```

[Senate Hearing 109-715]
[From the U.S. Government Publishing Office]

                                                        S. Hrg. 109-715
 
  BENEFITS LEGISLATIVE INITIATIVES CURRENTLY PENDING BEFORE THE U.S. 
                 SENATE COMMITTEE ON VETERANS' AFFAIRS

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

                                HEARING

                               BEFORE THE

                     COMMITTEE ON VETERANS' AFFAIRS
                          UNITED STATES SENATE

                       ONE HUNDRED NINTH CONGRESS

                             SECOND SESSION

                               __________

                              JUNE 8, 2006

                               __________

       Printed for the use of the Committee on Veterans' Affairs

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

                                 ______

                    U.S. GOVERNMENT PRINTING OFFICE
28-755                      WASHINGTON : 2007
_____________________________________________________________________________
For Sale by the Superintendent of Documents, U.S. Government Printing Office
Internet: bookstore.gpo.gov  Phone: toll free (866) 512-1800; (202) 512�091800  
Fax: (202) 512�092250 Mail: Stop SSOP, Washington, DC 20402�090001

                     COMMITTEE ON VETERANS' AFFAIRS

                    Larry E. Craig, Idaho, Chairman
Arlen Specter, Pennsylvania          Daniel K. Akaka, Hawaii, Ranking 
Kay Bailey Hutchison, Texas              Member
Lindsey O. Graham, South Carolina    John D. Rockefeller IV, West 
Richard M. Burr, North Carolina          Virginia
John Ensign, Nevada                  James M. Jeffords, (I) Vermont
John Thune, South Dakota             Patty Murray, Washington
Johnny Isakson, Georgia              Barack Obama, Illinois
                                     Ken Salazar, Colorado
                  Lupe Wissel, Majority Staff Director
                   Bill Brew, Minority Staff Director

                            C O N T E N T S

                              ----------                              

                              June 8, 2006
                                SENATORS

                                                                   Page
Craig, Hon. Larry E., Chairman, U.S. Senator from Idaho..........     1
Akaka, Hon. Daniel K., Ranking Member, U.S. Senator from Hawaii, 
  prepared statement.............................................     3
Graham, Hon. Lindsey O., U.S. Senator from South Carolina........     3
Isakson, Hon. Johnny, U.S. Senator from Georgia..................     3
Burns, Hon. Conrad R., U.S. Senator from Montana.................     4
    Prepared statement...........................................     6
Pryor, Hon. Mark, U.S. Senator from Arkansas.....................     7
    Prepared statement...........................................     8
    Letter, on behalf of 13 veteran and industry organizations in 
      support of S. 2416.........................................     9
    Article, Easing Driver Shortage Programs' Aim Trucking 
      Industry 
      Turning to Sponsorships to Fill Growing Need, Arkansas 
      Democrat-Gazette...........................................    10
Salazar, Hon. Ken, U.S. Senator from Colorado....................    11
    Prepared statement...........................................    11
Murray, Hon. Patty, U.S. Senator from Washington.................    24
Thune, Hon. John, U.S. Senator from South Dakota.................    50

                               WITNESSES

Aument, Ronald, Deputy Under Secretary for Benefits, Department 
  of Veterans Affairs............................................    12
    Prepared statement...........................................    14
    Response to written questions submitted by Hon. Larry E. 
      Craig......................................................    19
Ivers, Hon. Donald L., Former Chief Judge, U.S. Court of Appeals 
  for Veterans Claims............................................    27
    Prepared statement...........................................    28
    Letters to Chairman Craig by:
        Hon. Donald L. Ivers.....................................    29
        Frank Q. Nebeker.........................................    29
Kinderman, Quentin, Deputy Director, National Legislative 
  Service, Veterans of Foreign Wars of the United States.........    30
    Prepared statement...........................................    33
Weidman, Richard, Director of Government Relations, Vietnam 
  Veterans of America............................................    38
    Prepared statement...........................................    41
Stichman, Barton F., Co-Director, National Veterans Legal 
  Services 
  Program........................................................    46
    Prepared statement...........................................    48

                                APPENDIX

Schumer, Hon. Charles E., U.S. Senator from New York, prepared 
  statement......................................................    55
DeWine, Hon. Mike, U.S. Senator from Ohio, prepared statement....    56
Gaytan, Peter S., Veterans Affairs and Rehabilitation Commission, 
  the American Legion, prepared statement........................    57
Greineder, David G., Deputy National Legislative Director, 
  AMVETS, prepared statement.....................................    60
    Letter, dated June 8, 2006, to Hon. Larry E. Craig...........    62
Kleine, Douglas M., Executive Director, National Association of 
  Housing Cooperatives, prepared statement.......................    62
    Press release, National Association of Housing Cooperatives..    63
Lee, Rose Elizabeth, Chair, Legislation Committee, Gold Star 
  Wives of America, Inc., prepared statement.....................    64
McKay, James C., Senior Counsel, Covington & Burling, Washington, 
  DC, prepared statement.........................................    65
Paralyzed Veterans of America, prepared statement................    68
Sweeney, Donald, Legislative Director, National Association of 
  State Approving Agencies, prepared statement...................    70
Violante, Joseph A., National Legislative Director, Disabled 
  American Veterans, prepared statement..........................    70
Robert V. Chisholm, Past President, National Organization of 
  Veterans' Advocates, letter to Hon. Larry E. Craig.............    74
Clahchischilliage, Sharon, Executive Director, Navajo Nation, 
  Washington Office, letter to Hon. Daniel K. Akaka..............    75

  BENEFITS LEGISLATIVE INITIATIVES CURRENTLY PENDING BEFORE THE U.S. 
                 SENATE COMMITTEE ON VETERANS' AFFAIRS

                              ----------                              

                         THURSDAY, JUNE 8, 2006

                               U.S. Senate,
                    Committee on Veterans' Affairs,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 10 a.m., in room 
SR-418, Russell Senate Office Building, Hon. Larry E. Craig, 
Chairman of the Committee, presiding.
    Present: Senators Craig, Graham, Thune, Isakson, Murray, 
and Salazar.

      OPENING STATEMENT OF HON. LARRY E. CRAIG, CHAIRMAN, 
                    U.S. SENATOR FROM IDAHO

    Chairman Craig.  Good morning, ladies and gentlemen. The 
Committee on Veterans' Affairs will now come to order today. 
The Committee will hear testimony on pending legislation 
affecting veterans' benefits. The six bills on our agenda 
address a wide array of issues, including housing, 
compensation, educational benefits, veterans' cemeteries, and 
representation.
    At the outset, I would like to comment on two of those 
bills that I have introduced. The first, S. 2562, which will 
provide a cost of living adjustment to the rates of 
compensation provided to over 2.8 million veterans and nearly 
350,000 survivors. The end of the year adjustment is expected 
to be at 2.2 percent, which would result in an estimated payout 
of $530 million.
    As you know, Congressional budget rules do not require an 
offset in spending to pay for these increases, given the 
importance of these annual adjustments in protecting against 
the erosive effects of inflation.
    The next bill I would like to comment on is S. 2694, the 
Veterans' Choice of Representation Act. This bill would provide 
veterans with the option, let me repeat, with the option of 
hiring lawyers to help them navigate VA's administrative 
process, a process that has become increasingly long and 
complex in recent years. The law prohibiting veterans from 
hiring lawyers flows from a Civil War era policy, let me repeat 
that, a Civil War era policy intended to protect veterans from 
unscrupulous lawyers.
    This 150-year-old policy arose at a time, unlike today, 
when attending law school was not required to become a lawyer, 
and there was no effective professional oversight of lawyers. 
Although I know that some will still warn that lawyers are not 
to be trusted, I would like to ask them to consider the simple 
question posited in a recent editorial--I know, Mark is one. 
Thanks, Conrad.
    [Laughter.]
    Chairman Craig. We will not forgive him for that, either.
    But this editorial put it this way, if America's soldiers 
are mature and responsible enough to choose to risk their lives 
for their country, should they not be considered competent to 
hire a lawyer? To me, the obvious answer to that question is 
yes, particularly for veterans of today's all-volunteer force. 
The paternalistic law is completely outdated.
    These highly trained, highly skilled veterans have the 
ability, and should have the right, to decide for themselves 
whether to hire a lawyer. Having said that, I want to be clear 
that, although I believe veterans should have a choice for 
representation, they should not be discouraged from using the 
valuable free services provided by many of our Veterans Service 
Organizations.
    In fact, if quality, free services are available from VSOs, 
I would expect that most veterans would conclude that it is a 
better deal than paying an attorney, but I do not think we 
should make the judgment for the veterans by limiting their 
options. In recent months it has become abundantly clear that 
many veterans and their survivors do want the option of hiring 
an attorney.
    A host of individuals and organizations have expressed 
their support for changing the current policy, including the 
Vietnam Veterans of America, the Wounded Warrior Project, the 
Paralyzed Veterans of America, the Gold Star Wives of America, 
Inc., the National Association of Letter Carriers, the American 
GI Forum, judges from the Court of Appeals for Veterans Claims, 
law professors and bar associations.
    There also is bipartisan and bicameral support in the 
Congress for changing this law. In addition to S. 2694, which 
is cosponsored by Senators Graham, Hutchison, Jeffords, 
Chambliss, and Murkowski, there are now two bills pending in 
the House that would provide veterans with a choice of 
representation. One was introduced by Congressman Lane Evans 
and Congresswoman Shelley Berkley, and the other was just 
recently introduced by Congressman Jeff Miller.
    Even with the very broad spectrum of support, I know that 
some have concerns about trusting veterans with a choice of 
representation. In fact, you will hear today about VA's 
concerns that, if veterans are given a choice, they may end up 
wasting their money. You will hear about VA's concerns that 
attorneys could change the nature of their bureaucracy.
    We will discuss today these issues. I have serious 
questions about whether those concerns are warranted because I 
strongly believe in the principle of individual liberty and 
personal responsibility. I cannot agree that abridging the 
personal rights of all veterans is an acceptable means of 
dealing with these concerns. Rather, I believe we should take 
steps, as this bill would do, to minimize any potential 
problems while ensuring that our Nation's veterans will have 
the right to decide for themselves whether to hire lawyers. 
This is a right that is not denied to individuals seeking any 
other benefits from our Government.
    And I could go on, but let me just simply say this, now 
enemy combatants have the right to an attorney. And I would 
suggest that our veterans should have the same right.
    With that, let me turn to our colleagues who have joined us 
for opening comments prior to turning to our first panel.

             STATEMENT OF HON. LINDSEY O. GRAHAM, 
                U.S. SENATOR FROM SOUTH CAROLINA

    Senator Graham. Mr. Chairman, I would just like to echo 
your sentiment. I have joined with you on the bill to allow 
veterans to have legal representation if they choose. Being a 
lawyer, I understand that it is not the most popular profession 
in the world until you need one.
    And when you need one, you try to find the best one 
available, and I am proud to have provided for what legal 
services I have provided in the military. To be honest with 
you, Mr. Chairman, in the Social Security Administration, there 
is a non-adversarial aspect of it, but legal representation 
there does help people. Our veteran community is getting 
involved in a new system that is ever changing for the better 
and I do not know if I understand it.
    There are some people out there who will dedicate their 
legal profession to understanding veterans benefits and rights, 
and if a veteran would like to be represented, I think they 
should be. When it comes to excessive fees, just like the 
Social Security Administration, there is a procedure to deal 
with that--and those lawyers who take advantage of veterans, I 
hope they get disbarred.
    If there is a lawyer willing to help a veteran and the 
veteran needs the help, I hope we can allow that to happen, 
too.
    Thank you.
    Chairman Craig. Senator Graham, thank you.
    Mr. Isakson.

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

    Senator Isakson. Mr. Chairman, I would like to echo the 
words of Senator Graham and commend you on the legislation, Mr. 
Chairman.
    Chairman Craig. Thank you.
    Let me say, before I turn to our first panel, Senator Akaka 
regrets that he is unable to be here today. I believe he is on 
the floor with a piece of legislation right now. So, I ask 
unanimous consent that his opening statements appear in the 
record at this point.
    [The prepared statement of Senator Akaka follows:]

      Prepared Statement of Hon. Daniel K. Akaka, Ranking Member, 
                        U.S. Senator from Hawaii

    Thank you, Chairman Craig. This legislative hearing was originally 
scheduled for an earlier date, but was postponed so the Committee could 
address the troubling revelation that there was a theft involving the 
private data of millions of veterans. That hearing was very important 
to our veterans. I look forward to working with the Chairman and others 
as we continue to respond to that situation.
    Mr. Chairman, we have a full schedule today, so I will take this 
time to briefly discuss my legislation on the agenda. S. 2659, the 
proposed Native American Veterans Cemetery Act of 2006, would provide 
tribal organizations eligibility for Department of Veterans Affairs' 
grants to establish veterans cemeteries on trust lands. Currently, VA's 
authority to make grants for the establishment of veterans cemeteries 
other than by VA itself is limited to grants to states. This precludes 
making grants to tribal organizations.
    Native American veterans have a long and proud history of military 
service on behalf of this Nation. On a per capita basis, Native 
Americans have the highest percentage of people serving in the United 
States Armed Forces. After completion of their service, many Native 
American veterans return to their communities on trust lands. Passage 
of this legislation would provide the option of burial in a veterans 
cemetery location convenient for their families and loved ones.
    Throughout my time in Congress, I have fought for the rights of our 
indigenous peoples. Recently, with the passage of the Veterans' Housing 
Opportunity and Benefits Improvement Act of 2006, the Native American 
Home Loan program was made permanent. I authored the legislation that 
created the pilot program that granted Native American veterans living 
on tribal lands access to VA home loans. I am thrilled that this 
program is now permanent. I view the proposed Native American Veterans 
Cemetery Act of 2006 as another step in helping native peoples and urge 
my colleagues to support it.
    I thank the witnesses from VA and other organizations for coming 
today to share their views. Thank you, Mr. Chairman, and I look forward 
to hearing the testimony before us today.

    Chairman Craig.  With that, let us turn to the first panel 
this morning. Two of our colleagues are with us, Senator Burns 
of Montana and Senator Pryor.
    Let me turn to Conrad Burns, first, and then will turn to 
Mark. Thank you.
    Welcome before the Committee, Senator.

              STATEMENT OF HON. CONRAD R. BURNS, 
                   U.S. SENATOR FROM MONTANA

    Senator Burns. Chairman Craig and Members of this 
Committee, thank you very much for giving me the opportunity 
this morning to come before you with a very important issue, 
and that is the Veterans Employment and Training Act of 2006.
    As you know, I have had the privilege of serving as a 
United States Marine in the Far East and that service instilled 
in me a great respect for the men and women who serve in our 
military. The sacrifices of our men and women in uniform can 
never be overstated, but particularly in these turbulent times.
    Sadly, many of these individuals are faced with great 
hardship when they leave the service. For too many young 
servicemen and women, the transition to civilian life proves 
extremely difficult, particular for veterans between the ages 
of 18 and 24. I do not see how you can be a veteran at 18, but 
I am trying to figure that out.
    Veterans from the age of 20 to 24, though, is a very, very 
sensitive age, an area where they are coming out of the 
service. The unemployment rate currently stands at 10.2 
percent. This is down slightly, but much higher than the 
national average. And if you go down to the 18- to 19-year-
olds, it goes up to around 26 percent, nearly double the 
unemployment rate of non-veterans in the same age group. Of 
course, that is unacceptable to us.
    To help rectify this situation, we introduced S. 2416, the 
Veterans Employment and Training Act of 2006. Under the 
Montgomery GI Bill, the Veterans' Administration currently 
provides accelerated benefits to assist servicemen and women in 
transitioning into a civilian job. Through this program, the VA 
makes short-term, high cost training programs more attractive 
to veterans by paying benefits in lump sums covering up to 60 
percent of the cost of some of those educational programs. 
However, this program is now only available to men and women 
who seek training in high-tech programs.
    I think you know that when we looked at our technology 
schools and our vocational schools in each of our States we 
find out that we should be training for the job market that is 
there and readily available. And we have changed our vocational 
schools and our technology schools to reflect that.
    In order to provide this benefit to more of our men and 
women of the Armed Forces, the VET Act will expand eligibility 
for accelerated benefits to include industry sectors identified 
by the Department of Labor as likely to add large numbers of 
new jobs or require new job training skills in the coming 
years. These sectors include construction, hospitality, retail, 
financial services, energy, homeland security, health care, 
and, of course, transportation. That is where we have our 
biggest shortfall, in the transportation area.
    A number of these sectors face critical shortages of 
employees now or in the near future, and want to attract 
veterans to their professions. For instance, in my State of 
Montana, we are currently facing a shortage of trained 
construction workers and, of all things, truck drivers. 
Nationally, the truck driving industry needs an additional 
20,000 drivers today and expects to face a driver shortage of 
110,000 drivers by the year 2014.
    The modest change that we are proposing today will help 
provide needed workers to these and other industries. To give 
you an idea on how this will benefit veterans, take for example 
a truck driving training program at one of the schools in 
Montana. This program, a standard for most driving programs, 
lasts 4 to 5 weeks, and it costs $4,000. Unfortunately, many 
veterans are unable to afford this training, even with the 
$1,034 in GI Bill benefits that they may currently receive for 
this training.
    However, under the revised accelerated benefits program 
called for in the VET Act, the same veteran would be eligible 
for 60 percent, or $2,400 of the cost of the training. That is 
the same we give for those going into the high-tech fields.
    We have an obligation to make sure that these individuals 
are not forgotten when they return from service. One step we 
can take now is to ensure that those who serve have access to 
every educational opportunity possible. By expanding 
eligibility for accelerated GI benefits, we will give many of 
these veterans a new opportunity to get training and find work 
in some of the fastest growing sectors of our economy. This 
will keep our country moving on the right track and open up 
more opportunities for our men and women in uniform. We owe it 
to those individuals to act quickly to provide them with this 
expanded benefit.
    And I just want to bring up something else, as far as these 
kinds of training programs are concerned. In Billings, Montana, 
we have three oil refineries. They looked at their human 
resource list, and every one of those refineries was going to 
lose half of their workforce in 5 years to retirement. Who do 
we replace those folks with who are trained and ready to go in 
and start to work in a refinery? That is a very, very sensitive 
work. You turn a valve the wrong way and you have got big 
problems. Safety is number one around a refinery, because you 
are working with volatile materials.
    So, we retooled our vocational school in Billings and we 
built a model about the size of one of these tables, I guess, 
of a refinery. We now offer a 2-year certificate program in the 
operations of refineries for people and young men and women who 
chose not to take a 4-year curriculum, but instead chose to 
attend a school to train for some job in that sector. So, if 
they have marginal grades, they get a 2-year certificate 
degree, they walk out of there, and they walk in to a $40,000-
45,000 job just like that.
    That is what we should be doing, training for the jobs that 
we have in front of us. Automobile dealers tell us that they 
cannot hire mechanics. I thought any farm kid who liked grease 
under his thumb and got a crescent wrench, a set of box tins 
and a screwdriver would go to work as a mechanic. Not true, 
because now they have to have computer skills. When you pull 
your car into a dealer to get it worked on, the first thing 
they do is plug it into a computer. And sometimes it is all put 
back together by a computer, reprogrammed and things like that.
