VA Testimony of Togo D. West, Jr. before Congress on March 22, 2000

STATEMENT OF THE HONORABLE TOGO D. WEST, JR.
SECRETARY OF VETERANS AFFAIRS
FOR PRESENTATION BEFORE THE
HOUSE COMMITTEE ON APPROPRIATIONS
DEPARTMENTS OF VETERANS' AFFAIRS AND HOUSING AND URBAN
DEVELOPMENT AND INDEPENDENT AGENCIES APPROPRIATIONS SUBCOMMITTEE

Mr. Chairman and members of the Committee, good morning. I am pleased to present the President’s 2001 budget request for the Department of Veterans Affairs (VA). The President’s budget for 2001 uses a fiscally responsible approach to balancing the budget. Utilizing realistic and responsible funding levels, it puts our Nation on a path to eliminate the national debt in the year 2013, making our Nation debt free for the first time since 1835.

The President’s request for VA reflects the largest discretionary dollar increase ever proposed for veterans’ programs. It demonstrates his continued commitment to those who served our country with honor. Our budget proposes significant increases for each of VA’s three administrations and all of our staff functions. These resources will allow us to continue to improve our ability to provide the highest quality service to our Nation’s veterans—service they have earned through their sacrifices for America.

We are requesting approximately $48 billion, which includes $22 billion for discretionary programs, without collections, and $26 billion for entitlements. Our request for discretionary programs is $1.5 billion more than last year’s enacted funding level. This request, along with additional resources agreed to by Congress and the Administration in 2000, reflects a two-year total increase of more than $3.1 billion, or 16.4 percent.

Our veterans are entitled to the best health care America can provide. In the past few years, we have transformed the hospitals run by VA to provide greater access for better care to more veterans. And with the funding in our Fiscal Year 2001 budget, we will continue this improvement.

The budget provides $20.9 billion, including $608 million in medical collection transfers, to provide medical care to eligible veterans. This represents a $1.4 billion increase over last year’s level. VA plans to open 63 new outpatient clinics and treat 100,000 more patients in 2001 than in 2000, a 2.6 percent increase. This patient level is 24 percent above the 1997 baseline, which exceeds our goal of a 20 percent increase.

We are focusing our resources on improving veterans’ access to VA health care and the services we provide them through newly established service standards and access goals. These are:

New patients are to receive an initial or non-urgent appointment with their primary care or other appropriate provider within 30 days.
Patients will receive a non-urgent specialty appointment within 30 days when referred by a VA practitioner.
Patients will be seen within 20 minutes of their scheduled appointment.

Restructuring efforts made possible through the use of buyout authority will allow us to redirect an additional 1,500 full time equivalent (FTE) employees to meeting these goals. Altogether, more than 2,200 employees will be dedicated to improving access and services. These FTE, along with planned management savings and an additional funding request of $77 million, will provide a total resource commitment of $400 million in this area in 2001.

To enhance VA’s leadership role in patient safety management, we plan to spend $137 million to monitor and oversee safety issues and to comprehensively train all VA staff on a recurring basis.

We are also requesting an increase of $145 million to treat veterans with Hepatitis C. In addition, our budget would fully fund the $548 million needed to implement provisions in the Millennium Act dealing with specialized mental health services, emergency care, and extended care services—rather than depend on new collection authority generating $350 million. Consequently, this amount of collections will be returned to the Treasury.

Enhancing VA’s patient safety management and reporting system will also improve the quality of care we provide veterans. It has been reported in medical literature that as many as 180,000 deaths occur in the United States each year due to errors in medical care, many of which are preventable. It will take dramatic action from every health care provider, not only VA, to improve in this area.

VA has not only recognized the problem, but also recognized that it is the greatest opportunity we have had in a very long time to make dramatic improvements in the way health care is provided in our country.

We have acknowledged that it is impossible to correct or prevent errors without first accepting that they exist.

We are taking a systematic approach to solving the problem of patient safety, and to the way we deliver health care, to identify problems and develop solutions.

