to seven weeks.

The change is scheduled to take place next year. It is part of maintaining an “operational reserve,” as opposed to a strategic reserve that was in place during the Cold War.

According to Odierno, select National Guard and Reserve units will be part of a five-year cycle of training. Those unites will be available for deployment during the last year of that period, probably for no more than 30 to 45 days.

4) VA Contracting Process Reveals Flaws in Bidding, Services Provided to Veterans - TREA: The Enlisted Association has long railed against the Department of Veterans Affairs’ contracting procedures, both in how they hire veteran-owned small businesses and in the services that the VA provides to veterans. The following stories show that much, much more work needs to be done.

According to the Washington Post this week, the VA is reviewing its decision to bar a retired Navy SEAL’s small business from being able to bid on contracts reserved for veteran-owned small businesses.

Last month, a VA employee visited Syncon, a Chesapeake, Va.-based construction firm owned by Mark Lilly, a 23-year veteran who was shot in Afghanistan and has a Purple Heart, a Silver Star and five Bronze Stars.

The VA denied the business veteran-owned status in June, saying Lilly’s partner, who isn’t a veteran, had more construction experience. The VA questioned whether Lilly, 47, who has a Virginia contractor’s license, was in charge of daily operations as agency rules require.

Two congressional subcommittees held a joint hearing August 2nd on the agency’s new verification system, which has drawn complaints from veteran business owners turned down during the process. Numerous concerns have been raised regarding the VA’s verification program in the past, including it’s inability to stop fraudulent businesses from posing as a veteran-owned small business (VOSB) or service-disabled veteran-owned small business (SDVOSB.) That has led to the current problems, however, which now extend beyond fraudulent representation and range from efficiency and time needed to approve a VOSB or SDVOSB to the types of documentation required for verification. In short, in trying to fix the fraud problem, it has been made harder for honest businesses to prove that they are veteran-owned.

More than 4,000 companies, or almost two-thirds of all those that applied, have been rejected by the VA since the agency stepped up efforts last year to prevent fraud, according to March data from the VA. About 2,330, or 38 percent, of the 6,150 companies in the VA’s database of veteran-owned contractors haven’t been verified as being owned, controlled and managed by veterans as required by a 2010 law, according to Tom Leney, agency director of the verification office. It is unclear how many have been approved as of now.

More than 1,000 companies rejected for certification have appealed the decisions, according to the VA.

The VA’s new system requires the small businesses to prove that they’re owned, controlled and managed by veterans if they want preferential bidding status.

The agency’s office of general counsel will make the final decision on Lilly’s request for reconsideration, Schuda said in the e-mail. She would not estimate when the review will be done.

In addition to the VA’s contracting problems, there was a report in Bloomberg Government this week about a veteran named Neeson Levinson who said he received a letter from the VA on June 21 that said his 30-employee construction company would not be eligible to bid on VA contracts reserved for disabled veterans

Levinson, a 17-year Navy veteran, said he called the VA’s help desk eight times to find out what was going on. He was greeted each time by an automated message saying his wait time was anywhere from 1,000 minutes to 4,116 minutes, or 2.86 days.

Still, there are concerns that ineligible companies are winning contracts. The GAO, Congress’s investigative arm, said 134 companies that hadn’t met the 2010 law’s requirements received $90 million in VA contracts reserved for disabled veterans from Nov. 30, 2011, to April 1 of this year.

TREA will keep you informed of this important issue.

5) Attention: Possible VRAP Scam Alert - From the Consumer Financial Protection Bureau:

This information came from the North Carolina National Guard. Personnel participating in the Veterans Retraining Assistance Program (VRAP) should seek the FREE assistance from Department of Veteran Affairs employees trained to assist in these matters.

Veterans should NEVER pay a fee to ANYONE offering to assist them in obtaining their benefits.

6) Panetta: No BRAC in 2013 - Secretary of Defense Leon Panetta officially gave up hope Monday on a 2013 round of base closures. In its 2013 budget submission to Congress, the Department of Defense said that it wanted authority to conduct two more rounds of base realignment and closures, or BRAC.
DoD oficials argued that they need to prepare for planned cuts worth $487 billion over the next ten years. But Capitol Hill was not in the mood for more base closures. The House passed a 2013 Defense Authorization bill that did not approve another round of BRAC. The full Senate has yet to pass its’ authorization bill, but BRAC did not pass in the Senate Armed Services Committee, either. Panetta said that DoD wasn't counting on BRAC to meet the budget savings target it is required to achieve under the Budget Control Act, but base closures are going to have to come sooner or later. It is clear that this issue is not going away.

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