    Our workforce is changing out there for the ordinary, 
everyday people who can make a very good living, support their 
families, and be a vital part of our community, but they need 
those skills to go into that sector. And this, I think--of our 
men and women coming out of the service now--will give them an 
opportunity to train for those jobs.
    I appreciate the time the Committee has given us, and I 
appreciate all the work that we have done on this. I also 
appreciate your support. Thank you very much, Mr. Chairman.
    [The prepared statement of Senator Burns follows:]

   Prepared Statement of Hon. Conrad Burns, U.S. Senator from Montana

    Chairman Craig, Ranking Member Akaka, Members of the Committee, 
thank you for allowing me the opportunity to speak today about 
legislation which is very important to me--the Veterans Employment and 
Training Act of 2006.
    As you know, I had the privilege of serving as a United States 
Marine. That service instilled in me a great respect for the men and 
women who serve in our military. The sacrifices made by our brave men 
and women could never be overstated, particularly in these turbulent 
times.
    Sadly, many of these individuals are faced with great hardship when 
they leave the service. For too many young servicemen and women, the 
transition to civilian life proves extremely difficult, particularly 
for veterans between the ages of 18 and 24. For Veterans age 20-24, 
unemployment currently stands at 10.2 percent; this is down slightly, 
but still higher than the unemployment rate for non-veterans in the 
same age group. And for Veterans 18-19 it is a disturbing 26.4 
percent--nearly double the unemployment rate of non-veterans in the 
same age group. This is simply unacceptable!
    To help rectify this situation, we introduced S. 2416, the Veterans 
Employment and Training (VET) Act of 2006.
    Under the Montgomery GI Bill, the Veterans' Administration 
currently provides accelerated benefits to assist our servicemen and 
women in transitioning to the civilian job market. Through this 
program, the VA makes short-term, high-cost training programs more 
attractive to veterans by paying benefits in a lump sum and by covering 
up to 60 percent of the cost of some educational programs. However, 
this program is now only available to men and women who seek training 
in high-tech programs.
    In order to provide this benefit to more of our brave men and women 
in the Armed Forces, the VET Act will expand eligibility for 
accelerated benefits to include industry sectors identified by the 
Department of Labor as likely to add large numbers of new jobs or 
require new job training skills in the coming years. These sectors 
include construction, hospitality, retail, financial services, energy, 
homeland security, health care, and transportation.
    A number of these sectors face critical shortages of employees now 
or in the near future and want to attract veterans to their 
professions. For instance, in my State of Montana, we are currently 
facing a shortage of trained construction workers and truck drivers. 
And nationally, the trucking industry needs an additional 20,000 
drivers today and expects to face a driver shortage of 110,000 drivers 
by 2014. The modest change that we are proposing today will help to 
provide needed workers to these and other industries.
    To give you an idea how this will benefit veterans, take the 
example of a truck driver training program at one of the schools in 
Montana. This program, standard for most driver training programs, 
lasts 4 to 5 weeks and costs $4,000. Unfortunately, many Veterans are 
unable to afford this training, even with the $1,034 in GI Bill 
benefits that they may currently receive for this training. However, 
under the revised accelerated benefits program called for in the VET 
Act, that same veteran would be eligible for 60 percent or $2,400 of 
the costs of the training.
    We have an obligation to make sure that these individuals are not 
forgotten when they return from service. One step we can take now is to 
ensure that those who serve have access to every educational 
opportunity possible. By expanding eligibility for accelerated GI Bill 
benefits, we will give many of these veterans a new opportunity to get 
training and find work in some of the fastest growing sectors of our 
economy.
    This will keep our country moving on the right track and open up 
more opportunities for our men and women in uniform.
    We owe it to these brave individuals to act quickly to provide them 
with this expanded benefit.
    Thank you once again for providing me with this opportunity to 
speak on this bill.

    Chairman Craig. Senator, thank you very much.
    Now, let us turn to Senator Mark Pryor of Arkansas. Mark, 
welcome again before the Committee.

                 STATEMENT OF HON. MARK PRYOR, 
                   U.S. SENATOR FROM ARKANSAS

    Senator Pryor. Thank you, Mr. Chairman, and thank you for 
your leadership on this. And also, I have a written statement, 
for the record. Senator Burns did a very good job of laying out 
the position, so I will not read the written statement.
    Chairman Craig. Your full statement will become a part of 
the record.
    Senator Pryor. Thank you, Mr. Chairman. It also has a 
couple of attachments. One is an attachment where 13 
organizations support the legislation. The other is just a 
newspaper story from my home State that lays out the problem 
out there in the real world. So, I would love for that to be 
included, as well.
    Basically, what Senator Burns said is exactly right. And 
that is that we have two problems here. One is, when you look 
at our veterans, for veterans between 20 and 24 years of age, 
there is a 15 percent unemployment rate. So, if you are a 
veteran between 20 and 24, you have a 15 percent unemployment 
rate. That is nearly double, obviously, what the national 
average for non-veterans, et cetera, so that is a problem that 
we should address.
    Second, the Department of Labor has identified 14 different 
industries that need workers. These include, again, 14 of them, 
but some of them are transportation, construction, hospitality, 
financial services, homeland security--these are needs that DOL 
has identified exist in our economy. That is a problem.
    We can address both problems and come up with a solution in 
this one piece of legislation. Senator Burns did a very good 
job of laying this out. He is exactly right. If you look at 
just one of those sectors, trucking, right now there is a 
shortage of about 20,000 drivers nationwide. That is a big 
problem for the trucking industry. But when they look out in 
the future in 2014, the DOL anticipates a shortage of about 
110,000 drivers. Again, truck driving might be a great career 
path for many of our veterans.
    What we are trying to do is put the tools in place for them 
to pursue that. Really this is a win-win situation. We are 
helping our veterans, we are helping the U.S. economy, and we 
are just doing, really, something that is common sense. This is 
something we should try to do.
    Mr. Chairman, with that, again, Senator Burns covered this 
very, very well. I would appreciate the Committee's 
consideration on this legislation.
    Thank you.
    [The prepared statement of Senator Pryor with attachments 
follow:]

   Prepared Statement of Hon. Mark Pryor, U.S. Senator from Arkansas

    Chairman Craig, Senator Akaka, and Members of the Committee, I 
would like to thank you for this opportunity to testify before you 
today on legislation that is important to my constituents and young 
veterans all across America.
    Many of our soldiers, sailors, airmen, and Marines coming back from 
Iraq and Afghanistan are having a difficult time finding work, Mr. 
Chairman. I find this troubling, and I feel that we have a 
responsibility to support our returning veterans who are looking for 
work. Currently, unemployment among veterans between the ages of 20 and 
24 is over 15 percent--nearly double the unemployment for non-veterans 
in the same age group.
    Similarly, many of the fastest growing sectors of our economy are 
in vast need of an additional skilled labor source. The Department of 
Labor has identified 14 industry sectors that are expected to 
experience high growth over the next several years, including trucking, 
construction, hospitality, and financial services. In fact, the 
trucking industry, which is very important to my state, currently has a 
driver shortage of 20,000 drivers. That shortage is expected to grow to 
110,000 by 2014. I have a recent article from the Arkansas Democrat-
Gazette detailing the shortage the trucking industry is facing in 
Arkansas. I would like to include it for the record.
    We have industries in need of skilled employees and we have many 
young men and women in need of good, high-paying jobs. Our legislation 
is intended to help match those with needs through increased training 
benefits in the Montgomery GI Bill. The GI Bill, established after 
World War II, was a commitment that Congress made to veterans of that 
war. We would like to extend that commitment to reflect the job 
opportunities of our modern economy.
    To accomplish this task, I joined with my colleague, Senator Burns, 
in introducing S. 2416, the Veterans Employment and Training Act--the 
VET Act. To date, we have a group of seven bipartisan sponsors.
    The VET Act would make those sectors identified by the Department 
of Labor as high growth eligible for accelerated payments under the GI 
Bill by expanding the number of job training programs covered by the 
Accelerated Payment Program.
    Many of the training programs for employment in the identified 
sectors are short but they are often more costly at the beginning. The 
current structure of the GI Bill only provides veterans with the option 
of a smaller monthly stipend. This arrangement works well for 
traditional education institutions, such as two- and four-year 
institutions. However, this same arrangement is not conducive to the 
nature of our changing economy and the nature of high growth 
occupations. A reconfigured and expanded Accelerated Payment Program 
has the potential to pay big dividends for our veterans and our 
economy. The Arkansas Employment Security Department estimates that 
between one-third and one-half of all nonfarm jobs in Arkansas are in 
sectors that would benefit from this legislation.
    For the benefit of my colleagues, let me briefly review a few 
reasons why I think this legislation is a wise policy decision.
    First, I believe the VET Act will help veterans returning from Iraq 
and the War on Terror. Accelerating GI Bill benefits for training in 
high-growth occupations will help place veterans faster in good-paying 
jobs.
    Second, passing the VET Act will encourage returning veterans to 
pursue careers in occupations that will contribute most to the U.S. 
economy. All fourteen sectors identified by the Department of Labor are 
expected to add large numbers of jobs to our economy over the next 
several years. This legislation will assist in matching the available 
workforce with our needs to keep our economy growing.
    Third, the VET Act will help make short-term, high cost training 
programs more affordable to veterans. GI Bill benefits are paid monthly 
with a maximum monthly stipend of $1,000. Many of the training programs 
for occupations identified by the Department of Labor as high-growth 
are short term and high cost in nature. Truck driver training courses 
typically last 4 to 6 weeks, but can cost up to $6,000. Without this 
legislation, GI Bill benefits will only cover between $1,000 and $1,500 
of the cost. Such a low offset discourages veterans from using GI Bill 
benefits from these types of training programs. Accelerated benefits 
would cover 60 percent of the cost, and benefits would be paid in a 
lump sum.
    Last, the VET Act will help place veterans in good-paying jobs at a 
very low additional cost to the Federal Government. S. 2416 merely 
enhances benefits already available--the total cost of the accelerated 
benefits program for high-tech occupations is only $5.7 million. This 
is a very small percentage of total benefits available to veterans 
already. Any additional cost will be small and incremental compared to 
the immediate payoff of reducing unemployment among young veterans and 
enhancing employment opportunities in high-growth occupations.
    To date, ten veterans and industry organizations have endorsed our 
legislation, including the American Legion, AMVETS, American Trucking 
Associations, Owner-Operator Independent Driver's Association, 
Associated General Contractors, and the National Restaurant 
Association, among others. I would like to include a letter of support 
from some of these groups for the record.
    Mr. Chairman, Senator Akaka and Members of the Committee, I believe 
this is good legislation that will benefit our veterans and our 
economy. I look forward to working with all of you to enact the VET Act 
and stand ready to assist you in your mission of helping our veterans 
succeed in civilian life.
                                 ______
                                 
                                                     March 28, 2006
Hon. Mark Pryor,
U.S. Senate,
Washington, DC.
    Dear Senator Pryor: We, the undersigned organizations, are writing 
to ask for your support of S. 2416, the Veterans Employment and 
Training Act (VET Act), legislation sponsored by Senators Burns and 
Pryor to enhance GI bill benefits.
    The VET Act would assist our servicemen and women in transitioning 
to the civilian job market by expanding eligibility for accelerated GI 
bill benefit payments. This modest change to the GI bill program would 
be especially helpful to veterans between the ages of 20 and 24, who 
have an unemployment rate of over 15 percent--nearly double the rate of 
non-veterans in the same age group.
    The legislation would also help keep our economy growing. A number 
of industries face critical shortages of employees now or in the near 
future and are anxious to attract veterans to their professions. For 
example, the skills and experience that men and women have gained 
during their years in military service are highly appealing to trucking 
companies, many of which are struggling to attract and retain quality 
drivers.
    Accelerated benefits, which have been available for high-tech 
occupations since 2002, make short-term, high-cost training programs 
more attractive to veterans by paying benefits in a lump sum per term, 
and by covering a greater share (60 percent) of the cost of such 
programs. The VET Act would expand eligibility for accelerated benefits 
to include 14 industry sectors identified by the Department of Labor as 
likely to add large numbers of new jobs or require new job training 
skills in the coming years, including construction, hospitality, 
financial services, energy, homeland security, health care, and 
transportation.
    We hope you will join us and Senators Burns and Prior in supporting 
the Veterans Employment and Training Act. Our troops returning from the 
war on terror deserve our support, and the VET Act will help veterans 
advance their careers in the sectors of the economy that need them the 
most.

American Association of Community Colleges
American Hotel and Lodging Association
American Trucking Associations
AMVETS
Arkansas Trucking Association
Associated General Contractors
Association of American Railroads
Montana Motor Carriers Association, Inc.
National Private Truck Council
National Ready Mixed Concrete Association
National Restaurant Association
Owner-Operator Independent Drivers Association
Truckload Carriers Association
                                 ______
                                 

           [From the Arkansas Democrat-Gazette, Apr. 9, 2006]

   Easing Driver Shortage Programs' Aim Trucking Industry Turning to 
                   Sponsorships to Fill Growing Need

                           (By Laurie Whalen)

    The trucking industry is counting on new driving school sponsorship 
programs to alleviate its growing shortage of drivers.
    Driver training can take as long as 16 weeks, and tuition can be as 
much as $5,000. Many people have neither the free time nor the money to 
participate.
    That could change for many potential drivers because of initiatives 
such as the ``Company Driver Tuition Finance'' program that was 
announced March 23, with support from the American Trucking 
Associations and the Truckload Carriers Association.
    When drivers are sponsored by a trucking firm, they enter into a 
financial arrangement in which the carrier and a commercial lender pay 
the tuition at a driving school. Drivers typically sign a promissory 
note and enter into a repayment agreement, usually with a condition of 
a year's driving commitment.
    The long-haul trucking industry estimates it needs 20,000 more 
drivers. National projections for the next 8 years show the need 
worsening to 111,000 drivers if current demographic trends continue and 
the overall labor force grows at a slower pace.
    A shortage of drivers could limit the availability of goods and 
increase their price. Carriers can charge higher rates-per mile from 
their shipper customers, who, in turn, can pass along increases to 
consumer.
    Dale Martin, director of the Arkansas Commercial Driver Training 
Institute at Arkansas State University at Newport, predicts the driver 
shortage will cause carrier sponsorships to become more common.
    ``With carrier sponsorship, if a driver fulfills the commitment, 
it's a good deal, especially if you're broke,'' Martin said.
    Only about 25 percent of the estimated 1,000 annual graduates 
secure their own financing at the driver institute's 190-hour, 4-week 
program. The rest have tuition paid by the carrier. Arkansas companies 
P.A.M. Transportation Services Inc. in Tontitown, Willis Shaw Express 
in Elm Springs and USA Truck Inc. in Van Buren are among those that 
offer sponsorships.
    The American Trucking Associations and the Truckload Carriers 
Association also provide what they term as low-interest loans for needy 
drivers who qualify for admission to a training school.
    The effort is a good step in putting together a national program 
for drivers, said Chris Burruss, president of the 800-member Truckload 
Carriers Association in Alexandria, Va.
    U.S. Sen. Mark Pryor, D-Ark., has pushed to include trucking as an 
eligible profession for Veterans Affairs funding, covering as much as 
60 percent of the cost to attend a program.
    Pryor said in a March 15 statement that the Veterans Employment and 
Training Act would benefit soldiers and employers alike. The act would 
expand the occupations qualifying for funding and, according to Pryor, 
help veterans find high-paying jobs and employers find qualified 
employees.
    The trucking industry tends to lose drivers to higher-paying jobs 
such as those in construction.
    Lane Kidd, president of the Arkansas Trucking Association, 
characterized the proposed measure as a ``real world'' type of job 
growth legislation. The legislation is pending in the House Committee 
on Veterans Affairs.
    Arkansas student drivers also get financial help through at least 
two other Federal aid programs. State administrators of the Workforce 
Investment and Trade Adjustment Assistance acts said a small percentage 
of their money finances truck-driving programs.
    The Freeway Program, a new private loan program of last resort for 
qualifying drivers, hopes to capitalize on the shortage and carriers' 
needs to replace an aging work force. The program targets potential 
drivers who are regarded as a financial risk, but who meet other 
criteria such as a clean driving record and drug test.
    Perry Turnbull, a financial consultant and one of the Orem, Utah-
based program's founders, said the fledgling loan purchasing company 
Educational Methods Inc., which administers the Freeway Program, will 
financially benefit carriers and drivers.
    The 10-month-old program, set up much like a carrier sponsorship, 
assumes the term of the loan after driver training is completed. But 
unlike sponsorship, if a driver breaks his promissory note commitment, 
Educational Methods Inc. will attempt to collect on the loan.
    Turnbull, who lives in Bentonville, said drivers benefit from 
fixed-interest rates ranging from 6 percent to 12 percent, which he 
said was low compared with other available rates. In March, the 
business bought its first loan from a Utah-based carrier.
    ``You can't borrow any cheaper than from us,'' Turnbull said.

    Chairman Craig. We thank you.
    Senator Burns. I have something to add, Mr. Chairman.
    Chairman Craig.  Sure.
    Senator Burns. I will tell you it is great to work with 
Senator Pryor on this, as his State and all States, I think, 
face this situation. So, we look forward in shepherding this 
legislation through Congress. I certainly appreciate working 
with Senator Pryor and what he brings to the table. He brings a 
lot of knowledge and on-the-ground experience. I think that is 
what it is going to take to get it done.
    I thank the Committee.
    Chairman Craig.  We thank you both for being here this 
morning to provide testimony to this legislation. I think you 
clearly have pointed out one of the clear options and 
flexibilities we need in the program for this changing 
workforce, and we thank you for that.
    Any questions of our colleagues?
    If not, we thank you much, and we will excuse you.
    We have been joined by Senator Salazar.
    Do you have any opening comments this morning, Senator, 
before we move to our next panel?

                STATEMENT OF HON. KEN SALAZAR, 
                   U.S. SENATOR FROM COLORADO

    Senator Salazar. I am looking forward to the hearing and I 
have a statement for the record that I will submit.
    Chairman Craig. Your full statement will be part of the 
record now.
    [The prepared statement of Senator Salazar follows:]
   Prepared Statement of Hon. Ken Salazar, U.S. Senator from Colorado
    Thank you, Chairman Craig and Ranking Member Akaka, for holding 
today's hearing on legislation regarding veterans' benefits.
    As we work to provide our veterans with the services and support 
they need, this hearing is a good reminder that veterans' needs do not 
stop with access to high-quality, affordable healthcare. I'm looking 
forward to examining the proposals before this Committee today as we 
look to find ways to improve benefits for veterans in the critical 
areas of education, pensions, job training, housing, memorials, and 
access to adequate legal representation. For many of our Nation's 
veterans--including those now returning from Iraq and Afghanistan--
veterans' benefit programs are the key to rebuilding a normal life once 
they come home.