We have launched the National Patient Safety Partnership, an organization that has brought together Federal and private sector experts to join forces to address this problem.

We have recognized that change will require a team effort at every level of our organization, and we are committed to making that effort.

VA has led the Nation in identifying problems that result in medical errors. Our budget will enable VA to continue its world leadership in patient safety initiatives—benefiting not only veterans, but all Americans.

Our oversight of patient safety will be addressed through comprehensive monitoring at the national and local levels. We will be redirecting an additional 190 FTE toward patient safety enhancements, which means 500 FTE will be dedicated to this effort. Significant training, highlighted by a national center for patient safety, a quality scholars program, and 20 hours of biannual training for all full-time staff, will keep VA at the forefront of this important area.

In addition to basic clinical components funded through medical care, the 2001 budget request provides considerable support for the education and training of health professionals, and for VA’s research programs.

In addition, we will increase the number of unique patients treated to 3.9 million, continue to enhance the quality of our care, and improve customer satisfaction.

Among our most important new initiatives are those designed to provide long-term care for veterans. These initiatives are linked to the provisions of the Millennium Act. The $350 million increase for these initiatives included in this budget will enhance home and community-based care programs for older veterans. It will also cover out-of-system emergency care for certain veterans.

VA is committed to formulating and implementing a well-designed pilot of VA-Medicare subvention. Currently, the Department of Defense is operating a three-year subvention demonstration in six sites, scheduled to end in December 2000, and the demonstration results may offer a useful lesson for us. We look forward to working with you again to pass a VA subvention model that does not jeopardize the Medicare Trust Funds or VA’s ability to provide top-quality medical care to high priority veterans.

We propose a legislative initiative to combine the Health Care Services Improvement Fund and the Extended Care Revolving Fund with the Medical Care Collections Fund (MCCF) to improve administrative efficiencies. This legislative proposal also allows 50 percent of medical collections to be returned to the Treasury as they are received until a level of $350 million is achieved. Returning collections in this amount will recoup Millennium Act funding appropriated in medical care, while maintaining an incentive to collect all government debt.

To continue VA’s identification and treatment of Hepatitis C for veterans, we request an additional $145 million, which will increase the total funding level to combat this disease to $340 million. Also provided is funding to meet anticipated increases for pharmaceutical and prosthetic costs.

We continue to support a two-year spending availability of $900 million, less than five percent of our resources—excluding those funds set aside due to the deferred spending of medical equipment funds required by law. This proposal will provide VA with maximum flexibility regarding spending decisions and will promote cost-effective decision-making.

For Medical and Prosthetic Research, a total of $321 million and 2,883 FTE will support more than 1,942 high priority research projects to enhance the quality of health care our veterans are provided. This level of funding will allow VA to continue our significant research in the areas of Gulf War veterans’ illnesses, diabetes, Parkinson’s disease, spinal cord injury, cancer, prostate disease, depression, environmental hazards, and women’s issues, as well as rehabilitation and Health Service Research and Development field programs.

No other federally-supported clinical or research entity has initiated or completed such critical and ambitious research activities on behalf of America’s veterans as VA. The Department expects the amount of non-appropriated research funding we receive from the private and public sectors to total an additional $497 million.

The Balanced Budget Act of 1997 and the Millennium Act allow VA to retain collections from third parties, copayments, per diems, and certain other sources. These collections are deposited in the MCCF and are available for transfer to the Medical Care appropriation. The funds remain available to VA until they are expended. For 2001, VA estimates more than $958 million will be collected, of which VA will retain $608 million.

In part, we will be able to do this by implementing reasonable charges to certain veterans for inpatient and outpatient procedures. In addition, we are in the process of ensuring that our collection documentation meets the requirements of the Health Care Financing Agency. We are also looking to improve our ability to collect funds from private sector organizations. Additional Tricare payments from the Department of Defense, and increased copayments by veterans as provided for in the Millennium Act are assumed in the collection estimate.