    At last year's benefits hearing, this Committee considered a 
legislative proposal I introduced--the Veterans Employment and 
Transition Services Act--to deal with the need to improve employment 
options for servicemembers leaving the military by allowing veterans 
groups better access to servicemembers, eliminating the conflict of 
interest between reenlistment recruiting and pre-separation counseling, 
and encouraging participation in intensive Transition Assistance 
Program workshops. I am proud to say that provisions of my bill were 
recently included in the comprehensive veterans' benefits legislation 
that recently passed the Senate--thanks to the hard work of so many of 
my colleagues here--and I am hopeful that today's hearing can serve as 
the starting point for further efforts to address important issues 
related to VA's benefit programs.
    Taking a look at the bigger picture, I would also like to note that 
the lack of adequate funding for personnel has significantly reduced 
the VBA's ability to provide benefits support and to process claims as 
quickly as veterans deserve. As this Committee has heard time and time 
again, shortfalls in the VA budget have led to personnel shortages and 
huge backlogs in the processing of benefits claims. Until we fix these 
funding issues, we cannot fully live up to our promises to provide our 
Nation's veterans with the benefits they have earned in a timely 
manner.
    Again, I thank all of the panelists who are here today, as well as 
my colleagues on both sides of the aisle who are working together to 
make sure our Nation's veterans can take advantage of the benefits they 
have earned. I look forward to joining you in this effort, and I am 
glad to be a part of this Committee's push for real results. At a time 
when Congress is struggling to convince the American people that it 
really is committed to addressing real issues and resolving real 
problems, this hearing is both reassuring and absolutely crucial.
    Thank you.

    Chairman Craig. Let us ask Ronald Aument, Deputy Under 
Secretary for Benefits, Department of Veterans Affairs, to come 
forward today. He is accompanied by John Thompson, Deputy 
General Counsel, Department of Veterans Affairs.
    Gentlemen, welcome before the Committee.

    STATEMENT OF RONALD AUMENT, DEPUTY UNDER SECRETARY FOR 
            BENEFITS, DEPARTMENT OF VETERANS AFFAIRS

    Mr. Aument. Mr. Chairman and Members of the Committee, 
thank you for the opportunity to testify today on a number of 
legislative items of great interest to veterans. I am joined at 
the witness table by John Thompson, Deputy General Counsel.
    With the Committee's permission, I will offer a summary 
statement this morning and request that my written testimony be 
submitted for the record.
    Chairman Craig. Your full testimony will be a part of the 
record. Thank you.
    Mr. Aument. Thank you, sir. I will proceed by discussing 
each of the bills in chronological order.
    S. 2121, the Veterans Housing Fairness Act of 2005, would 
authorize VA to guarantee loans for stock in certain 
developments, structures, or projects of a cooperative housing 
corporation. VA cannot support this bill because we do not 
believe that VA participation in co-ops would be in the best 
interest of the veteran or the Government as guarantor of the 
loan.
    Co-ops present significant risks to both the veteran and 
the VA. The buyer of a co-op does not acquire an interest in 
the real estate or obtain title to his or her dwelling unit. A 
responsible co-op owner could lose his or her interest in the 
co-op if the blanket mortgage for the entire property goes into 
foreclosure.
    Unlike other VA loans, there would be no lien on real 
property or tangible personal property. In addition, 
restrictions on sales imposed by some co-ops, which are not 
permitted under current VA regulations for conventional or 
condominium developments, are viewed as detrimental to the 
interest of the veteran.
    S. 2416, the Veterans Employment and Training Act of 2006, 
would expand the programs of education for which accelerated 
payment of educational assistance may be made under the Chapter 
30 Montgomery GI Bill program. VA supports S. 2416, subject to 
Congress' enactment of legislation offsetting the cost of the 
increased benefits.
    However, we believe there may be a more efficient way of 
achieving this objective. To facilitate the implementation of 
this legislation, it would be cleaner and more direct if the 
bill simply stated that all high cost, short-term courses were 
eligible for accelerated payment. As written, S. 2416 would 
exclude those individuals who are enrolled in an associate's or 
higher degree program, unless his or her program of education 
leads to employment in a high-tech occupation.
    We can see no sound public policy basis, from a veterans 
perspective, for making this distinction.
    S. 2562, the Veterans' Compensation Cost-of-Living 
Adjustment Act of 2006, would authorize a cost-of-living 
adjustment (COLA) in the rates of disability compensation and 
dependency and indemnity compensation, effective December 1, 
2006. We believe this COLA is necessary and appropriate to 
protect the benefits of affected veterans and their survivors 
from the eroding effects of inflation. These worthy 
beneficiaries deserve no less.
    S. 2659, the Native American Veterans Cemetery Act of 2006, 
would authorize the Secretary of Veterans Affairs to make 
grants to Native American tribal organizations to assist them 
in establishing, expanding, or improving veterans cemeteries on 
trust land in the same manner, and under the same conditions, 
as grants to States are made under 38 U.S.C. Section 2408. We 
strongly support enactment of this bill as a means of 
accommodating the burial needs of Native American veterans.
    S. 2694, the Veterans' Choice of Representation and 
Benefits Enhancement Act of 2006, would eliminate the current 
prohibition of charging fees for services of an agent or 
attorney provided before the Board of Veterans' Appeals makes 
its first final decision on the case. It would also authorize 
VA to restrict the amount of fees agents or attorneys may 
charge, and subject fee agreements between agents or attorneys 
and claimants to review by the Secretary, such review to be 
appealable to the Board.
    S. 2694 would also authorize VA to regulate the 
qualifications and standards of conduct applicable to agents 
and attorneys, add three grounds to the list of grounds for 
suspension or exclusion of agents or attorneys from further 
practice before VA, subject Veteran Service Organization 
representatives and individuals recognized for a particular 
claim to suspension on the same grounds as applied to agents 
and attorneys, and authorize VA to periodically collect 
registration fees from agents and attorneys to offset the costs 
of these regulatory activities.
    Under S. 2694, attorney fees would consume significant 
amounts of payments under the programs meant to benefit 
veterans and we believe that Congress should not enact this 
bill unless it becomes convinced that veterans would gain more 
in terms of increased benefits than they would lose to their 
attorneys. Available evidence shows that it is unlikely, hence 
we cannot support the bill's enactment.
    The expense of employing an attorney to obtain veterans 
benefits would largely appear to be unwarranted. As recognized 
by Congress, VSO representatives are a valued component of the 
VA adjudication system, providing assistance and guidance to 
claimants through the claims process without charge.
    Additionally, existing empirical data does not indicate 
that attorneys would provide service superior to that 
represented by VSO representatives. These facts alone cause us 
to doubt that participation by attorneys would gain claimants 
more in increased benefits than it would cost them in fees.
    VA assumes primary responsibility through statutory 
provisions and administrative procedures for leading the 
claimant through the administrative claims process. We are 
concerned that enactment of this bill would impede the Nation's 
paramount interest in promoting and maintaining an non-
adversarial adjudication process, as exemplified by the 
Veterans Claims Assistance Act of 2000.
    Introducing an attorney charged with a professional 
obligation to represent a client zealously within the bounds of 
the law would, in our view, inevitably make the process more 
adversarial. The result would almost certainly be to increase 
the time all veterans must wait for decisions in their claims.
    Finally, we cannot support S. 2694 because it would require 
creation of a substantial new bureaucracy to perform the 
additional accreditation and oversight responsibilities. VA 
would have to create procedures and standards for accrediting 
attorneys and for reviewing fee agreements for services 
performed at the regional offices, determining whether a fee 
charged by an agent or an attorney is excessive or 
unreasonable.
    The additional time and substantial resources would be 
better spent adjudicating the approximately 800,000 benefit 
claims that VA receives annually. A better alternative would be 
to have attorneys regulated by the States responsible for their 
licenses than to create a new Federal office to monitor 
attorney conduct.
    S. 3363 would provide for accelerated payment for survivors 
and benefits assistance for certain programs of education under 
Chapter 35 of Title 38. VA will provide its comments and costs 
on S. 3363 at a later time.
    Chairman Craig. This concludes my statement, Mr. Chairman. 
I would be happy to answer any questions that you or other 
Members of the Committee may have.
    [The prepared statement of Mr. Aument follows:]

    Prepared Statement of Ronald Aument, Deputy Under Secretary for 
                Benefits, Department of Veterans Affairs

    Mr. Chairman and Members of the Committee, thank you for the 
opportunity to testify today on a number of legislative items of great 
interest to veterans. I am joined at the witness table by John H. 
Thompson, Deputy General Counsel.
                                s. 2121
    S. 2121, the ``Veterans Housing Fairness Act of 2005,'' would 
authorize VA to guarantee loans for stock in certain developments, 
structures, or projects of a cooperative housing corporation (co-ops).
    VA cannot support this bill because we do not believe that VA 
participation in co-ops would be in the best interest of the veteran or 
of the Government as guarantor of the loan. Under current law, a 
veteran may purchase a conventional home, a condominium unit, or a 
manufactured home and a manufactured home lot. In all cases except a 
manufactured home, the veteran is purchasing real property. Although 
the manufactured home is normally considered personal property, the 
veteran also obtains title to the actual home he or she will be 
occupying. In contrast, the buyer of a co-op does not acquire an 
interest in real estate or obtain title to his or her dwelling unit. 
Instead, the purchaser acquires personal property in the form of a 
share of the cooperative's stock, coupled with the right to occupy a 
particular apartment in the building. A buyer normally obtains a share 
loan that finances the purchase of an ownership interest in the co-op. 
This loan is evidenced by a promissory note and is secured by a pledge 
of the stock, shares, membership certificate, or other contractual 
agreement that evidences ownership in the corporation and by an 
assignment of the proprietary lease or occupancy agreement. VA would be 
guaranteeing this corporate share loan. Unlike other VA loans, there 
would be no lien on real property or tangible personal property.
    Cooperative housing projects are usually subject to blanket 
mortgages. This is a matter of great concern because of the significant 
risk to which the buyer, the loan holder, and VA are exposed. The buyer 
of a co-op is responsible for the monthly payment on the share loan as 
well as the assessments levied by the corporation, which can be 
significant. The survival of the project may depend upon each member of 
the co-op meeting his or her obligations. Failure to do that could lead 
to foreclosure of the blanket mortgage on the entire building. Such 
foreclosure would wipe out any interest individual co-op owners, even 
owners who are timely in the payment of their share loans, may have in 
the project since they have no interest in real property. It would also 
leave the holder of the share loan without any security. This is what 
principally sets co-ops apart from condominiums.
    Many co-ops also retain a right of first refusal or a right by the 
co-op board to approve or reject a prospective buyer. Rights of first 
refusal are not permitted by VA regulation, 38 CFR Sec. 36.4350, and VA 
does not participate in projects that have them. We believe that the 
issue of right of first refusal alone would disqualify most projects 
from VA eligibility.
    We understand that some co-op projects impose other restrictions on 
sales, such as imposing a fee when the owner sells his or her unit to 
someone other than the corporation, or granting the exclusive right to 
sell units to a particular real estate broker, often at a higher 
commission. These and similar practices would be viewed as detrimental 
to the interests of veterans and, therefore, not permitted under 
current VA regulations for conventional or condominium developments. 
These practices could also adversely affect the marketability of a 
unit. If a veteran-borrower is experiencing financial difficulties and 
cannot freely dispose of his or her unit at an advantageous price, 
foreclosure with a resultant loss to VA is more likely.
    We also understand that conventional lenders, as well as the 
secondary mortgage market agencies, generally have additional 
underwriting and project requirements for co-ops because of the 
additional risks they present. In addition, valuation of these 
properties would be very complicated because of the blanket mortgage.
    Costs associated with this legislation would likely be 
insignificant compared to the overall VA guaranteed loan portfolio.
                                s. 2416
    S. 2416, the ``Veterans Employment and Training Act of 2006,'' 
would expand the programs of education for which accelerated payment of 
educational assistance may be made under the chapter 30 Montgomery GI 
Bill (MGIB) program. Specifically, this measure would permit 
accelerated payment of the basic educational assistance allowance to 
veterans pursuing an approved program of education (in addition to the 
programs now authorized such payment) lasting less than 2 years and 
leading to employment in a sector of the economy that is projected to 
experience substantial job growth, positively affects the growth of 
another sector of the economy, or consists of existing or emerging 
businesses that are being changed by technology and innovation and 
require new skills for workers, as determined by the Department of 
Labor (DOL).
    Under current law, only an MGIB participant pursuing high cost 
courses leading to employment in a high technology occupation in a high 
technology industry has the option of receiving an accelerated benefit 
payment. This optional lump-sum accelerated benefit payment may cover 
up to 60 percent of the cost of such a course, provided the pro-rated 
course costs exceed 200 percent of the applicable monthly MGIB rate. 
The lump-sum payment is deducted from the veteran's MGIB entitlement 
balance in the same manner as if paid on a monthly basis and may not 
exceed that balance.
    In addition, S. 2416 specifically states that, for purposes of 
accelerated payment of educational assistance, the term ``program of 
education'' would include such a program pursued at a tribally 
controlled college or university (as defined in the Tribally Controlled 
College or University Assistance Act of 1978).
    VA supports S. 2416, subject to Congress' enactment of legislation 
offsetting the cost of the increased benefits. However, as discussed 
below, we believe there may be a more efficient way of achieving its 
objective.
    We note that implementation would be challenging for VA. The DOL 
employment projections change every 2 years. In addition, depending on 
the definition of ``sector,'' it is possible that almost all programs 
would lead to employment in one sector of the economy that would affect 
at least one other sector positively. It would be cleaner and more 
direct if the bill simply stated that all high-cost short-term courses 
were eligible for accelerated payment. Second, S. 2416 would exclude 
from the proposed expansion of accelerated payment eligibility those 
individuals who are enrolled in an associate's or higher degree 
program. Thus, such an individual only could receive an accelerated 
payment if his or her program of education leads to employment in a 
high technology occupation in a high technology industry (as determined 
by VA). We can see no sound public policy basis for making this 
distinction.
    Concerning the bill's express provision for accelerated payments 
under chapter 30 to eligible veterans pursuing a program of education 
at a tribally controlled college or university, VA has no objection. We 
note, however, that VA currently considers such programs to be 
``programs of education'' for MGIB purposes, and we are not aware of 
any situations pertaining to servicemembers or veterans attending 
tribally controlled colleges or universities that adversely affect 
their eligibility for accelerated benefit payments.
    VA estimates S. 2416, if enacted, would cost $11.5 million during 
fiscal year 2007 and approximately $121.6 million over the period 
fiscal years 2007-2016. The estimates for the years following fiscal 
year 2007 would need to be reassessed annually due to DOL initiative 
changes.
                                s. 2562
    S. 2562, the ``Veterans' Compensation Cost-of-Living Adjustment Act 
of 2006,'' would authorize a cost-of-living adjustment (COLA) in the 
rates of disability compensation and dependency and indemnity 
compensation (DIC). This bill would direct the Secretary of Veterans 
Affairs to increase administratively the rates of compensation for 
service-disabled veterans and of DIC for the survivors of veterans 
whose deaths are service related, effective December 1, 2006. 
Consistent with the President's fiscal year 2007 budget request, the 
rate of increase would be the same as the COLA that will be provided 
under current law to veterans' pension and Social Security recipients, 
which is currently estimated to be 2.6 percent. We believe this COLA is 
necessary and appropriate to protect the benefits of affected veterans 
and their survivors from the eroding effects of inflation. These worthy 
beneficiaries deserve no less.
    We estimate that enactment of this bill would cost $590.3 million 
during fiscal year 2007, $3.7 billion over the 5-year period fiscal 
year 2007 through fiscal year 2011, and $8.2 billion over the 10-year 
period fiscal year 2007 through fiscal year 2016. However, the cost is 
already assumed in the budget baseline, and, therefore, enactment of 
this provision would not result in any additional cost.
                                s. 2659
    S. 2659, the ``Native American Veterans Cemetery Act of 2006,'' 
would authorize the Secretary of Veterans Affairs to make grants to 
Native American tribal organizations to assist them in establishing, 
expanding, or improving veterans' cemeteries on trust lands in the same 
manner and under the same conditions as grants to states are made under 
38 U.S.C. 2408. We strongly support enactment of this bill.
    The cemetery grants program has proven to be an effective way of 
making the option of veterans cemetery burial available in locations 
not conveniently served by our national cemeteries. S. 2659 would 
create another means of accommodating the burial needs of Native 
American veterans who wish to be buried in tribal lands.
                                s. 2694
    S. 2694, the ``Veterans' Choice of Representation Act of 2006,'' 
would eliminate the current prohibition on the charging of fees for 
services of an agent or attorney provided before the Board of Veterans' 
Appeals (Board) makes its first final decision in the case. It would 
also authorize VA to restrict the amount of fees agents or attorneys 
may charge and subject fee agreements between agents or attorneys and 
claimants to review by the Secretary, such review to be appealable to 
the Board. In addition, it would eliminate fee matters as grounds for 
criminal penalties under 38 U.S.C. 5905.
    S. 2694 would also authorize VA to regulate the qualifications and 
standards of conduct applicable to agents and attorneys, add three 
grounds to the list of grounds for suspension or exclusion of agents or 
attorneys from further practice before VA, subject VSO representatives 
and individuals recognized for a particular claim to suspension on the 
same grounds as apply to agents and attorneys, and authorize VA to 
periodically collect registration fees from agents and attorneys to 
offset the cost of these regulatory activities.
    We understand, and in fact agree with, the argument that veterans 
are as capable as anyone of deciding whether to employ attorneys on 
their behalves. However, that is not the issue. The Government has an 
obligation to ensure that veterans derive maximum value from taxpayer-
supported VA programs. This Committee expressed its concern in 1988 
when it reported out a bill (S. 11, 100th Cong.) that would have 
retained the prior $10 limitation on fees for claims resolved before or 
in the first Board decision, that any changes relating to attorneys' 
fees ``be made carefully so as not to induce unnecessary retention of 
attorneys by VA claimants.'' Under S. 2694, attorney fees would consume 
significant amounts of payments under programs meant to benefit 
veterans, and Congress should not enact this bill unless it becomes 
convinced veterans would gain more in terms of increased benefits than 
they would lose to their attorneys. Available evidence shows that is 
unlikely, hence we cannot support the bill's enactment.
    Throughout the years, Congress has recognized, correctly, that 
integration of VSO representatives into the process of developing and 
deciding claims is one of the most valuable features of the VA 
adjudication system. These representatives are available to guide 
through the claims process all claimants who seek their assistance, 
without charge. VSO representatives are well-versed in veterans 
benefits law as a result of the training they receive and therefore are 
well-equipped to successfully assist claimants throughout the 
administrative processing of their claims. Further, VSOs must certify 
to VA that their representatives are fully qualified to represent 
claimants. These facts alone cause us to doubt that participation by 
attorneys would gain claimants more in increased benefits than it would 
cost them in fees.
    Moreover, what empirical data exist do not indicate attorneys would 
provide service superior to that rendered by VSO representatives. For 
example, in fiscal year 2005, 7.5 percent of appellants before the 
Board of Veterans' Appeals were represented by attorneys, and 
approximately 80 percent were represented by VSOs. Approximately the 
same percentage of claims was granted in matters appealed to the Board 
whether a claimant was represented by a VSO representative or was 
represented by an attorney. In fiscal year 2005, the Board granted one 
or more of the benefits sought in 21.3 percent of the appeals in which 
a claimant was represented by an attorney. The Board granted one or 
more of the benefits sought in 22.3 percent of the cases in which a 
claimant was represented by a VSO.