For the Medical Administration and Miscellaneous Operating Expenses, or MAMOE activity, we are requesting $64.8 million in appropriations and expect $7.2 million in reimbursements to support 584 FTE in 2001. This level of staffing will strengthen the functions, especially in the areas of quality assurance and performance management, needed to oversee VA’s efforts.

Our veterans are entitled to have their claims for benefits processed correctly and in a timely manner. This budget will fund initiatives to process claims and education benefits in an electronic environment—allowing those who process claims to have complete and easy access to the information they need.

For benefits administration, the budget provides $999 million. The request reflects an increase of $109 million over the operating level enacted in 2000 and a one-time adjustment of $30 million from the Readjustment Benefit Account to ensure that all Vocational Rehabilitation and Employment administrative costs are funded from General Operating Expenses. Excluding this technical adjustment, this is a 13 percent increase.

These additional resources will ensure that veterans’ compensation, pension, vocational rehabilitation and employment, education, and housing benefits will continue to be delivered while we move forward with our reengineering efforts. To help us process disability claims more efficiently, provide quality-enhancing initiatives, and continue our succession planning efforts, 586 FTE will be added to compensation processing.

VA’s benefits programs are a tangible expression of the Nation’s obligations to its veterans. For 2001, the Administration is requesting $22.8 billion to support compensation payments to 2.3 million veterans, 301,000 survivors and 864 children of Vietnam veterans who were born with spina bifida, and to support pension payments to 363,000 veterans and 253,000 survivors.

We propose to provide a cost-of-living adjustment (COLA) based on the change in the Consumer Price Index, to all compensation beneficiaries, including spouses and children receiving dependency and indemnity compensation. The percentage of the COLA is currently estimated at 2.5 percent, which is the same percentage that will be provided, under current law, to veterans’ pension and Social Security recipients. The increase would be effective December 1, 2000, and would cost an estimated $345 million during 2001.

If Congress approves, VA will pay full disability compensation to veterans of Filipino forces residing in the United States who currently receive benefits at half the level that U.S. veterans receive. The cost of this legislation is estimated to be $25 million over five years.

The Administration is also proposing repeal of a provision in the Balanced Budget Act of 1997 which would preclude the Government from making its October, 2000, VA-benefit payments on Friday, September 29, 2000 and instead require that they be delayed until Monday, October 2 (in fiscal year 2001). Under the law which would otherwise apply, when the first of the month falls on a weekend, payments are to be made on the Friday immediately preceding it.

In order to enhance educational opportunities for veterans and eligible dependents and provide various special assistance programs for disabled veterans, an appropriation of $1.6 billion is being requested for the Readjustment Benefits program.

Education benefits will be provided for about 480,000 trainees in 2001, including 309,000 training under the Montgomery G.I. Bill. This request includes funds for the annual Consumer Price Index adjustment, which is estimated to be 2.7 percent effective October 1, 2000, for education programs.

The heart of the Veterans Benefits Administration’s (VBA) strategy for improved customer service is measurable success. This budget builds on critical indicators that have been instrumental in past performance. VBA is positioning itself to improve dramatically the delivery of benefits and services.

Mr. Chairman, as we all know, VA is not completing work on claims for compensation and pension benefits in as timely a manner as we would like. This is a difficult problem not easily or quickly resolved. More veterans are receiving disability compensation today than at any time in the history of the United States and, despite a declining veteran population, VA has an ever-increasing compensation workload.

Veterans are filing claims today for more issues or conditions than at any time in our history. The complexity of these claims has also increased dramatically. The level of effort required to evaluate a claim for benefits today is significantly greater than just eight years ago. This is because of both the increased complexity of today’s claims and expanded procedural requirements occasioned by judicial review of our decisions. VA has embarked on an aggressive program to hire veterans service representatives who, when fully trained in these intricate procedures, will ensure veterans get the right decision on their claim the first time.

By the end of 2001, we expect to have 1,000 more employees to work on adjudicating claims than we had last year. Significant strides have been made in implementing our case management approach to customer service and in improving the information technology infrastructure that supports veterans’ claims processing. For example, two years ago, a veteran would get a busy signal more than half the time he or she called our nationwide toll-free number; today, the percent of blocked calls is 5 percent.