    The expense of employing an attorney to obtain veterans benefits 
would appear to be largely unwarranted. For example, many claims are 
granted immediately by VA based on a presumption of service connection 
or incurrence of an injury or disease during service. VA currently has 
presumptions of service connection for several different kinds of 
service and many diseases. For example, a Vietnam veteran is entitled 
to a presumption of service connection if he or she develops diabetes 
mellitus (Type 2). Giving VA an opportunity to decide such a claim 
without attorney involvement may well save a veteran money. In 
addition, claimants do not appeal to the Board in about 90 percent of 
claims decided by VA regional offices, suggesting a high level of 
satisfaction with the regional offices' decisions in their cases. 
Paying an attorney to assist in presenting these claims would seem to 
be a waste of claimants' financial resources.
    Also, as this Committee recognized in 1988 when it reported out S. 
11, there is ``no compelling justification'' for hiring an attorney 
prior to that point. The Supreme Court recognized in Walters v. 
National Ass'n of Radiation Survivors that, ``[a]s might be expected in 
a system which processes such a large number of claims each year, the 
process prescribed by Congress for obtaining disability benefits does 
not contemplate the adversary mode of dispute resolution.'' Rather, the 
Supreme Court said, ``The process is designed to function throughout 
with a high degree of informality and solicitude for the claimant.''
    All a claimant need do is file a claim, and VA will notify the 
claimant of the information and evidence necessary to substantiate the 
claim, assist the claimant in obtaining relevant Government and private 
records, provide a medical examination or obtain a medical opinion when 
necessary to decide a compensation claim, and make an initial decision 
on the claim. If a claim is denied, all a claimant need do to initiate 
an appeal to the Board is to write VA expressing dissatisfaction or 
disagreement with the decision and a desire to contest the result. The 
VA agency that made the original decision on the claim will develop or 
review the claim in a final attempt to resolve the disagreement and 
issue a statement of the case if the disagreement is not resolved. VA 
assumes primary responsibility for leading a claimant through the 
administrative claims process, making the expenditure of a claimant's 
limited financial resources on an attorney unnecessary. Furthermore, we 
are concerned that enactment of this bill would impede the Government's 
paramount interest in promoting and maintaining a non-adversarial 
adjudicative process, as exemplified by the Veterans Claims Assistance 
Act of 2000 requiring VA to notify a claimant of the information and 
evidence necessary to substantiate a claim and to assist a claimant in 
obtaining such evidence. This statute was designed to facilitate 
beneficial interaction between claimants and VA during the initial 
adjudication process. S. 2694, by permitting claimants to employ paid 
attorneys before issuance of the first final Board decision, would be 
incongruent with the beneficent VA system that Congress has nurtured 
over the decades.
    Also, attorney-represented claimants would lose certain benefits of 
the current non-adversarial system. For example, the Court of Appeals 
for the Federal Circuit recently held in Andrews v. Nicholson that VA 
must sympathetically read all pro se pleadings, including a pro se 
motion alleging clear and unmistakable error (CUE) in a VA decision. 
However, the court stated in Andrews and in Johnston v. Nicholson that 
VA is not obligated to sympathetically read pleadings filed by counsel, 
and the failure to raise an issue in a CUE motion filed by counsel 
before the Board is fatal to subsequently raising the issue before the 
Court of Appeals for Veterans Claims.
    S. 2694 would attempt to maintain the non-adversarial nature of the 
process by authorizing VA to suspend claim representatives who fail to 
conduct themselves ``with due regard for the non-adversarial nature 
of'' VA proceedings. However, a requirement for non-adversarial conduct 
by an attorney appears inconsistent with an attorney's professional 
responsibility to ``represent a client zealously within the bounds of 
the law.'' Model Code Of Prof'l Responsibility Canon 7 (1983). ``While 
serving as advocate, a lawyer should resolve in favor of his client 
doubts as to the bounds of the law'' and may urge any permissible 
construction of the law favorable to his client. Model Code Of Prof'l 
Responsibility EC7-3 and 7-4 (1983). An attorney who ``appear[s] before 
an administrative agency, regardless of the nature of the proceeding it 
is conducting, has the continuing duty to advance the cause of his 
client within the bounds of the law.'' Model Code Of Prof'l 
Responsibility EC7-15. Introducing an attorney charged with such 
professional obligations into the non-adversarial claims process from 
its initial stages would, in our view, inevitably make the process more 
adversarial, which we believe would harm the interests of VA claimants. 
Further, if S. 2694 were enacted, VA would likely have to hire 
attorneys to work in its Regional Offices to respond to the legal 
pleadings filed by attorneys in support of their clients' claims. 
However unintentional it would be, we predict the process would 
inevitably become more formal and brief driven, to the point claimants 
may feel they must hire attorneys to establish entitlement to their 
benefits. The result would almost certainly be to increase the time all 
veterans must wait for decisions in their claims.
    Finally, we cannot support S. 2694 because it would require 
creation of a substantial new bureaucracy to perform the additional 
accreditation and oversight responsibilities. Currently, an attorney in 
good standing with the bar of any state may represent a claimant before 
VA if the attorney states in a signed writing on his or her letterhead 
that he or she is authorized to represent the claimant. If S. 2694 were 
enacted, VA would have to create procedures and standards for 
accrediting attorneys and for reviewing fee agreements for services 
performed at the ROs to determine whether a fee charged by an agent or 
attorney is ``excessive or unreasonable.'' The additional time and 
substantial resources that would be required to carry out the 
accreditation process and review fee agreements for work performed 
before the ROs would, in our view, be better spent adjudicating the 
approximately 800,000 benefit claims that VA receives annually.
    Moreover, attorneys are licensed by the various states, which are 
responsible for regulating their conduct and disciplining them if they 
overreach with respect to fees charged. If attorneys are permitted to 
practice before the Department and charge fees for their services, it 
would be far better to have them regulated by the states responsible 
for their licenses than to create a new Federal office to monitor 
attorney conduct.
                                s. 3363
    S. 3363 would provide for accelerated payment of survivors' and 
dependents' educational assistance for certain programs of education 
under chapter 35 of title 38, United States Code.
    VA will provide its comments and costs on S. 3363 at a later time.
    That concludes my statement, Mr. Chairman. I would be happy now to 
entertain any questions you or the other Members of the Committee may 
have.
                                 ______
                                 
   Response to Written Questions Submitted by Hon. Larry E. Craig to 
                             Ronald Aument

    Question 1. In addition to giving veterans the right to hire 
attorneys, S. 2694 would give the Department of Veterans Affairs (VA) 
authority to require attorneys to have minimum levels of experience and 
specialized training; to require attorneys to follow standards of 
conduct specified by VA; to set restrictions on the amount of fees that 
attorneys may charge; to suspend any representative from practicing 
before VA who fails to comply with any conditions specified by the 
Secretary; and to reduce any attorney fee that is excessive or 
unreasonable. Would those additional authorities allow VA to prevent 
the potential problems you mentioned in your testimony? If not, what 
authorities would VA need?
    Answer. The additional authorities listed in Question 1, all of 
which concern the accreditation and oversight of attorneys, do not 
address the concerns expressed in the Department of Veterans Affairs' 
(VA) hearing statement. VA has indicated that it opposes S. 2694 
because attorney fees would needlessly deplete claimants' benefits or 
financial resources, not because attorneys generally lack the requisite 
character and competence to represent veterans. Under S. 2694, VA would 
be authorized to prevent attorneys from charging unreasonable fees. 
However, even in the case of reasonable fees, the claimant's benefits 
or financial resources would be diminished by the amount of the fees, 
and available data indicates that it is unlikely that claimants would 
gain more in terms of increased benefits than they would lose in 
payment of fees to attorneys.
    Further, VA has indicated that it opposes S. 2694 because 
introduction of attorneys into VA adjudication proceedings would 
undermine the current non-adversarial nature of the system. The bill 
would allow claimants to pay attorneys for their representational 
services during proceedings before the Department, but would require 
non-adversarial conduct by attorneys in VA proceedings. We explained in 
our hearing statement that attorneys are ethically bound to represent 
their clients ``zealously within the bounds of the law.'' Model Code Of 
Prof'l Responsibility Canon 7 (1983). Introducing an attorney charged 
with such professional obligations into the non-adversarial claims 
process from its initial stages would, in our view, inevitably make the 
process more adversarial, which we believe would harm the interests of 
VA claimants. Further, if S. 2694 were enacted, VA would likely have to 
hire attorneys to work in its regional offices (ROs) to respond to the 
legal pleadings filed by attorneys in support of their clients' claims. 
However unintentional it would be, we predict the process would 
inevitably become more formal and brief driven, to the point claimants 
may feel they must hire attorneys to establish entitlement to their 
benefits. The result would almost certainly be to increase the time all 
veterans must wait for decisions in their claims. These problems would 
not be alleviated by additional regulatory authority.
    VA has also indicated that it opposes the provisions of the bill 
that would require VA regulation of attorney qualifications. Currently, 
an attorney in good standing with the bar of any state may represent a 
claimant before VA if the attorney states in a signed writing on his or 
her letterhead that he or she is authorized to represent the claimant. 
If S. 2694 were enacted, VA would have to create procedures and 
standards for accrediting attorneys and for reviewing fee agreements 
for services performed at ROs to determine whether a fee charged by an 
agent or attorney is ``excessive or unreasonable.'' The additional time 
and substantial resources that would be required to carry out the 
accreditation process and review fee agreements for work performed 
before the ROs would, in our view, be better spent adjudicating the 
approximately 800,000 benefit claims that VA receives annually.
    Moreover, attorneys are licensed by the various states, which are 
responsible for regulating their conduct and disciplining them if they 
overreach with respect to fees charged. If attorneys are permitted to 
practice before the Department and charge fees for their services, it 
would be far better to have them regulated by the states responsible 
for their licenses than to create a new Federal office to monitor 
attorney conduct. VA opposes imposing this task on VA because it would 
necessitate creation of a substantial new bureaucracy to perform the 
additional accreditation and oversight responsibilities.
    Provision of additional regulatory authority would not address 
these concerns. Thus, the only suggestion that VA can offer to avoid 
the problems that we believe would be associated with enactment of S. 
2694 with regard to regulation of attorneys is to delete the attorney-
regulation provisions in the bill.
    Question 2. One provision of S. 2694 would allow VA to suspend 
attorneys from practicing before VA if they fail to show ``due regard 
for the non-adversarial nature of the system.'' This provision was 
intended to give VA redress against an attorney who attempts to use 
aggressive litigation techniques to overwhelm or confuse regional 
office adjudicators. If the current language does not accomplish that 
objective, what language would?
    Answer. As explained in our response to Question 1, attorneys are 
ethically bound to represent their clients ``zealously within the 
bounds of the law.'' Model Code Of Prof'l Responsibility Canon 7 
(1983). Introducing an attorney charged with such professional 
obligations into the non-adversarial claims process from its initial 
stages would, in our view, inevitably make the process more 
adversarial, which we believe would harm the interests of VA claimants. 
The result would almost certainly be to increase the time all veterans 
must wait for decisions in their claims. We do not believe that the 
attorney-regulation provisions of the bill will protect the non-
adversarial nature of the VA system and suggest that those provisions 
be deleted.
    Question 3. As drafted, S. 2694 would give VA a 6-month window to 
promulgate any necessary regulations to implement the legislation. If 
this bill is enacted substantially in its current form, would 6 months 
be sufficient time for VA to promulgate any necessary regulations? If 
not, what would you estimate to be an appropriate amount of time?
    Answer. If S. 2694 were revised to delete the attorney-regulation 
provisions, we believe it would be possible for VA to promulgate 
implementing regulations within 6 months.
    Question 4. If S. 2694 were to become law, it would allow veterans 
to hire attorneys with regard to any claims filed 6 months or more 
after enactment. This delayed and staggered effective date was intended 
to allow a deliberate and gradual implementation of this policy. Yet, 
some have recommended that the prohibition on attorneys be lifted on 
the bill's day of enactment for all pending and future claims. If this 
bill were to be enacted into law, how would you recommend structuring 
the effective date?
    Answer. A delayed effective date would be necessary if Congress 
enacts S. 2694 as currently drafted, as lengthy rulemaking proceedings 
would be needed to implement the legislation. Regulations would need to 
be in place to implement the bill's requirements for VA recognition of 
attorneys, regulation of fees, and collection of registration fees.

    Chairman Craig. Ron, thank you again for being with us. I 
must tell you, I find your testimony in relation to S. 2694 
interesting. I guess that is one way of saying it.
    In this country, I think we are proud to refer to this as 
the land of the free. Would you not agree that personal freedom 
should at least be one of the factors, if not the most 
important factor, in considering whether the current law should 
be changed?
    Mr. Aument. We certainly have no opposition to this 
legislation on any philosophical grounds whatsoever, Mr. 
Chairman. Our position is more of an empirical one. As we said 
before, the available data suggests today that claimants, 
veterans represented by attorneys, do not fare any better than 
claimants that are represented by the Veterans Service 
Organizations at the initial claim level.
    Therefore, we do not see that there is going to be any 
benefit to veterans, but certainly there are going to be 
expenses.
    Chairman Craig. If I correctly understand your testimony, 
the Administration's position is that no veteran should have 
the option of hiring an attorney because you think the expense 
of employing an attorney would appear to be largely 
unwarranted.
    Mr. Aument. That is correct, sir.
    Chairman Craig. How is it possible for you to draw that 
conclusion without knowing how complicated a particular 
veteran's case may be, without knowing what type and what 
amount of benefits the veteran eventually would win, without 
knowing the veteran's financial situation, and without knowing 
how much the attorney would charge?
    Mr. Aument. Sir, we can only look at the data that we have 
available today. And today, of course, attorneys can represent 
veterans both at a regional and appellate levels, only they are 
subject to the existing statutory fee restrictions.
    There is a fairly busy attorney practice----
    Senator Isakson. Mr. Chairman, what is that fee? I hate to 
interrupt.
    Chairman Craig. I do not know.
    Mr. Aument. It is $10.
    Mr. Thompson. No. It is no longer $10. No fee.
    Chairman Craig. There is no fee requirement now, is there?
    Mr. Thompson. No fee is permitted at the administrative 
stage.
    Chairman Craig. Thank you.
    Mr. Aument. I stand corrected on that, sir. But, again, the 
empirical evidence at the Board of Veterans' Appeals level 
showed that veterans represented by attorneys fare no better 
than veterans represented by Veterans Service Organizations.
    Similarly, at the VBA level, we find the same results.
    Chairman Craig. Given these variables, wouldn't it be 
better to allow each individual veteran to decide, based on the 
circumstances of his or her case, whether hiring an attorney 
would be appropriate?
    Mr. Aument. I will repeat, sir, from a philosophical 
ground, we have no opposition whatsoever. Our main concern is 
for the benefits of the veterans and the issue of unintended 
consequences.
    Chairman Craig. Phenomenal parental attitude, is it not?
    Mr. Aument. That is----
    Chairman Craig. Given your concession that veterans are 
indeed capable of deciding whether to hire attorneys, I am 
perplexed at your position that we nevertheless should not 
allow veterans to make these decisions because they might end 
up wasting financial resources.
    Is that testimony meant to suggest that veterans are not 
capable of making wise decisions in hiring attorneys?
    Mr. Aument. Certainly not, sir.
    In no way, shape, or form, would I ever want to imply that. 
As I said before, from a conceptual level, we have no 
opposition to this. One of our main concerns is the issue of 
unintended consequences. When you have an entire system that 
has been constructed around the philosophy of a non-adversarial 
system.
    It is already taking us, in our view, too long to process 
the claims that we receive today with the growing backlog. We 
are very concerned that with the insertion of this new 
phenomena into the system, it is going to only worsen.
    Chairman Craig. I will conclude this first round of 
questioning because I think there is more to be brought out 
here. In a non-adversarial environment that was once relatively 
simple, we now have a phenomenally complicated process to work 
our way through. That complication in itself becomes 
adversarial in many instances.
    With that, let me turn to our colleagues. I see Senator 
Thune has joined us. I will turn to him in a moment.
    Let me turn to Senator Graham first. Lindsey.
    Senator Graham. Mr. Chairman, I find the Administration's 
position on this is breathtakingly bad. You are telling every 
veteran in the country you have looked at their needs and you 
have decided they do not need a lawyer because, at the end, it 
is not worth it for them. Is that right?
    Mr. Aument. In part, Senator----
    Senator Graham. You put our democratic friends to shame, in 
terms of what they would like to do for the country. I mean, I 
am sitting here, and this Republican Administration is telling 
every veteran in the land we have done an economic analysis of 
the legal right you may have, and we have decided you do not 
need. Other than that, I have got no problem with your 
position.
    [Laughter.]
    Senator Graham. Now, Social Security, is there an economic 
benefit to having legal representation to get your Social 
Security benefits?
    Mr. Aument. I am not an expert on Social Security, sir.
    Senator Graham. I think we should be as equally protective 
of the Social Security to the disabled population. I would hope 
the Administration would look at the Social Security system and 
see whether or not legal representation benefits the people who 
are applying and that have been denied claims.
    The bottom line is, Mr. Chairman, you are right. The VSO is 
out there--God bless you. You are doing a great job. You do it 
for free and I appreciate you helping our veterans. Sometimes 
these cases get to be complex. They are very complex.
    I would just like to reiterate that if there is a willing 
client and willing lawyer to have a relationship formed to help 
that veteran and the fees will be looked at by the Veterans' 
Administration, just like they are at the Social Security 
Administration. We are going to regulate who can do this, so 
that people do not get taken advantage of.
    I think in today's world, 2006, with a bunch of people 
coming back from Iraq and Afghanistan with the benefits 
changing everyday, if you can understand that you are better 
than I am, Ron, I cannot understand it all. The idea that a 
lawyer could be helpful should be interjected into this system 
and we will regulate how that happens. But I just find it 
incredibly misguided to say that the executive branch of our 
Government is going to make that decision for every veteran in 
the country who may need some help beyond what the VSOs can 
provide.
    I know it works in Social Security. I can assure you, 
having been a lawyer, that there are many cases where the legal 
representation of that Social Security beneficiary made all the 
difference in the world. And I am totally confident it would 
make all the difference in the world to veterans out there who 
are lost in a bureaucracy of well-meaning people. But it is a 
bureaucracy that is getting more complex by the day because the 
benefit packages are getting more complex by the day.
    I see some veterans shaking their heads. I hope we can give 
you the right, if you choose to exercise it, to get a lawyer to 
go in there and fight for you. Thank you, Mr. Chairman.
    Chairman Craig. Thank you, Senator.
    Senator Isakson.
    Senator Isakson. Currently a veteran cannot bring a lawyer 
at any phase of an issue before the VA?
    Mr. Aument. They cannot pay a lawyer a fee. Until the 
veteran has received his first decision of denial at the 
appellate level with the Board of Veterans' Appeals.
    Senator Isakson. If that is the case, how can you say based 
on your experience, that they would not gain any benefit? I 
mean, if they are not allowed to, then you do not have any 
experience where they have engaged a lawyer to help them.