The problems facing VA in overcoming its claims processing backlog were long in making and are systemic in nature. All of us are dissatisfied with the rate of our progress, but there is no "quick fix" to this problem. To do what is needed will take time, but we have put in place a foundation for success and are requesting a budget through which these goals will be achievable.

Our vision for VBA emphasizes accurate and timely claims decisions, along with a high level of customer service and satisfaction. To reach those goals, VBA’s 2001 budget request is $999 million and 11,824 FTE. This represents an increase of $109 million and 287 FTE above the 2000 level, plus a one-time adjustment of $30 million from the Readjustment Benefit Account for Vocational Rehabilitation and Employment administrative costs.

By combining this increase in the number of employees with positions available due to efficiencies in other areas, VBA will be able to increase its number of personnel in claims processing and associated initiatives by 586. This will result in a 20 percent increase in adjudication staffing since 1999.

This budget continues to include funding for a pilot project, Virtual VBA, which will allow VA to process veterans’ claims in an electronic environment, eventually eliminating the now paper-intensive and time-consuming manual claims process. When fully implemented, it will provide for complete access to information by anyone with access to the new system.

In addition to the electronic claims processing pilot project and increased FTE, VBA seeks funding in the amount of $31.1 million for a number of other C&P initiatives including:

Funding is included for the enhancement of education activities intended to improve stakeholder and customer satisfaction. Building upon the EDI/EFT initiative, funding is included for The Education Expert System (TEES), an umbrella project that will expand our achievements in the area of electronic data exchange and funds transfer, and will make changes to the application used by schools to transmit enrollment information to VA.

This budget contains several initiatives designed to provide much needed improvements in service and accountability to VA’s housing program. Included is funding to redesign our Loan Service and Claims processes in order to automate routine activities. Funds are also provided for an ongoing effort to consolidate guaranteed loan servicing at the nine Regional Loan Centers. Other projects include providing a redesign of the Construction and Valuation system; continuing the consolidation of the mortgage loan accounting functions to one centralized location; and enhancing the Lockbox Funding Fee system and a system to provide on-line determinations of eligibility for loan guaranty benefits.

Funding has also been included to support several areas of service that the Vocational Rehabilitation and Employment program has sought to strengthen. These initiatives are designed to improve communications, emphasize outreach, increase access, improve case management, and emphasize the program’s central goal of finding appropriate employment for our veterans.

Mr. Chairman, issues regarding the Department’s responsibility to procure for claimants the evidence necessary to establish their eligibility for disability and death benefits are also of concern to many. What responsibility do claimants, and those advocating on their behalf, have to first demonstrate their claims are plausible before significant Government resources are devoted to the claims’ further development? Should the Department’s obligation be the same regardless of a claim’s plausibility, or should VA resources be devoted to those claims most likely to prove meritorious? The answers will directly affect our ability to award benefits in a timely manner to deserving claimants.

On December 2, 1999, we published for public comment a notice of proposed rulemaking concerning well-grounded claims and VA’s duty to assist claimants. Consistent with currently controlling judicial precedents, the regulations we have proposed would include important exceptions to a general rule that claimants must present plausible claims before the Department’s duty to assist arises.

First, under the proposed rule, there are certain types of assistance VA would provide without regard to whether a plausible claim had been submitted. VA would routinely procure service medical records in claims for service-connected disability or death benefits, and would obtain records of any VA medical treatment identified by a claimant.

Further, if VA determines a claim is not "well grounded," which is the legal term denoting plausibility, a claimant would be notified of the types of evidence they would need to present to make it so. In addition, our proposal exempts certain claimants from the well-grounded-claim requirement: those whose claims are filed within a year after service separation, and certain specific categories of others, such as the terminally ill and those unable to afford medical treatment, for whom the burden of producing evidence may be especially onerous.

Within the dictates of current law, we have attempted to strike an appropriate balance between the obligations of claimants for Federal funds and their claims representatives and those of the Government they honorably served.