    Mr. Aument. We do, sir. Because there are many veterans 
that are represented by attorneys on a pro bono basis, we do 
have that empirical data, both at the VBA and the Board of 
Veterans' Appeals level.
    Senator Isakson. I will yield to Senator Graham for a 
second.
    Senator Graham. The only time you are allowed legal 
representation is once you have been denied your initial claim, 
is that correct?
    Mr. Aument. On a fee basis.
    Senator Graham. Right. Basically, not being able to hire a 
lawyer, you have got a de facto bar, because the lawyer cannot 
get compensated for their time.
    At the appeals level, can you submit new matters?
    Mr. Aument. Yes.
    Senator Graham. You can?
    Mr. Aument. At the appeals level, you say, can new evidence 
be introduced?
    Senator Graham. Yes.
    Mr. Aument. It can be introduced anywhere in the process.
    Senator Graham. Is it an adversarial situation at the 
appeals level?
    Mr. Aument. I would say no, it is not.
    Senator Graham. By the time you have been denied, your 
initial denial had without representation.
    Mr. Aument. Not necessarily.
    Senator Graham. You cannot pay a lawyer. Unless every 
lawyer in the country wants to do it for free.
    Mr. Aument. That does not mean that they are unrepresented. 
They may have been represented by a VSO or by a pro bono 
attorney.
    Senator Graham. I do not mean to take your time, but the 
rules right now that you are not going--lawyers have to make a 
living like everybody else. If you cannot hire a lawyer at the 
initial stage, once you lose the case, it is very hard to 
change the outcome.
    In effect, what you are doing is you are letting a lawyer 
come in at a time when a veteran is at his weakest, not at his 
strongest. I think that is equally bad.
    Chairman Craig. Senator Isakson.
    Senator Isakson. I reclaim my time.
    First of all, I am not a lawyer.
    Secondly, I am like most Americans--everybody hates lawyers 
but loves their lawyers.
    Senator Graham. Right.
    Senator Isakson. I mean, that is kind of like Congress. 
Everybody hates Congress but loves their Congressman. And I 
think----
    Chairman Craig. At least we hope the latter is true.
    [Laughter.]
    Senator Isakson [continuing.] That we hope the latter is 
true. That is right.
    But I think that is, although humorous, also pretty much 
fair. In this situation where you have a right, or believe you 
have a right or a benefit to say that you do not have a right 
to representation until some stage down the process, to me, 
just does not seem right.
    I have great regard for the VSOs and the services they 
provide and I have read some of the testimony in here where 
they have expressed some opposition, Mr. Chairman. But in 
analyzing it, as one who is not an attorney and does not have a 
dog in the fight economically, I would guess you would say, 
looking at the benefit, it would seem only right to me that a 
veteran have the option to have that.
    I do not think you can say evidence proves they would not 
gain any benefit if, in fact, that evidence now is tangential 
at best. Certainly not with the practice of choice being a 
reality.
    With that, I will yield back the balance of my time.
    Chairman Craig. Thank you, Senator. We have been joined by 
Senator Patty Murray.
    Senator Murray, do you have any opening statement and/or 
questions of this panel?

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

    Senator Murray. I just have a couple of comments. I know we 
are going to have a vote here in a minute. Let me just thank 
you for having this hearing. I know Senator Akaka was not able 
to come.
    Chairman Craig. Yes.
    Senator Murray. He is on the floor. I just want to mention 
his important piece of legislation, the Native American 
Veterans Cemetery Act of 2006, and I really appreciate his 
leadership on that and I commend him for working on that.
    I just want to say that I am really disappointed that the 
Committee is not going to bring S. 2147. That is a bill that 
will help our veterans get treatment for Multiple Sclerosis. 
The bill would eliminate the arbitrary 7-year presumptive 
period for veterans diagnosed with MS.
    As many of our colleagues know, a lot of our servicemen and 
women who served, especially in the Gulf War, are being 
diagnosed with MS. It is a very difficult disease to diagnose. 
I know this because my father had MS and was a veteran. It is a 
disease that you do not necessarily diagnose correctly within 
the first 7 years. We have this arbitrary decision today that 
if you have not been diagnosed by 7 years, you arbitrarily do 
not get benefits. Because of the difficulty of diagnosing this 
disease, I would really hope, Mr. Chairman, that we could move 
on that piece of legislation. I hope we can work on that in the 
future.
    And, while I have a moment, I just also want to mention 
that, like everyone in this room, I hope we can really focus in 
this Committee on some of the things we need to do for our 
veterans. Mr. Chairman, you worked with us last year, and I 
know you care deeply about this. You have provided the 
leadership, but I am, again, really concerned that we are not 
going to have the resources that we need for our veterans.
    I talked to many of our Iraq veterans who come home and 
cannot find a job and are having a hard time transitioning back 
to civilian life. Many of them are having to wait a year or 
even 18 months to get the benefits that they need or to get the 
health care that they are seeking. I think we have a real 
challenge out there that we need to address.
    I just listened to the exchange about the Chairman's bill 
and making sure veterans have access to legal counsel and not 
being able to do it because we do not have the resources. All 
of this, I think, points to some serious concerns that we have 
got to have a realistic assessment on. In fact, in March, 
before the Military Construction Veterans Appropriation 
Committee, the VA told us that they are seeing 38 percent more 
Iraqi War veterans than they budgeted for. And in fiscal year 
2006, the VA expected to provide medical care to 110,000, but 
that number is now estimated to be closer to 170,000.
    I hope that we can really take a good look at these numbers 
and assess where we are. I know that we are hearing, even from 
the VA Under Secretary for Health Policy Coordination, that 
waiting lists render mental health and substance abuse care 
virtually impossible across our country.
    Mr. Chairman, it just all adds up to my continual concern 
that we have asked these men and women to serve overseas, and 
yet when they come home they are facing really a difficult time 
getting in and getting care, getting their benefits and 
transitioning back to the world. I know you know this, but I 
hope that we can focus on that.
    Finally, let me just mention, now learning that the VA data 
theft that occurred May 5th, more than a month ago, now--and 
details are still trickling out that 2.2 million 
servicemembers, including Guard and Reservists also lost their 
ID. That is going to have a financial impact on the VA as they 
notify these veterans.
    We have got to do this right. We have got to make sure that 
they are notified, that they get the help and support they need 
to make sure that their ID is not misused, or, if it is, that 
they get taken care of quickly.
    It is a responsibility we now incur because it was our VA 
that lost the IDs, and we know that is going to cost something. 
We have got to make sure that we pay that, but we do not want 
to take it out of the health care or the access for our current 
veterans.
    It is a challenge in front of us and I hope that we can 
spend some time dealing with that. Thank you, Mr. Chairman.
    Chairman Craig. Senator, I appreciate your sensitivity to 
these issues. With your help, we are going to continue to be 
monitoring all of this very, very closely so that, certainly as 
it relates to the latter portion of your statement, that any of 
those new costs and additional costs to protect our veterans 
and their IDs and their financial wholeness are not going to 
come out of health care. Period. End of statement. That just 
will not happen. We will not allow that to happen. And it is my 
clear understanding that neither will this Administration or 
the VA.
    If it is going to take additional resources, then that is 
going to be our job to get them.
    Senator Murray. If I could just ask, Mr. Chairman, do we 
have any assessment from the VA on when they will provide us an 
estimate on the cost of dealing with this?
    Chairman Craig. I am dialoguing with the Secretary, now. I 
anticipate that we will have the estimate probably before the 
Committee meets again, within a couple of weeks--to see where 
they are and what the costs are going to be, and how they are 
reaching out and will continue to reach out to veterans that 
may have been affected by this. We do not know that, yet. But 
certainly that liability and responsibility is there. We will 
stay very current on it.
    Senator Murray. Thank you very much.
    Chairman Craig. Thank you very much.
    Ron, in your testimony, you suggest that veterans should 
not be permitted to hire attorneys to navigate the VA system. 
Several years ago, an Under Secretary for Benefits testified 
that the system is the most complex disability claims system in 
the Federal Government and opined that the process veterans 
must follow is complicated. And in testimony last year, VA's 
current Under Secretary for Benefits said that it has become an 
increasingly complex system.
    Also, in the VA's 2007 budget submission--VA repeatedly 
stressed how complex the system had become. Can you clarify 
whether you are suggesting the system is not complex?
    Mr. Aument. I certainly can, sir. Indeed, I take no issue 
with those statements. It is a complicated system, but our 
concern is not to make it more complicated than it is.
    Chairman Craig. You are suggesting that a veteran's right 
to hire an attorney would make it more complicated?
    Mr. Aument. I am suggesting, sir, that the current nature 
of the process was designed totally to be a non-adversarial 
process. We believe that inevitably the introduction of routine 
attorney representation at the original claim level is likely 
to make it more complicated.
    Mr. Thompson. If I could interject here.
    Chairman Craig. Please.
    Mr. Thompson. Zealous lawyering is, by definition, 
contentious. And contentiousness leads to adversarial 
relationships and you do not have to take VA's word for that. 
Chief Justice Rehnquist in 1988--if you permit me to quote just 
four sentences from a 1988 Supreme Court decision authored by 
the Chief Justice.
    He said that ``even apart from the frustration of 
Congress's principal goal of wanting the veteran to get the 
entirety of the award, the destruction of the fee limitation 
would bid fair to complicate a proceeding which Congress wished 
to keep as simple as possible. It is scarcely open to doubt 
that if claimants were permitted to retain compensated 
attorneys the day might come when it could be said that an 
attorney might indeed be necessary to present a claim properly 
in a system rendered more adversary and more complex by the 
very presence of lawyer representation.
    It is only a small step beyond that to the situation in 
which the claimant, who has a factually simple and obviously 
deserving claim, may nonetheless feel impelled to retain an 
attorney, simply because so many other claimants retain 
attorneys. This additional complexity will undoubtedly engender 
greater administrative costs with the end result being that 
less Government money reaches the intended beneficiaries.''
    We think it really would lead inexorably to a more 
complicated and more adversarial system.
    Chairman Craig. We could go on. Your position has been made 
very, very clear. And I think you're finding that not only do a 
substantial number of people disagree, but this Committee 
disagrees with you. And we will see if we can work our way 
through this.
    I find it interesting that until recently not a single law 
school in the country included a course in veterans law in its 
curriculum. With the current restrictions on receiving any 
compensation at all for helping veterans navigate the VA 
system, few attorneys, estimated at less than 200, have made 
veterans law a principal area of practice.
    Is it not entirely possible that if attorneys are exposed 
to this area of law during law school and have the benefit that 
the VSO representatives now enjoy of being able to earn a 
living helping veterans navigate the VA system, they too could 
be included as providing a valuable service to veterans?
    Mr. Thompson. We do not believe there is any doubt that 
lawyers who become expert in this practice could lend help to a 
claimant, but the VSOs are themselves very experienced and are 
expert in providing this service. They do it now for free. So, 
the question really becomes whether you want benefits 
appropriated for veterans to compensate them for their 
injuries--you want a portion of those benefits to be diverted 
to the pockets of attorneys.
    Chairman Craig. We will leave it at that. Gentlemen, thank 
you very much for your testimony on this and other pieces of 
legislation. We will work with you as it relates to educational 
benefits. You made some suggestions and we will see if those 
can be worked out, because I think both Senators pointed out 
the obvious, the changing educational environment and the need 
to keep the GI Bill tuned to that.
    Thank you very much.
    Now let us call our third panel. We are inviting the 
Honorable Donald Ivers, former Chief Judge of the United States 
Court of Appeals for Veterans Claims; Quentin Kinderman, Deputy 
Director, National Legislative Services, Veterans of Foreign 
Wars of the United States; Richard Weidman, Director of 
Government Relations, Vietnam Veterans of America; and Bart 
Stichman, Co-Director, National Veterans Legal Services 
Program.
    We will get you all settled in and Judge Ivers, we will 
start with you. Thank you for being with us today.

  STATEMENT OF HON. DONALD L. IVERS, FORMER CHIEF JUDGE, U.S. 
              COURT OF APPEALS FOR VETERANS CLAIMS

    Judge Ivers. Thank you, Mr. Chairman, Members of the 
Committee. I want to thank you for this opportunity to appear 
here and testify regarding S. 2694, the Veterans Choice of 
Representation Act of 2006.
    I also want to thank the Committee staff, especially Amanda 
Meredith and Brian Bainbridge for their courtesies in preparing 
for this testimony today.
    I want to say to the Committee that I am testifying here at 
the invitation of the Committee as a former judge, and I am not 
representing the Court as it is currently constituted.
    Chairman Craig. Thank you for making that clarification for 
the record.
    Judge Ivers. This Act, which grants veterans the right to 
retain counsel at the initial stages of the claims process is 
but another step in the continuing, evolving process of 
judicial review. That process began in 1988 with the passage of 
the Veterans' Judicial Review Act.
    In my opinion, the time has come for this next step. The 
U.S. Court of Appeals for Veterans Claims, as the Committee 
well knows, has long been on record in support of a veteran's 
right to retain counsel at the initial stages of the process. 
The first Chief Judge of the Court, the Honorable Frank Nebeker 
was to testify before this Committee in May, but is now out of 
the country. I am here in his stead and ask that his letter of 
May 10, 2006, and mine of June 6, be submitted in their 
entirety for the record.
    Both of those letters are brief, concise and self-
explanatory. In fact, I will conclude my brief testimony with 
that reference.
    [The prepared statement of Judge Ivers with attached 
letters follow:]

      Prepared Statement of Donald L. Ivers, Former Chief Judge, 
               U.S. Court of Appeals for Veterans Claims

    Thank you for the invitation to testify before the Committee on 
June 8, 2006, and to address S. 2694, the ``Veterans' Choice of 
Representation Act of 2006.''
    In his May 10, 2006, letter to you, Frank Nebeker, the first Chief 
Judge of the U.S. Court of Appeals for Veterans Claims, who was 
initially asked to testify, set forth his views regarding S. 2694. I 
have read that letter and I am in complete agreement with Judge 
Nebeker's views. In order to minimize redundancy, I ask that Judge 
Nebeker's letter be made available along with mine at the hearing.
    The Committee is probably aware that the Court has long been on 
record as supporting the availability of attorney representation at the 
initial stages of the claims process. Freedom to seek counsel of one's 
choice has long been a hallmark of this Nation's system of justice. 
That those who have given much in defense of that system are denied 
that freedom in pursuing claims arising out of their service is, at 
best, highly contradictory.
    As Frank Nebeker points out in his letter, attorney discipline is 
powerful and active in every jurisdiction. That should relieve the 
Department of much of the burden of regulating the qualification and 
actions of those attorneys retained by veterans. Furthermore, attorneys 
are expected and required to follow appropriate ethical codes and to 
assure the effectiveness and viability of any system in which they 
provide representation, either adversarial or paternal.
    My personal position on this issue is not one that I take lightly 
or without awareness that I have taken a different position in years 
past. My position, is, however, tempered by my service on the Court and 
the opportunity to observe the process from both within and without, so 
to speak. It is, if anything, stronger for that opportunity.
    I join with Judge Nebeker in commending this effort to provide 
veterans the freedom to enter into a willing attorney-client 
relationship at the initial stages of the benefits claims process. I 
also join in his observation that a slow integration of attorney 
representation would give rise to invidious discrimination against 
those already in the system who might wish to retain counsel.
                                 ______
                                 
Hon. Larry E. Craig,
Chairman, Committee on Veterans' Affairs,
U.S. Senate, Washington, DC.
    Dear Mr. Chairman: Thank you for the invitation to testify before 
the Committee on June 8, 2006, and to address S. 2694, the ``Veterans' 
Choice of Representation Act of 2006.''
    In his May 10, 2006, letter to you, Frank Nebeker, the first Chief 
Judge of the U.S. Court of Appeals for Veterans Claims, who was 
initially asked to testify, set forth his views regarding S. 2694. I 
have read that letter and I am in complete agreement with Judge 
Nebeker's views. In order to minimize redundancy, I ask that Judge 
Nebeker's letter be made available along with mine at the hearing.
    The Committee is probably aware that the Court has long been on 
record as supporting the availability of attorney representation at the 
initial stages of the claims process. Freedom to seek counsel of one's 
choice has long been a hallmark of this Nation's system of justice. 
That those who have given much in defense of that system are denied 
that freedom in pursuing claims arising out of their service is, at 
best, highly contradictory.
    As Frank Nebeker points out in his letter, attorney discipline is 
powerful and active in every jurisdiction. That should relieve the 
Department of much of the burden of regulating the qualification and 
actions of those attorneys retained by veterans. Furthermore, attorneys 
are expected and required to follow appropriate ethical codes and to 
assure the effectiveness and viability of any system in which they 
provide representation, either adversarial or paternal.
    My personal position on this issue is not one that I take lightly 
or without awareness that I have taken a different position in years 
past. My position, is, however, tempered by my service on the Court and 
the opportunity to observe the process from both within and without, so 
to speak. It is, if anything, stronger for that opportunity.
    I join with Judge Nebeker in commending this effort to provide 
veterans the freedom to enter into a willing attorney-client 
relationship at the initial stages of the benefits claims process. I 
also join in his observation that a slow integration of attorney 
representation would give rise to invidious discrimination against 
those already in the system who might wish to retain counsel.

            Sincerely,
                                                   Donald L. Ivers.
                                 ______
                                 
                                                       May 10, 2006
Hon. Larry E. Craig,
Chairman, Veterans' Affairs Committee,
Hart Senate Office Building,
Washington, DC.
    Dear Mr. Chairman: Thank you for the invitation to express my views 
on S. 2694. As you know, I was the first Chief Judge of the Veterans' 
Court. It soon became clear to me and my colleagues that the paternal 
approach of effectively preventing lawyer representation in the 
benefits process was severely outmoded. Thus, I compliment the sponsors 
of S. 2694 for recognizing that veterans, like everyone else, should be 
at liberty to seek counsel in the free market. Indeed, the fear that 
once existed that veterans needed protection from predatory lawyers no 
longer exists. Every jurisdiction in this country has very powerful and 
active disciplinary entities to police their bars under quite detailed 
and strong codes of professional conduct. I can speak from my 
experience on the District of Columbia Court of Appeals since 1969. 
Today the Court has a very substantial portion of its docket dealing 
with lawyer discipline--much of it in reciprocal discipline from all 
state courts and many Federal courts. Thus, burdening the Secretary 
with lawyer qualification, regulation, and discipline should, in my 
view, be kept at a minimum in light of extant bar disciplinary systems.
    It may be anticipated that some resistance to this change from a 
once well intentioned limitation on the ability to retain counsel will 
develop. To the extent such resistance is motivated by a ``turf'' 
interest in keeping lawyers from invading the province of non-lawyer 
veteran service officers, it should be paid no heed. The benefits 
process has become so complex and protracted that the need for counsel 
is manifest where it was not before. To the extent that that resistance 
is motivated by concern for maintaining the non-adversarial nature of 
veterans' benefits process, I suggest once a claim has been denied and 
the veteran wishes to appeal, the process inescapably becomes 
adversarial. The need for filing a ``notice of disagreement,'' by its 
terms, connotes the commencement of an adversarial process from the 
veteran's perspective. The fact that the duty to assist and the 
evidentiary equipoise doctrine remain viable does not alter the reality 
of the veteran's situation and his or her perception that it is now 
``Veteran v. VA.''
    Moreover, the proceedings before the Court of Appeals for Veterans 
Claims have been recognized as adversarial from 1989, the inception of 
the Court. That fact has not negated the non-adversarial nature of the 
process at VA. Indeed, with counsel representing the appellant veteran, 
it has always been possible to ensure that the duty to assist and the 
evidentiary equipoise doctrine remain the rule. The presence of counsel 
for the claimant does not alter the paternal nature of the process, nor 
would it from the initial claim level and beyond. In fact, counsel can 
assure the viability of that process from the very beginning.
    Some might say that with counsel present the claimant is ``ready to 
fight,'' but that view misperceives the role of counsel particularly in 
a non-adversarial process. Counsel is there to ensure the nature of the 
process is preserved as well as to ensure from the beginning that 
errors threatening that process do not occur.
    I commend the effort to treat veterans as equals of all citizens in 
their right to seek a willing attorney and client relationship at the 
initial stage of the benefits process. But I have considerable doubt 
that slow integration of lawyer representation only in the initial 
application stage is necessary and reasonable since those already in 
the system would be invidiously discriminated against by being unable 
to retain counsel. There will hardly be a landslide of lawyers 
appearing at subsequent stages prior to a final BVA decision. At least 
there is no evidence to support a favorable reaction to such an in 
terrorem argument.

            Sincerely,
                                                  Frank Q. Nebeker.

    Chairman Craig. Judge, thank you.
    Judge Ivers. Again, I want to thank you for the opportunity 
to testify, and I will be glad to respond to any questions you 
might have.
    Chairman Craig. Thank you very much. Those two letters will 
become a part of the record.
    We have had a vote start, but I think we can still get 
through some testimony before that, and then I will recess, run 
and vote, and return very quickly.
    Quentin, we will continue with your testimony.

   STATEMENT OF QUENTIN KINDERMAN, DEPUTY DIRECTOR, NATIONAL 
  LEGISLATIVE SERVICE, VETERANS OF FOREIGN WARS OF THE UNITED 
                             STATES

    Mr. Kinderman. Thank you, Mr. Chairman. First, I would like 
to thank you for coming over last night to the House Office 
Building and for your inspiring words of tribute to your friend 
and ours, Lane Evans.
    Chairman Craig. Thank you for hosting that. It was very 
appropriate.
    Mr. Kinderman. Mr. Chairman and Members of the Committee. 
VFW appreciates very much the opportunity to present our views 
on legislation here, especially the bill that you have 
sponsored, and which seems to be the focus of interest.
    I would like to go through the bills, but probably end with 
that one.
    Chairman Craig. OK.
    Mr. Kinderman. Because I think that one will consume the 
most time.
    With regard to S. 2121, the Veterans Housing Fairness Act, 
which extends VA loans to cooperative residential units, we 
favor that legislation and we expect that, since the rest of 
the housing industry has figured out ways to finance co-ops, we 
think the VA could probably sort that out, as well. We have 
great faith in them.
    Regarding S. 2416, The Veterans Employment and Training 
Act, which would expand accelerated payment for courses of 
instruction in high-tech and other high demand fields, we 
support that as we also support S. 3363, by Senator DeWine, who 
would provide similar benefits for Chapter 35 survivors and 
dependents.
    We do have some reservations about, essentially, paying out 
large sums of money for short-term courses. We would suggest to 
you that you continue to have strong oversight and demand that 
the VA, in administering these bills, are very careful about 
it. Some of these schools come and go and we want to protect 
the veterans interests, as well as their long-term careers.
    With regard to the Cemetery Bill for Native Americans, we 
also favor that. We also favor its House companion bill.
    With regard to the Cost-of-Living Increase Bill, we 
appreciate your interest in maintaining the integrity of the 
veterans compensation program and the rates. We do not favor 
what some veterans organizations have talked about, which would 
be indexing it once and for all. We would prefer, I think, to 
have the opportunity to discuss it with you in this forum every 
year, which has been a strong tradition.
    We do have some reservations about the rate structures as 
they exist today. And we make reference to that in our 
statement and we can provide more information for the record if 
you would like to see that. But essentially this chart shows 
the rate structure as it exists today. I apologize for the 
colors. They are probably a little bit inappropriate, but, sir, 
it is rates and not States.
    The red ones are the actual rates that the veterans 
receive. The blue ones are what they would be if they were, in 
fact, proportional to the 100 percent rate. I do not think too 
many people realize that the 90 percent rate actually pays 60 
percent of the total rate, and so on. Eighty percent is a 
little over 50 percent and as you get down to the bottom, they 
are about half of what you would have expected.
    We think that particularly up in here, in the upper reaches 
of the rates, it plays havoc with incentives and the other 
aspects of the program. We just want to bring that to your 
attention.
    Chairman Craig. We will take a look at that.
    Mr. Kinderman. I would be glad to provide that for you.
    Chairman Craig. Thank you.
    Mr. Kinderman. We realize that there is a commission 
considering the veterans program, as we speak, and that at the 
time the commission submits its report that this will probably 
be an issue, but we wanted to kind of give you a heads up as to 
what we are thinking on that.
    Chairman Craig. OK.
    Mr. Kinderman. But we do appreciate the COLA. We would like 
to see you round up the numbers instead of down, but that is a 
minor point.
    Chairman Craig. OK.
    Mr. Kinderman. Which brings us of course to the Veterans 
Choice of Representation Act. We are bound in the VFW by a 
resolution to oppose the practice of attorneys for pay at the 
regional office. About half of our testimony goes to that 
issue. In essence, I think we can really state five reasons. 
Just very briefly.
    We do not believe that lawyers are a necessary expense at 
the initial claim level. If there is going to be an appeal, the 
money that veterans would pay lawyers is probably better spent 
in that appeal. Otherwise, we do not see that is necessary.
    To paraphrase a famous movie, VA cannot handle lawyers. A 
lot of what has been called complexity here, we see a little 
differently. We see it as an administrative system that is in 
desperate trouble. We see big backlogs. We see 15 percent error 
rate. We see somewhat chaotic leadership from time to time and 
we see major crises, as we had in the last 2 weeks, which will 
have significant effect on that.
    A good lawyer will pursue every avenue, alternative 
evidence, treatment and exams outside VA, he will claim every 
possible condition. Much effort will be expended by the veteran 
and the VA, generally, probably for the same result as would 
happen were he represented by a veterans organization at no 
cost. We think the incentives that an attorney will have, in 
terms of maximizing his fee, will be prevailing rather than the 
altruistic desire to serve veterans.
    With regard to the types of claims, we think lawyers will, 
at least initially, pick claims that will be profitable. We do 
not think that they are going to get involved in claims that 
are questionable or too complex that require enormous amounts 
of investment before they reach any kind of resolution.
    We also have some very serious reservations about the 
provisions of the bill that would require the VA General 
Counsel to police non-adversarial behavior and frivolous 
claims. Some of the things that have become mainstream claims 
in the VA, Agent Orange, Persian Gulf Illness, things like 
that, would have, I think, initially been considered frivolous. 
They are so far from what one would imagine would happen. But 
wartime is a very difficult time and strange things happen.
    Regarding non-adversarial behavior, I am not sure you can 
even really define that, but I think that might have a chilling 
effect if we are going to do this. And our position, of course, 
is you should not do this.
    If you are going to do this, and you are going to have 
attorneys practicing at this level, let them be attorneys. It 
will become adversarial. It will become difficult. The VA will 
get worse backlogs than they have now. I think the effect of 
keeping this threat of not behaving in a non-adversarial manner 
over the advocates, both veterans advocates and attorneys, 
would be very difficult.
    Finally, we do not think that, as important as this might 
be to some veterans right now, we do not think this addresses 
what are the real issues in VBA, and we think that this would, 
for virtually all veterans, the intrusion of this very work 
intensive aspect of representation would make things tough for 
everybody.
    I would like to just take a moment and read something that 
was taken from testimony in 1988, before the hearings in this 
Committee on judicial review, by my good friend Don Ivers, when 
he was General Counsel of VA. And I do not do this to embarrass 
him. I do this because I think it is the best description of 
how a lawyer should behave and how he should serve his client.
    ``Under our adversary system, the role of counsel is not to 
make sure that the truth is asserted, but to advance his 
client's cause by any ethical means within the limits of 
professional propriety. Causing delay and sowing confusion are 
not only his right, but may be his duty. The appearance of 
counsel for the citizen is likely to lead the Government to 
provide one, or at least to cause the Government's 
representative to act like one.''
    In other words, I think it will become much more 
adversarial in the regional offices if we have attorneys 
practicing in there. That is one man's opinion, but if you 
take, possibly, the duty to cause delay and sow confusion in 
the regional offices, there is plenty of that already. I cannot 
imagine that they could tolerate a whole lot more. I think what 
could very well happen is a representative, an attorney, would, 
in essence, attempt, not only to get his client the proper 
decision, but develop a reputation for wearing down the 
process, and thus maybe get a faster path, more receptive path 
in the regional offices. I think that is not outside the realm 
of possibility.
    Mr. Chairman and Members of the Committee, once again on 
behalf of the men and women of the Veterans of Foreign Wars, I 
thank you for inviting us to present our views here today. I 
will be happy to respond to any questions you may have.
    [The prepared statement of Mr. Kinderman follows:]

  Prepared Statement of Quentin Kinderman, Deputy Director, National 
   Legislative Service, Veterans of Foreign Wars of the United States

    On behalf of the 2.4 million men and women of the Veterans of 
Foreign Wars of the U.S. (VFW) and our Auxiliaries, thank you for 
including us in today's discussion on the veterans' benefits bills 
under consideration.
    S. 1990, the ``Veterans Outreach Improvement Act of 2005,'' 
establishes a $25 million program to provide grants for state veterans' 
outreach programs. The grants would be weighted based on the veterans' 
population by state. Because it would be funded from the VA, the VFW 
cannot support this bill.
    The VFW recognizes the need for increased local outreach and 
supports the goals of this legislation. However, as structured, this 
program would redirect funds used for Veterans Benefits Administration 
(VBA) use for VA outreach and claims processing unless Congress 
allocates funding from a separate appropriations account, in addition 
to current VBA funding. The VBA faces a mounting challenge of the 
808,000 plus claims that await processing and a dismal error rate on 
the claims they do process. While we are aware that VBA asserts that 
their resources are adequate, it appears to us that there is 
considerable evidence that this is not the case. Removing VBA resources 
to do outreach weighted toward the largest, most populous states, will 
exacerbate VBA's claims processing problems. While we do not doubt that 
there exists a need to reach out to America's underserved veterans, we 
do not see further deterioration in service as a viable tradeoff for 
this initiative.
    The VFW supports S. 2121, the ``Veterans Housing Fairness Act of 
2005,'' which would extend housing loan benefits to purchase 
residential cooperative apartment units. Many other government 
agencies, including the Federal Housing Administration (FHA) already 
have programs in place, which provide loans for cooperative residential 
units, and we believe that VA would also be able to address any legal 
issues by regulation, as well. This bill would favorably impact 
veterans living in densely populated urban areas and create options for 
veterans facing expensive housing markets.
    S. 2416, the ``Veterans Employment and Training Act of 2006,'' aims 
to expand licensure based lump-sum payments to areas of industry that 
are experiencing critical shortages of employees or that are deemed 
high growth industries, as determined by the Secretary of Labor.
    The VFW has long called for the expansion of licensure and 
certification programs to expedite the transition period from military 
to civilian employment for servicemembers. We have also supported 
expanding the GI Bill to make it more flexible and adaptable to the 
real needs of today's veterans. Despite this, we have several concerns 
about this legislation.
    We are wary that the definition of the industries this bill covers 
is overly broad; and in some cases, it could lead to careers, which do 
not provide adequate skills to sustain long-term goals. The Department 
of Labor's definition currently includes such broad industries as 
``hospitality'' and ``retail.'' While rewarding careers can be found 
within these industries, we believe the definition of which types of 
programs are eligible needs careful monitoring, making it easier for 
veterans to find truly rewarding careers in high-paying jobs.
    Our second concern is oversight. With the expansion of the program, 
comes opportunity for ``start-up'' companies and businesses claiming to 
provide educational training opportunities for veterans as a way to 
make easy profits. While the vast majority of companies are sure to 
provide legitimate service, there will likely be opportunity for fraud 
and abuse. Congress must see to it that there is vigorous oversight 
built into the program to include significant evaluation and 
accreditation so that unscrupulous companies cannot take advantage of 
veterans.
    S. 2562, the ``Veterans' Compensation Cost-of-Living Adjustment Act 
of 2006,'' seeks to adjust compensation rates to reflect the rising 
cost of living. We appreciate the Committee's commitment to maintaining 
the integrity of the buying power of the veterans' compensation program 
by providing periodic cost-of-living increases (COLAs). We fully 
support this goal. However, we note that this bill once again contains 
a provision for rounding down any fraction of a dollar in the COLA 
calculation. This works against the spirit of this bill.
    Over time rounding down the dollar, when combined with other 
adjustments to meet budgetary goals, has caused erosion in fractional 
compensation rates, especially for severely disabled veterans. This has 
lead to significant problems for America's veterans. We think this is 
the underlying cause of some compensation policy problems recognized by 
this Committee. Accordingly, we support this action to adjust the 
buying power of this program, which is of critical importance to 
America's veterans who have sacrificed life and limb for our country; 
but we urge you to refrain from this process of rounding down the last 
dollar. While we realize that restoring the compensation rates to 
linearity with the percentage of disability would require a significant 
budgetary commitment, we urge you to at least begin the process by 
enacting a ``rounding up'' provision this year. This would serve as a 
show of good faith with America's veterans.
    S. 2659, the ``Native American Veterans Cemetery Act of 2006,'' 
would allow tribal organizations to apply for grants to establish and 
maintain veterans' cemeteries on tribal lands. We fully support S. 
2659. We believe that this is a logical extension of the veterans' 
cemetery grant program and will serve the needs of Native American 
veterans and their families that are not fully addressed by the 
National and State veterans' cemeteries.
    S. 2694, the ``Veterans' Choice of Representation Act of 2006,'' is 
generally consistent with the proposals that the Veterans of Foreign 
Wars has opposed over many years. It would provide for claimants the 
opportunity to be represented by for-profit lawyers from the point of 
first filing a claim at a VBA regional office, instead of from the 
point at which administrative remedies have been exhausted, the 
decision of the Board of Veterans' Appeals (BVA). This is a radical 
departure from current law.
    The current administrative process, despite its shortcomings in 
execution, is designed to be a non-adversarial process, with multiple 
opportunities for review, and no restrictions on the submission of 
evidence. By design, it also offers the opportunity for self-
representation, or representation by Veterans Service Organizations 
(VSO) representatives at no cost to the claimant. This is the 
administrative process of filing a claim, and many claims are granted 
at this level. If not granted, then from the Notice of Disagreement to 
the BVA decision, many claims, which were initially denied, are 
reversed on reconsideration, or on account of submission of new 
evidence. These claimants, if represented by lawyers under the 
provisions of this bill, would pay a substantial amount of their 
benefits as a fee for services that either would require only nominal 
effort, or would have been provided at no cost by a VSO representative.
    This would represent a windfall opportunity for lawyers to earn 
significant fees with little effort. Moreover, since the fees may also 
be dependent on the accumulated retroactive benefit, this bill provides 
incentive for lawyers to slow the administrative process as much as 
possible, both to wear down resistance to granting the benefit, but 
also to maximize the past due amount of benefits payable. Since there 
is no provision in this bill requiring lawyers to accept all clients, 
they are free to pick those claimants who have claims that are most 
likely to prevail in the administrative process. This allows lawyers to 
maximize the fees payable, while minimizing their own efforts.
    While the VFW supports veteran claimants, and the struggle that 
many face to receive the benefits that they deserve as a result of 
their increasingly often-heroic service, we believe that the 
interjection of lawyers into a system intended to serve most claimants 
sympathetically and efficiently is misguided. It would inevitably 
result in even less timely service, and provide program administrators 
with a justification to ratchet back still further in service and 
assistance.
    Under current law, claimants have the opportunity for legal 
representation in the adversarial court process following a denial at 
the BVA. VFW believes that this is the logical point at which the 
assistance of a for-profit lawyer is appropriate and necessary. The 
current system conserves the claimants' resources should it be 
necessary to hire an attorney at the appellate level. We have seen, 
even under the current system, claimants left without either resources 
or representation, in the midst of their appeal, when both run out on 
them.
    The VFW still hopes that the VA leadership will address the very 
significant deficiencies in claims processing in the regional offices, 
but our optimism wanes. VBA's claims backlog now exceeds 808,000 
claims, and continues to grow, the very significant errors in about 
100,000 claims per year remain unaddressed, duty to assist is often not 
honored, and appeals processing is grinding to a standstill in some 
offices. Yet, VBA asserts that they are adequately staffed. If this is 
the growing ``complexity'' that justifies for-profit representation at 
the regional office level, then lawyers will provide relief for 
selected claimants, at significant additional cost to them, but at 
substantial cost to the entire system, since attorneys will not 
tolerate this treatment by the VBA. Unless VBA addresses their own 
problems instead of ignoring them, any significant number of attorneys 
practicing at the regional office level may bring this system to the 
point of collapse. The VBA system is simply not robust enough to absorb 
the additional labor-intensive burden that effective for-profit 
representation will impose. Introducing attorneys at the initial stages 
of claims processing might be the tipping point referenced by the 
Administrative Conference of the United States, in testimony before the 
passage of the 1988 Veterans' Judicial Review Act, that any system that 
permits attorneys, will eventually require them.
    The VFW is also concerned that provisions in S. 2694, which would 
apply to both attorneys and veterans' service organizations 
representatives (VSORs) would negatively affect their ability to assist 
veterans. This provision, no doubt crafted to address some of the 
objections raised by the VFW and other organizations, would authorize 
the VA General Counsel (VAGC) to remove or sanction any veteran 
representative who fails to respect the ``non-adversarial nature of any 
proceeding . . .'' or presented ``. . . frivolous claims, issues, or 
arguments to the Department . . .'' or any other standard that the 
Secretary sees fit to establish by regulation. It seems to us that 
these restrictions are both too vague and subjective, and are 
potentially too vulnerable to abuse by a department seeking to restrict 
workload, to be in the best interest of veterans.
    We frequently hear the complaint from VBA leadership that veterans 
present claims for too many conditions or that veterans should be 
restricted from reopening claims when their disabilities become more 
severe. Our responsibility is to represent the interests of America's 
veterans. We do this in teamwork with the VBA. However, should the best 
interest of a veteran diverge from that of the VA, we do our best 
within the law to assist the veteran. Furthermore, while we as VSORs 
work toward fair and equitable decisions under the established 
statutes, policies, and regulations and recognize that the system must 
work accurately and efficiently for all to benefit, an attorney can and 
should set about winning the maximum benefits for his/her client. This 
would necessarily suggest the maximum use of every opportunity to 
acquire or submit evidence, testify at a hearing, or dispute VA exams 
or other evidence.