We are hopeful that, with input from veterans and their representatives, we can develop a final rule that will be both acceptable to veterans and administratively feasible. Should Congress judge the outcome of this rulemaking unacceptable and contemplate shifting more of the evidentiary burden onto the Department, we ask only that consideration be given to the resource and performance issues, which would necessarily accompany such a change in law.

Our veterans deserve a dignified and respectful final resting place. The final resting places we provide for them—our Nation’s VA cemeteries—are national shrines and must be maintained in a way that does honor to the men and women who are buried there.

The budget requests $110 million, $13 million more than the 2000 enacted level, for the operation of the National Cemetery Administration (NCA). This 13 percent increase will reinforce our national shrine commitment by beginning an extensive renovation of the grounds, gravesites and grave-markers at cemeteries where the most need exists.

New national cemeteries at Albany, NY; Chicago, IL; Dallas/Ft. Worth, TX; and Cleveland, OH will be fully operational in 2001. We will begin master planning on sites in Atlanta, GA; Detroit, MI; Miami, FL; and Sacramento, CA.

One of VA’s strategic goals is to assure that national cemeteries are shrines dedicated to preserving our Nation’s history, nurturing patriotism, and honoring the service and sacrifice veterans have made. In order to achieve this objective, it is necessary for NCA to address some deferred-maintenance needs. Improvements in the appearance of burial grounds and historic structures will be accomplished with an additional $5 million requested in this budget.

VA estimates that the annual number of veteran deaths will peak in the year 2008 before beginning to decrease. Consequently, NCA’s workload is projected to rise during that period. NCA is preparing for this increase by planning for the construction of new national cemeteries, extending the service life of existing cemeteries, and encouraging states to build state veterans cemeteries.

This budget includes funding and FTE to address increasing interment and maintenance workload at the national cemeteries, including the high rates of increase in interments during the first years of operation at the new cemeteries just completed. The budget also includes planning funds in the Construction, Major Projects appropriation to continue the development of additional new national cemeteries.

VA is asking for $226.5 million for the Office of the Secretary, six Assistant Secretaries, Board of Veterans’ Appeals, Board of Contract Appeals and General Counsel. This request, along with $4.4 million associated with credit reform funding, will provide us a total resource level of $230.9 million.

Compared to last year’s appropriation, the 2001 request is $20.3 million higher. The budget authority, along with $53 million in anticipated reimbursements, will provide for total obligations of $280 million in 2001. FTE will decrease by 93 in 2001 from the 2000 current estimate of 2,528.

We are requesting $45.9 million in funding for the Board of Veterans’ Appeals for 2001. The Board's marked improvement in timeliness in making decisions on veterans claims, its increase in productivity, and its reduction of the appeals backlog from 1995 through 1999 have exceeded our most optimistic expectations.

The budget request will give us the opportunity to continue to decrease the amount of time it takes to process veterans’ appeals. BVA and VBA have adopted a joint performance indicator that is a system-wide measure of how long it takes to resolve an appeal made by a veteran. In 2001, we project it will take an average of 650 days. In 1999, it took an average of 745 days.

We are requesting $56.6 million for the Office of the General Counsel. This would include $47.6 million in budget authority, and an additional $9.0 million funded through reimbursements under the MCCF, the Credit Reform statute, and other reimbursable authorities. This level of funding is essential if the office is to continue to meet the increasing demand for legal services required by VA’s three Administrations, and if it is to keep pace with its representational responsibilities at the Court of Appeals for Veterans Claims (CAVC).

Increased funding for the Office of the General Counsel will also permit us to address rising demands for representation of the Department in workplace disputes.

For the Office of Information and Technology (OI&T), we are requesting $30.9 million in total obligations and 195 FTE, including $22.3 million in budget authority (156 FTE) and reimbursements of $8.6 million (39 FTE). These resources would enable OI&T to continue to support information technology policy, program assistance, VA capital planning, the nationwide telecommunications network, the VACO campus office automation platform and local network, and other efforts. The Austin Automation Center is separately supported by VA’s Franchise Fund.