    While we believe this is not disrespect for the ``. . . non-
adversarial nature of any proceeding . . .'' and it might increase the 
cost of representation to the veteran, it will inevitably slow down VBA 
processing. Should VA seek to curtail this as ``adversarial'' behavior 
when faced by the inevitable growing backlogs, there is no obvious line 
at which veteran's right to the claims process could be fairly limited. 
One need only look at the history of claims processing before the 
Veterans' Claims Assistance Act of 2000 and the many claims denied as 
``not well grounded'' to realize that the balance between protecting 
veterans' rights and addressing backlogs is a difficult one. We believe 
that, in the effort to protect the non-adversarial process, veterans' 
rights might be harmed, or taken away. The possibility of sanctions or 
removal might tend to intimidate or discourage claims representatives, 
or if this bill were to be enacted in full, attorneys. This would not 
be in the veteran's best interest.
    Regarding ``frivolous'' claims, we believe that prior to 
Congressional action, claims from veterans claiming to be harmed by 
weed killers used in Vietnam, atomic tests, secret mustard gas 
experiments on ``volunteer'' servicemen, and Gulf War illnesses that 
defy diagnosis, might all meet some definition of ``frivolous.'' In at 
least one example: Agent Orange, veterans who accepted VA's guidance 
and did not file were penalized as a result. While we realize that the 
Veterans' Court has established a very limited definition of frivolous 
claim, we see no legitimate need for this restriction at the initial 
claim's level. Certainly, any claim that is truly frivolous would be as 
rare as to have negligible an affect on VBA's workload; and the 
potential for abuse by restricting legitimate claims would be too great 
to make this restriction worthwhile. Certainly, an administration that 
tolerates 100,000+ seriously erroneous claims decisions every year 
should not be authorized to restrict the claims themselves on the basis 
that they might be perceived to be frivolous.
    It is for these reasons that we must oppose S. 2694.

    Chairman Craig. Quentin, thank you.
    I am going to have to recess the Committee for a few 
moments while I run and vote, and then we will be back for the 
rest of the testimony.
    Mr. Kinderman. Thank you, Mr. Chairman.
    Chairman Craig. And I will let you and the Judge work out 
your differences.
    [Laughter.]
    Mr. Kinderman. Would you like us to do that while you are 
gone, or should we wait?
    Chairman Craig. Please.
    [Laughter.]
    Judge Ivers. I would like to have an opportunity to 
respond, Mr. Chairman.
    [Recess.]
    Chairman Craig. The Committee will reconvene. Thank you, 
gentlemen, for your patience, and the audience, for your 
patience.
    Before I go to Mr. Stichman let me turn to Judge Ivers 
again.
    Judge Ivers, you have been quoted, I think reasonably, for 
the record and in a reasonably short period of time, I should 
give you the opportunity to respond to your own words.
    Judge Ivers. Thank you, Mr. Chairman. I first want to 
disavow total ownership of those words, and point out that they 
were quoted from a law review article by Judge Friendly in the 
University of Pennsylvania Law Review in 1975. So they are not 
totally my words; however, they were part of my testimony. I 
think, in fairness, we need to go back and look at what was 
being considered at that time.
    First of all, I was the General Counsel of the Veterans' 
Administration at that time. The Administration's position was 
that we did not need lawyers at the initial stages. I do not 
disagree with that position at that time in that context. I 
still feel that was probably the right position to take.
    However, the other thing that was under consideration at 
that time was a process whereby once a veteran completed the VA 
process, he or she would go directly into the U.S. District 
Courts. That was before Congress, in its wisdom, arrived at the 
compromise, which became the U.S. Court of Appeals for Veterans 
Claims, which I think was the right answer, if there was to be 
judicial review. But at the time that testimony was given and 
that statement was made and Judge Friendly was quoted, the 
object of the exercise was to put veterans cases into the 
Federal Court system at the U.S. District Court level. That, 
for lack of a better term would have turned them into a 
veritable brawl with different results coming from different 
U.S. District Courts and the further need to filter the results 
up through the Federal Circuits.
    So, we were talking about a completely different process.
    Chairman Craig. Thank you. I appreciate that.
    Mr. Kinderman. Mr. Chairman, very briefly.
    I did not hear Judge Ivers say anything about the nature of 
lawyers changing from Judge Friendly's characterization of 
someone who will do everything within appropriate limits for 
their client, which was the sole purpose of my quoting him.
    Chairman Craig. Thank you.
    Judge Ivers. May I, Mr. Chairman?
    Chairman Craig. Very briefly.
    [Laughter.]
    Judge Ivers. I think that you have to take Judge Friendly's 
comments with a grain of salt and also look at this process 
that we are engaged in now. The Veterans judicial review is an 
ongoing educational and maturing process. Attorneys are bound 
by ethical rules. They are bound to follow the rules of the 
forum in which they appear. If it is a non-adversarial forum, 
then the attorney is obligated to honor that system.
    The system can police itself in that respect by seeing that 
lawyers toe the line and abide by the non-adversarial nature of 
the proceedings below. Again, it does not become adversarial in 
the strictest sense until you get into the court. I think there 
is some merit to the argument that once you are denied a 
benefit, as far as you are concerned as a veteran, it is 
adversarial, particularly if you believe very strongly, as most 
veterans do, that they are entitled to that benefit and they 
are being wrongfully denied.
    Chairman Craig. All right, gentlemen.
    Mr. Kinderman. Just one more, please.
    Chairman Craig. Alright. No more counterpoint. I gave you 
five extra minutes in your opening statement.
    Mr. Kinderman. Yes, sir.
    I am not going to say a word about taking Judge Ivers' 
testimony with a grain of salt, but I do have here an article 
that I downloaded from the Internet about an attorney who is 
doing very well out of Nebraska, which perhaps means that this 
legislation is not necessary. He represents many veterans, 
apparently, in his county before the VA in Nebraska, from the 
very beginning of the claim.
    He does not charge an attorney fee, but he has a memorandum 
of gift, instead of memorandum of fee. He is apparently very 
successful at having veterans, after their claims are decided 
successfully at the regional office, tip him 20 percent of the 
retroactive benefits.
    I spoke to the VA General Counsel. They are going to look 
into it. But I might say that it appears in this article, if it 
is true, the Nebraska Supreme Court's Counsel for Discipline 
investigated the matter and says that there does not appear to 
be anything illegal or unethical about the attorney receiving 
gifts freely given. So, I would submit that for the record.
    Chairman Craig. I understand that. Doctors used to take 
chickens and pieces of beef, also, for services rendered to 
their clients. I think we have gone beyond that. Obviously, 
here is a gentleman who, if true, has found a unique way to 
find compensation in a system that denies it. The intent of the 
legislation is not to deny it.
    Mr. Kinderman. I understand.
    Chairman Craig. OK. Let us move on. I thank you both for 
your testimony.
    Richard Weidman, Director of Government Relations, Vietnam 
Veterans of America, welcome to the Committee.

STATEMENT OF RICHARD WEIDMAN, DIRECTOR OF GOVERNMENT RELATIONS, 
                  VIETNAM VETERANS OF AMERICA

    Mr. Weidman. Thank you very much, Mr. Chairman. On behalf 
of John Rowan, our national president, I want to thank you and 
your distinguished colleagues for the opportunity to present 
our views here today.
    Like my colleague from the VFW, I will take the less 
controversial first if I may----
    Chairman Craig. Alright.
    Mr. Weidman [continuing].--and then zero in on the attorney 
representation. In regard to the COLA Bill, S. 2562, Vietnam 
Veterans of America is very much in favor of it.
    S. 2121, as someone who grew up in New York City, I can 
tell you how much this legislation is needed. To not be able to 
purchase a co-op, which was one of the main ways housing is 
organized in the Greater New York City area is a tremendous 
detriment to our veterans. The ability to exercise this 
important veterans benefit should not be determined by where 
one lives in the country. And now, there is discrimination 
against the 200,000 plus veterans who live in the Greater New 
York City area, in that they cannot exercise the opportunity to 
use a VA loan guaranteed by a co-op.
    In regard to 2659, the Native American Veterans Cemetery 
Act, we thank Senator Akaka and Senator Inouye for introducing 
that. We are very much in favor of providing that opportunity 
to Native Americans to establish their own resting place for 
their veterans in the reserve territories. We would hope for a 
speedy passage and enactment of that bill.
    In regard to S. 2416, VVA is very much in favor of that 
bill. And while we continue to believe that we need to move 
toward a World War II style GI Bill for the young men and women 
serving today, there are many steps on the road to achieving 
that. But our goal is clear, sir. We need a bill like that 
according to my father when he returned from the South Pacific, 
from the China, Burma, India theater.
    In regard to S. 3363, the Amendment to Title 38, about 
accelerated payments under the GI Bill, VVA strongly supports 
this legislation. The safeguards are in place through the 
State-approving agencies and the only codicil we would put is, 
we would encourage you to have your staff look into the 
difficulties with the legislation that was passed 2 years ago 
with the accelerated payments with problems with the State-
approving agencies moving ahead and approving courses of non-
credit courses of study for veteran entrepreneurs. They have 
become biased, if you will, in favor of those who award 
academic credit. That is not what our entrepreneurs need. They 
need the skills in how to put together a business plan, in how 
to put together a capital formation plan, and in how to 
actually move forward to create wealth and create jobs in this 
society.
    In regard to S. 2694, the Veterans Choice of Representation 
Act of 2006, we want to salute and thank you, Mr. Chairman, for 
introducing this legislation. Since Vietnam Veterans of 
America's inception in 1978, when we were still called the 
Council of Vietnam Veterans, we have favored attorney 
representation and judicial review.
    We believe that this is a right that is now, as you pointed 
out earlier so eloquently, accorded to enemy combatants. It has 
always been accorded to illegal aliens. It has been accorded to 
virtually every sector of society. How ironic it is that the 
very people who pledge life and limb in defense of the 
Constitution of the United States should be denied one of the 
basic rights under the Constitution, which is access to the 
courts under our balance of power in our unique, democratic 
republic.
    There are many distinguished colleagues in the other 
veterans organizations, as you are keenly aware, that oppose 
this. We respect them enormously. We would draw your attention 
and that of your distinguished colleagues not just to the VFW's 
statement, but that of the Disabled American Veterans, which is 
extremely well put together. We disagree with it strenuously, 
but it is extremely well done, and we hope that it will be 
carefully considered by you and all of your colleagues, as well 
as by your staff.
    There is one thing I would like to correct in the record. 
We said $10 originally, it was, of course, $5, and then raised 
to $10 very soon afterwards, in terms of what was allowed. Of 
course, none is allowed today.
    The cries that this will destroy the non-adversarial system 
of veterans benefits were exactly the same cries that we heard 
in 1986 to 1988, during the period where we moved toward, at 
least limited judicial review. Virtually everyone was saying at 
that time, including VA, that it would destroy the veterans 
benefits system as we know it. It has not. The veterans 
benefits system lives on. The problems with the veterans 
benefits system really have much more to do with proper 
training and proper accountability within that system, 
particularly of managers and supervisors and proper training 
with competency--and I stress that if I may, sir--competency-
based testing for everyone involved in the system, including 
adjudicators.
    In regard to involving attorneys, the standards that you 
talked about in terms of professional standards, we believe 
that attorneys can help ensure that this complicated process is 
processed correctly and thoroughly from the outset. Otherwise, 
they are subject to discipline by their local bar association.
    They are going to have to equip themselves just as they 
would have to in any other subset and law specialty in order to 
be able to provide adequate representation to their clients 
under this area of specialized law.
    This would also have the effect of facilitating more 
successful administrative appeals because the claims would be 
better prepared from the outset. I draw your attention, if I 
may, sir, to the IG's report of May 2005, in regard to 
disparities in claims and awards given. One of the key findings 
of that, which was, unfortunately, all too much overlooked, is 
that you had a 68 percent better chance of your claim being 
successful if, in fact, you had a Veterans Service Organization 
representative. Why is that? Because it was better prepared 
than by the VA people, because many of our folks are better 
prepared.
    Those who say that this is not an adversarial system at 
present have never been through this system. We always 
recommend that you get a Veterans Service Representative now, 
or a Veterans Service Officer, if you will, in some 
organizations, because you need someone who knows what he or 
she is doing in terms of preparing your claim and properly 
representing it.
    When veterans do not understand and/or often it is the 
veteran and the spouse who approach us, we explain it by saying 
it is like this, it is like having an attorney represent you 
within this closed system. Only a fool represents him or 
herself before the court. Opening it up to attorneys on the 
outside, we believe, will only make it a more fair system and 
one that is more professional overall.
    As I mentioned before, I am going to touch on again, it is 
an adversarial system, not intentionally so. Because of, as I 
mentioned, lack of accountability, lack of proper training--and 
the reason why they are overwhelmed is that there is not a 
focus on doing it right the first time. Hopefully, with having 
attorneys involved, more competent--and VA will respond with 
having adjudicators better prepared.
    The opponents who say that allowing veterans freedom of 
choice, that only those veterans with financial means--that 
does not restrict people who are seeking benefits before the 
Social Security Administration. As you know, almost all of 
those folks who generally have nothing, because they have not 
been able to work in several years, are represented on a 
contingent basis.
    The overriding concern for VVA, as well as any other group 
that cares about the rights of veterans, is, of course, that 
the veterans get the most effective representation possible. If 
a veteran wants to hire an attorney as his or her 
representative at the VA regional office, is there a legitimate 
basis to deny this right to do so? Our position is that we 
cannot imagine this patronization and regarding VA as--I 
hesitate to use this term, but others have used this term--as 
the last plantation. That somehow, some way, we lose our native 
intelligence when we enlist in the Armed Forces or serve our 
country and take that step forward.
    In addition to losing the right to hire an attorney, that 
somehow, from that point on, we are not competent. That the 
young people who are coming out of the military today who, last 
month, had, at their control in many instances, in some 
military specialties, more firepower and more awesome firepower 
than ever unleashed in the history of mankind suddenly, 
suddenly, as soon as they become veterans, are not capable of 
making an informed and intelligent decision about whether to 
hire an attorney and, if so, what attorney to choose. That 
simply flies in the face of what we believe is a proper 
attitude toward veterans.
    The fair fees, as provided for----
    Chairman Craig. Can I ask you to observe that red light, 
and wrap it up as quickly as you can.
    Mr. Weidman. I am sorry. I am over.
    The fair fees, we are somewhat concerned about the VA--if 
people succeed too much in claims, that there be an appeals 
procedure that really works. And we ask that you exercise 
diligent oversight in that regard. I have talked with your 
staff about this issue, and they have convinced me that the 
oversight and appeals process is adequate and I have gone back 
and talked to our leadership on this issue.
    We are very much in favor of this legislation and once 
again salute you and thank you and urge speedy enactment of 
this legislation as written. Mr. Chairman, thank you very much.
    [The prepared statement of Mr. Weidman follows:]

Prepared Statement of Richard Weidman, Director, Government Relations, 
                      Vietnam Veterans of America

    Chairman Craig and distinguished Members of the Senate Veterans' 
Affairs Committee, on behalf of Vietnam Veterans of America (VVA) and 
our National President John P. Rowan, I thank you for the opportunity 
to appear here today to offer our views on these important pieces of 
legislation. While I will comment on each of the bills being considered 
today, I will devote most of my time to the question of attorney 
representation, as it is perhaps the thorniest question the Committee 
is considering today.
        s. 2694, veterans' choice of representation act of 2006
    American veterans essentially cannot obtain legal representation 
because of the current fee limitation in effect until after their case 
has gone past the Board of Veterans' Appeals. Legal counsel at the 
Court of Appeals for Veterans Claims (CAVC) is allowed to present no 
new evidence. Allowing veterans legal counsel at the initiation of 
their claim would give that claim a legal continuity. Legal counsel is 
the right of all Americans, except veterans. This is an injustice that 
must be redressed. VVA thanks you for bringing this issue to the fore, 
and starting the process that we hope will at long last be successful.
    As you are aware, legislation of this nature is not unheard of, and 
in fact there have been several attempts over the past 20 years to pass 
similar bills. None of these previous attempts have been even remotely 
successful because of the vehement opposition of the Department of 
Veterans Affairs under several Presidents, and the opposition of some 
of our distinguished colleagues in other major veterans service 
organizations (VSOs). The VA bureaucracy itself has opposed opening the 
process to any form of meaningful reform. Today, however, Congress 
appears to be ready to move to fix the broken, backlogged VA claims 
adjudication process. Significantly, unlike in previous efforts, the 
bipartisan leadership of both the Senate and House Veterans' Affairs 
Committees appear to be the primary impetus behind the current 
legislation. For this reason, there is a very strong possibility that 
the current prohibition against veterans hiring attorneys before the VA 
will be repealed during the 109th Congress.
    From our inception in 1978, VVA has been the foremost champion 
among the major VSOs of allowing veterans the right to choose to retain 
attorney representation in their claims for VA benefits, and of 
achieving full judicial review of all Compensation & Pension decisions 
of the VA. In 1988, VVA secured a partial victory in this effort with 
passage of the Veterans Judicial Review Act (VRJA), which among other 
provisions provided for attorney representation of veterans before the 
United States Court of Appeals for Veterans Claims (Veterans Court), 
and limited attorney representation in Veterans Court cases that were 
returned to the VA for re-adjudication. Under the proposed legislation, 
veterans would be allowed to retain an attorney to represent them 
before the VA regional offices (VAROs)--at the stage where their case 
has not yet been fully adjudicated or denied, and before an appeal to 
the VA's Board of Veterans' Appeals (BVA) is required.
Historical Background
    The current restriction on attorney representation has its origin 
in the Civil War (1861-1865). At that time, Congress limited the fee 
charged by an attorney or ``claims agent'' to $10 for assisting a 
veteran to complete and submit a claim to the Pension Bureau for a war 
pension. This statute was passed to protect veterans from unscrupulous 
lawyers and claims agents whose aim was to steal the veterans' 
pensions. In 1865 there was no regulation of law practice by government 
or licensing of attorneys by bar associations. Anyone could hold 
himself out as an attorney or claims agent and, for a fee, assist a 
veteran claim a pension. Nonetheless, in 1865 the value of $10 was many 
times greater than today, and at that time this amount was a fair fee 
and reasonable incentive for attorneys to assist veterans.
    The statutory bar prohibiting a veteran from hiring an attorney 
evolved from this 1865 legislation because the $10 limit was never 
raised in the 123 years since then. With time, the $10 payment became 
meaningless. In the modern era, unless the attorney represented a 
veteran pro bono, the veteran could not legally hire an attorney for 
representation services before the VA. An attorney accepting a fee from 
a veteran greater than the authorized $10 would be committing a felony, 
and was subject to a fine and/or imprisonment. Over time, the primary 
proponents for not raising the $10 fee limit were the major VSOs, with 
the VA as their ally, the sole purpose of which was to prevent veterans 
from hiring attorneys.
    With passage of the VJRA in 1988, which VVA vigorously supported, 
the first major change in 123 years loosened the prohibition against 
the veterans' right to hire an attorney. The VJRA created the Veterans 
Court, giving veterans the right for the first time to appeal an 
adverse BVA decision to a Federal court of review. And, with the right 
to judicial review, Congress also allowed veterans the limited right to 
hire an attorney to represent them in the Veterans Court, as well as 
before the VA in cases the Veterans Court returned for re-adjudication. 