VA successfully began the Year 2000 without any significant Y2K incidents. VA benefits were paid on time and our health care facilities remained open throughout the date rollover. Having met the challenge of Y2K, our next priority is information security.

In early 1999, VA initiated a Department response to the General Accounting Office (GAO) and Inspector General recommendations on the need for a strengthened VA information security program. A Department-wide working group created a security plan for investment of $83.3 million from 2000-2005 with funding to be redirected from completed Year 2000 efforts.

The plan, which GAO commended, is a comprehensive approach to managing risk through continuous risk assessment, incident response processing, policy development, workforce education, virus protection, intrusion detection, and strong centralized management and oversight. Immediate undertakings have resulted in the establishment of a national Critical Incident Response Capability system, which tracks security incidents; the initiation of a Department-wide assessment of risk; piloting of Web-based workforce security awareness training; and the issuance of strengthened security policies for high-risk areas.

For 2001, the Office of Financial Management (OFM) is requesting $30.9 million in total obligation authority and an average employment of 229. Before I discuss the specifics of our request for OFM, I would like to highlight a recent accomplishment. I am pleased to announce our success in obtaining an unqualified opinion on the Department’s Consolidated Financial Statements for Fiscal Year 1999 and 1998. This represents a major milestone in improving financial management and reporting in VA and provides sound baseline information to build upon for the future. It also fulfills my commitment to the President to obtain a clean audit opinion on our FY 1999 financial statements in my July 1998 letter. Office of Financial Management staff and the Chief Financial Officer staffs of the Veterans Health Administration and the VBA made a significant effort to make this possible.

The request for OFM includes $29.1 million in budget authority and $1.8 million in reimbursable authority. These resources will allow us to continue our current level of operations and sustain efforts on critical initiatives underway. Reimbursements will fund financial operation and program reviews, and will allow us to provide assistance in financial policy development and oversight. The requested budget authority also includes $2.6 million toward implementation efforts of a new integrated VA core Financial and Logistics System to replace the current financial management system and its interfaces. OFM will coordinate the Department’s investment in this area. In 2001, the total investment of approximately $57 million will fund specific tasks for the acquisition (Phase III) and the prototyping and implementation (Phase IV) phases of the project.

We are requesting $13.9 million and 65 FTE to support the activities of the Office of Planning and Analysis (OP&A). With these resources, OP&A will continue to facilitate the Department’s strategic planning process; provide actuarial and analytical support to VA program offices; conduct statutorily required program evaluations; coordinate corporate management improvement activities; and support the development, analysis, and review of issues affecting veterans’ programs.

Funding increases for 2001 will support expanded analyses and reports of data collected in the National Survey of Veterans, which will be conducted in 2000. Additional funding will be used to enhancing data development and actuarial services so that VA program offices and others will have available more sophisticated demographic and socio-economic information about veterans. This will improve our service-delivery planning.

Increased funding will also support a continuous environmental scan process, including stakeholder consultation sessions and focus group meetings, and an ambitious schedule of program evaluations mandated by Title 38 and the Government Performance and Results Act.

The Office of Human Resources and Administration (HR&A) is requesting $82.8 million in total obligation authority and an average employment of 579 FTE. The requested budget authority for HR&A is $51.4 million.

Included are requests for additional resources to carry out several initiatives, such as developing and implementing strategies to prevent discrimination complaints; developing a Departmental workforce succession planning and decision system; conducting the Department’s next One VA organizational assessment; conducting VA’s next Human Resources conference; and maintaining and testing the Department’s Continuity of Operations Plan for assuring essential emergency services.

The total figure for HR&A reimbursements is $31.4 million. This includes $27.8 million and 260 FTE for the Office of Resolution Management (ORM) and $3 million to complete development of the department’s HR LINK$ personnel payroll system. In 2001, the Department is again requesting that the operations of ORM and Office of Employment Discrimination Complaint Adjudication (OEDCA), located in the Office of the Secretary, be funded through reimbursements from its customers.

In summary, a total appropriation of $1.062 billion is requested for General Operating Expenses (GOE); $835 million for VBA and $226.5 million for General Administration in 2001. This funding level, combined with $168 million of administrative costs associated with VA’s credit programs, funded in the loan program accounts under credit reform provisions; $9.8 million in reimbursements from the compensation and pensions account for costs associated with the implementation of the Omnibus Budget Reconciliation Act of 1990 as amended; $36.5 million from insurance funds’ excess revenues; and other reimbursable authority, will provide $1.359 billion to support operations in the GOE account.

September 30, 1999. The six lines of business, our Enterprise Centers, are proving to be very successful. Sales to federal entities have dramatically increased since our initial year of operations in 1997, from $59.1 million to $97.3 million. The 1998 financial statements of the Fund were audited by a private sector CPA firm. The audit resulted in an unqualified, or clean, opinion. On October 1, 2000, the Shared Services Center (SSC), which will support the implementation and operation of the HR LINK$ personnel payroll system, will join VA’s Enterprise Centers.

The 2001 request for the Office of the Inspector General (OIG) contains total resources slightly over $49 million. The request includes direct budget authority of $46.5 million and planned reimbursements of $2.6 million, which supports average staffing levels of 369 and 24 positions, respectively.

This funding provides OIG with an increase of $1 million for nine positions. The request will assist OIG in expanding oversight in the quality of health care services rendered our veterans, identifying internal control vulnerabilities in benefit payment processes, and detecting fraud through extensive review and analysis of VA databases and matching initiatives.

We are requesting new budget authority of $309 million for the Department’s construction programs. Our request provides funding for two major construction projects and another $10 million for an effort to assess our medical infrastructure needs for the future. A 10 percent increase above last year’s requested level is included for minor construction and the grant programs for state veterans’ nursing homes and cemeteries.

We are requesting new budget authority totaling $62 million for the major construction program. The major construction request includes funding for a seismic corrections project at Palo Alto, CA and a gravesite development project at Ft. Logan National Cemetery in Colorado. An additional $10 million is requested in planning funds to continue the Capital Asset Realignment for Enhanced Services (CARES) studies. Congress initially provided $10 million to begin these market- based assessments of health care requirements and capital needs in 2000. The 2001 request also includes planning funds to continue the development of four new national cemeteries, to be located near Atlanta, GA; Detroit, MI; Miami, FL; and Sacramento, CA.

Additionally, we are requesting new budget authority totaling $162 million for VA’s minor construction program. The request will be used to make improvements throughout the Nation to our medical centers’ ambulatory care settings, patient environment, and aging infrastructure. Funds have also been requested for nursing home care, clinical improvements, correction of code deficiencies in existing facilities, and the elimination of fire and safety deficiencies at our facilities.

Funds requested in the minor construction budget will also support VBA and staff office construction requirements, and gravesite development and improvements at existing national cemeteries. In addition, as a result of the expanded authority provided by the Millennium Act, minor construction funds may be used to make capital contribution payments for enhanced-use lease projects such as the new regional office building at Milwaukee, Wisconsin.

The 2001 request of $60 million for the Grants for the Construction of State Extended Care Facilities will provide funding to assist states in establishing new nursing homes and domiciliaries or renovating existing facilities. The 2001 request of $25 million for the Grants for the Construction of State Veterans Cemeteries will provide funding to assist states in establishing, expanding, or improving state veterans cemeteries.

Mr. Chairman, for 224 years, America’s men and women in uniform have brought a record of security and peace to the North American continent that is unmatched in the history of the world.

I believe this budget meets the needs of the Nation’s veterans and lives up to the commitment we have to them.

I want to thank the members and staffs for your continued interest in our Department’s needs. I look forward to continuing to work with you on behalf of our Nation’s veterans and their families.

I also want to thank the Veterans Service Organizations for the vigorous efforts they have made on behalf of veterans during the appropriations process, and I look forward to continuing to work with them on these issues in the future.