While an important step, the VJRA left in place the prohibition against 
veterans hiring an attorney for representation before the VARO and the 
BVA. Thus, although some veterans are currently free to hire an 
attorney in limited circumstances (i.e., where the case has first been 
through the entire VARO and BVA appeals process), most veterans remain 
prohibited from hiring an attorney.
    Because of their training in the law, attorneys generally can 
ensure that complicated claims are processed correctly and thoroughly 
from the outset. Having attorneys involved at the initial claims 
processing would help to ensure that the evidence is fully developed 
``up front,'' and that the VA is satisfying its legal duty to assist 
and complying with its own laws, regulations, and procedures. Also, 
attorneys are more likely to interpret, understand and apply new case 
law to veterans' claims. Just as important, attorneys also are well 
equipped to identify frivolous or non-meritorious issues, and would 
more likely ensure that these have been eliminated from a veteran's 
application for benefits. Attorneys are ethically bound to do so. 
Bringing a claim with little chance of success, only to be locked into 
a years-long battle with the VA does not serve the interests of the 
veteran.
    If attorneys were allowed to represent veterans before the VARO, 
this also would have the effect of facilitating more successful 
administrative appeals before it would become necessary to appeal such 
cases to the BVA or the Veterans Court. For example, attorney 
participation in the claims adjudication process would ``raise the 
bar'' on the part of VA adjudicators. Adjudicators would have to 
perform at higher levels of competency at the early stages of the 
process and would have to work a lot harder to justify denials of 
meritorious claims. Also, on average, an attorney would have a smaller 
caseload than most VSO service representatives. Therefore, the case of 
a claimant retaining an attorney to represent him or her during the 
entire claims process would likely receive significant individual 
attention, which would also free VSO service representatives to spend 
more time on their own veteran clients. All these effects will cause a 
reduction in the number of BVA and Veterans Court appeals and remands, 
leading in turn to a decrease in the backlog of claims. This outcome 
would be of great benefit to all veterans.

The Rehashed Arguments Against Allowing Veterans the Right to Choose 
        Their Representative Have Long Been Discredited
    The same arguments used to resist passage of the VJRA of 1988 are 
being asserted again to resist passage of the Veterans' Choice of 
Representation Act of 2006. Primarily, the rationale articulated by the 
major VSOs and the VA for their vehement support for perpetuating the 
bar to veterans choosing attorney representation is paternalistic, 
i.e., they argue that the veterans benefits system is non-adversarial 
and pro-claimant, and as such veterans and their benefits must be 
``protected'' from unscrupulous attorneys. Putting aside the merits of 
the argument that the VA benefits system is non-adversarial, the view 
that veterans need to be ``protected'' from attorneys simply has no 
basis in fact, and discriminates against veterans in comparison to the 
unfettered right of all other socioeconomic groups in our Nation to 
hire an attorney. There is no evidence that veterans have been abused 
by their attorneys (by charging exorbitant fees, for example) upon 
their being provided representation services before the Veterans Court 
and then on remand from the Court to the BVA.
    Also cited by the VA and some others as to why attorney 
representation of veterans is harmful and should not be allowed is 
that, by introducing attorneys into the mix during the initial claims 
process, VA adjudicators will be forced to take a more adversarial 
position when adjudicating claims. However, many veterans' advocates 
would argue that the VA adjudication process is already adversarial. 
Virtually any veteran who has been through this process will tell you 
that.
    The fact that this process is adversarial not necessarily because 
of the animus of VA adjudicators, but because of their heavy workload 
and the massive backlog of cases. It is far faster and easier for a VA 
adjudicator to deny a claim and let the next level decisionmaker fix 
any errors than it is to fully review the record, develop the evidence 
and make a thoroughly reasoned decision. With the assistance of an 
attorney at the start of a claim, the adjudicator's task can be 
streamlined to reviewing the evidence, developing the evidence as 
specified by the attorney, considering the attorney's legal and factual 
arguments and analysis, and rendering a decision. If the attorney fully 
develops the evidence as much as possible and writes a coherent 
argument, a favorable claims decision is essentially written for the 
adjudicator. Moreover, the adjudicator will have to work harder to find 
a justifiable basis to deny the claim.
    Another discredited ``doomsday'' argument is that allowing 
attorneys to represent veterans at the VARO level will result in undue 
competition with service representatives, perhaps even causing smaller 
VSOs to be driven out of the business of representing veterans. Such an 
outcome is highly unlikely. Allowing veterans the right to choose 
attorney representation will not diminish the critically important role 
of VA accredited VSO service representatives. As demonstrated by VVA's 
historical support for judicial review and the right to attorney 
representation, as well as its use of its own attorneys to represent 
veterans before the BVA and the Veterans Court, VVA has always viewed 
the roles of accredited service representatives and attorneys as 
complementary. Both groups train and learn from each other, and 
cooperate in the representation of VVA's veteran clients. The strength 
of accredited service representatives is in their front-line work in 
the field, developing claims and succeeding at the regional office 
level in most routine cases. The further up the appeal process a case 
must go, the more likely it presents complicated legal or factual 
issues, and is not routine. In such cases, especially at the appellate 
levels, the role of attorneys can be critical to providing veterans 
with quality representation.
    Moreover, there will never be enough attorneys representing 
veterans to assist them all. Nor would attorneys have any incentive to 
take all veterans as clients. Because attorneys will be paid, economic 
considerations will determine the number of veterans who will choose 
legal representation. For the same reason, no small VSOs will be put 
out of the business of representing veterans because of attorneys. Only 
a small percentage of veteran's benefits claims involve amounts of 
past-due compensation sufficient to create incentives for attorney 
representation. Because the vast majority of cases do not involve large 
awards of past-due benefits, the vast majority of veterans will 
continue to have their cases represented by accredited VSO service 
representatives.
    Yet another argument used in the past to resist attorney 
representation is that many attorneys have little or no training in VA 
laws, regulations and adjudication policies, which would result in 
inadequate representation or even legal malpractice. This is a ``red 
herring'' because, since the VJRA was enacted in 1988, there already 
have been a number of attorneys throughout the country practicing in 
this area of the law. It is true that more attorneys new to this 
practice will become involved if the current bar to attorney 
representation is repealed. However, ethical and other professional 
responsibility rules require attorneys to be competent to adequately 
represent their clients. Attorneys without direct experience with VA 
benefits laws and procedures should be at least familiar with how to 
obtain the information and learn what is necessary to provide adequate 
representation to veterans. This is not a new concept for attorneys. It 
is the method attorneys use with respect to every area of law in which 
they might practice.
    Lastly, opponents of allowing veterans' freedom of choice also 
argue that only those veterans with financial means will be able to 
afford attorney representation. In other words, they argue that poorer 
veterans will be unable to afford attorneys and thus will be 
disadvantaged in terms of the quality of their representation, causing 
disparate classes of benefits claimants. It is highly unlikely, 
however, that some veterans will be denied the benefit of attorney 
representation based solely on their inability to pay the attorney's 
fee. Virtually no veteran will be required to pay an attorney in 
advance for representation. The vast majority of veterans' cases 
handled by attorneys will be done on a contingent basis (no fee unless 
an award of past-due compensation is won), which is the case with the 
limited attorney represented cases that occur today. This means that 
the merits of the veteran's case will most likely determine his or her 
access to an attorney, not the veteran's financial standing.
    The overriding concern for VVA, as well as any other individual or 
group that cares about the rights of veterans, is that veterans get the 
most effective representation possible. If a veteran wants to hire an 
attorney as his or her representative at the VARO, is there a 
legitimate basis to deny them the right to do so? The position of VVA 
since its founding has been that no such basis exists. There should be 
no wavering from this same answer today.

              THE CHANGES PROPOSED IN THE NEW LEGISLATION

    Current law setting forth the limited circumstances and 
requirements for attorney representation for payment in veterans 
benefits claims is found at 38 U.S.C. 5904(c) (2000). There currently 
are three basic requirements. First and foremost, there must be a final 
adverse BVA decision with respect to the claim.\1\ (This first 
requirement means that a veteran with a case in a position to finally 
hire a lawyer has gone through the entire VA claims adjudication and 
appeals process without the right to have hired one. On average, this 
process takes three to five years to complete.) Second, the veteran 
must hire the attorney within 1 year of the date of the BVA decision. 
Third, compensation can be paid to the attorney only for services 
rendered after the date of the final BVA decision in the claim that was 
the subject of the BVA's decision to deny benefits. See 5904(c)(1).
---------------------------------------------------------------------------
    \1\ A BVA decision remanding a claim (to the VARO for further 
development of the record, and, or, re-adjudication) is not ``final.'' 
A BVA decision awarding benefits without denying any is not 
``adverse.'' Neither is a decision appealable to the Veterans Court, 
nor one about which an attorney may be retained by the veteran.
---------------------------------------------------------------------------
    The BVA has promulgated regulations requiring the attorney to file 
a copy of any attorney-fee agreement with a veteran with the VARO and 
BVA. When a fee becomes payable, the VARO first reviews the agreement 
to determine that all the requirements for payment of a fee have been 
met. Later, the BVA has the authority to entertain any allegation that 
the fee charged by the attorney is excessive or unreasonable. If so, 
the BVA may order a reduction in the fee called for in the agreement. 
See id. at 5904(c)(2). The BVA's regulations provide that an attorney 
fee of 20 percent or less is presumed to be reasonable.
    In addition, the attorney can choose to have the VARO withhold his 
or her fee and be paid directly by VA. If this payment procedure is 
used, the attorney-fee amount cannot exceed 20 percent of the amount of 
past-due benefits paid to the veteran on the basis of the claim. See 
id. at 5904(d)(1).
    In the proposed Veterans' Choice of Representation Act of 2006, the 
requirement that there be a final adverse BVA decision before the 
veteran may retain an attorney is eliminated in favor of allowing this 
at the point the veteran a claim for benefits before the VARO. All of 
the current provisions providing for VA oversight of the attorney-fee 
agreement with the veteran would be kept in place; that is, the 
requirements that the attorney-fee agreement be submitted to the VA and 
that the fee must not be excessive or unreasonable continue as before. 
The essential effect of the change is to allow veterans to hire an 
attorney while their claims are still in the early stages of 
adjudication at the VARO level of the claims process.

                     THE VETERANS' RIGHT TO CHOOSE

    By virtue of the title of the legislation itself--Veterans' Choice 
of Representation Act of 2006--the problem it seeks to redress is 
readily apparent. Unless the veteran decides to be his or her own 
representative, or is able to find a volunteer attorney, by law the 
only choice of representation currently available is a service 
representative from a VSO. Recently, a World War II veteran and long-
time attorney representing other veterans as a volunteer has described 
the notion that veterans are not capable of competently deciding who 
will represent them in a VA matter as ``flabbergasting.'' \2\
---------------------------------------------------------------------------
    \2\ See ``Who Can Fight for the Soldiers?--Veterans Need the Right 
to Hire a Lawyer'' by John C. McKay, The Washington Post, Opinion 
Section (Sunday, January 22, 2006).
---------------------------------------------------------------------------
    Although veterans are considered mature and responsible enough to 
choose to serve their country, they are seen as lacking such 
capabilities with respect to choosing legal representation. This 
limitation, and the patronizing reasoning behind it, sets veterans off 
from every other discrete group of the American population. No other 
group--including illegal aliens and felons in penal institutions--is 
barred from making a free choice about who will be their legal 
representative in matters personal to them that may be pending before 
the government.
    If any group has earned the right to choose whether or not to hire 
an attorney, it is our Nation's veterans. There simply is no 
justification for refusing veterans this basic right that is taken for 
granted by every other segment in our society.
    Aside from the basic moral imperative of allowing veterans the 
choice to freely pick their representation, there are other very 
practical reasons veterans would desire this right. Primarily, the VA 
benefits system is rife with problems about which attorneys possess 
special skills to address. Even though intended to be ``non-
adversarial,'' the VA benefits system is nonetheless inherently 
complicated. There are numerous claim forms, confusing terminology, 
multiple deadlines for the submission of evidence and arguments, 
unpublished rules, numerous sources of military and medical records 
vital to a successful claim, and legal requirements that even VA 
adjudicators do not easily understand. Because of the complex nature of 
the veterans benefits system, and the lack of qualified VA 
adjudicators, there is a tremendous backlog of claims awaiting 
adjudication by VA. Because VA decision-making is so poor, adding to 
the backlog of cases are hundreds of cases each month returned to the 
VAROs from the BVA and the Veterans Court to correct errors. A veteran 
typically can be stuck in the VA claims process for years. In the 
present system, however, a lawyer cannot become involved in the case 
until it is too late, i.e., after the initial evidence development and 
adjudication has already occurred.
    Vietnam Veterans of America strongly and unreservedly supports S. 
2694 by convention resolution VB-14-95 ``Attorney Representation at 
VA'' (copy attached). We urge its endorsement by this Committee and 
passage by both houses of Congress. Our hope is that once this 
milestone is achieved we can move quickly to real judicial review by 
the Federal courts.

             S. 2562, VETERANS' COLA ADJUSTMENT ACT OF 2006

    S. 2562 would increase the current levels of disability 
compensation, additional compensation for dependents, the VA clothing 
allowance, and the various rates of Dependency and Indemnity 
Compensation (DIC) for disabled veterans and their families. The 
percentage increase would be equivalent to the percentage of the cost-
of-living adjustment (COLA) for Social Security beneficiaries, and 
would become effective as of December 1, 2006. These COLA increases are 
absolutely necessary to prevent veterans and their dependents from 
falling through inflationary cracks.
    VVA would also seek language in this legislation to include COLA 
increases for children receiving $250 DIC compensation. DIC payments 
are not affected by COLA increases.

                 S. 2121, VETERANS HOUSING FAIRNESS ACT

    S. 2121 is a worthy piece of legislation. In some areas of the 
country, co-ops--the two-syllable colloquialism for cooperative housing 
corporations--have been off-limits to veterans seeking to secure a VA-
guaranteed loan to purchase residential cooperative apartment units. 
Mr. Schumer's sensible bill would remedy this, providing thousands of 
veterans residing in urban areas with a housing option currently closed 
to them.
    VVA endorses S. 2121.

         S. 2659, NATIVE AMERICAN VETERANS CEMETERY ACT OF 2006

    American Indians have served in every war fought by the United 
States of America. During World War I approximately 12,000 served with 
the American Expeditionary Force and many distinguished themselves in 
the fighting in France. In World War II, more than 44,000 fought 
against the Axis forces in both European and Pacific theaters. These 
Americans compiled a distinguished record of courage and sacrifice. 
More than 42,000 American Indians fought in Vietnam. American Indian 
contributions in United States military combat continued in the 1980s 
and 1990s as they saw duty in Grenada, Panama, Somalia, and the Persian 
Gulf.
    Native Americans continue to play a major role in the armed 
services with nearly 11,000 on active duty today.
    VVA believe it is time that Native American veterans who served our 
country so honorably are allowed to pursue a decent, dignified resting 
place on their tribal lands and fully supports S. 2659.

         S. 2416, VETERANS EMPLOYMENT AND TRAINING ACT OF 2006

    The GI Bill is marketed toward youth. It is portrayed through mass 
advertising in such a skewed light that there is a common albeit 
mistaken, perception among the general public that the GI Bill will 
send a veteran through 4 years of college. The reality is far 
different. Today's GI Bill will pay on average a little more than one-
fourth the amount of 4 years expenses at a state university at in-state 
costs. Long gone are the days of former infantrymen walking the halls 
of Yale and Stanford. The fact that qualified veterans are by and large 
excluded, due to their economic stations in life, from the top, 
prestigious institutions that churn out tomorrow's leaders, is not only 
detrimental to veterans, but is a real blow to this Nation.
    VVA believes that the time has come for a serious overhaul of the 
existing Montgomery GI Bill. A truly substantial GI Bill, one modeled 
on that accorded to World War II veterans that transformed America, 
built the middle class, and was an essential ingredient in building the 
greatest sustained economic engine in the history of the world, is what 
is needed today. Additionally, we need to restore the apprenticeship 
and explicitly directed vocational emphasis in the GI Bill to meet the 
needs of many of our newest veterans. This is one benefit that will, in 
turn, benefit this Nation for generations to come, returning many times 
over the investment in dollars to the Treasury, as well as greatly 
aiding in growing our Gross Domestic Product.
    S. 3363--VVA supports this amendment to Chapter 35 Subtitle IV of 
38 U.S. Code that would extend an accelerated education payment program 
to dependents and survivors under the Montgomery GI bill. This benefit 
is extremely useful in non-degree education/training programs that will 
directly lead to meaningful employment.
    Mr. Chairman, again all of us at VVA thank you for this opportunity 
to present our views on these improvements in vital veterans benefit.

                   ATTORNEY REPRESENTATION AT THE VA

    (VB-14-95)
Issue:
    American veterans are unable to pay for legal services until after 
their case has gone past the Board of Veterans' Appeals.
Background:
    Legal counsel at the Court of Veterans Appeals for Claims for 
Claims is allowed to present no new evidence. Allowing veterans legal 
counsel at the initiation of their claim would give that claim a legal 
continuity. Legal counsel is the right of all Americans, except 
veterans.
Resolved, That:
    Vietnam Veterans of America actively seeks and supports legislation 
allowing veterans to access legal counsel at any point in their claim.
    Financial Impact Statement: In accordance with motion 8 passed at 
VVA January 2002 National Board of Directors meeting which charges this 
Committee with the reviewing its relevant Resolutions and determining 
an expenditure estimate required to implement the Resolution, presented 
for consideration at the 2005 National Convention; this Committee 
submits that implementation of the foregoing Resolution shall be at no 
cost to National.

    Chairman Craig. Richard, thank you very much.
    Now let us turn to Bart Stichman, Co-Director of National 
Veterans Legal Services Program.
    Bart, welcome before the Committee.

STATEMENT OF BARTON F. STICHMAN, CO-DIRECTOR, NATIONAL VETERANS 
                     LEGAL SERVICES PROGRAM

    Mr. Stichman. Thank you, Mr. Chairman, for the opportunity 
to testify. I would like to focus my remarks this morning on S. 
2694.
    A major part of the mission of the National Veterans Legal 
Services Program since we were formed in 1980 has been training 
lawyers and non-lawyer representatives in veterans law. We have 
trained, over the last 26 years, thousands of lawyers and non-
attorney representatives in veterans law. And that helps inform 
my written testimony and oral testimony today.
    I ask that the written testimony be made part of the 
record. I would like to highlight----
    Chairman Craig. Without objection, it will be. Thank you.
    Mr. Stichman [continuing].--I would like to highlight two 
points in that testimony. First, the Veterans Service Officer 
network is greatly overburdened today with a staggering 
caseload.
    As you know, over the last 5 years, the number of claims 
has increased by 36 percent. The VA expects over 900,000 new 
claims this year. In a recent National Law Journal article, it 
reported that the cases of 18,000 VA claimants pending before 
the VA regional office in St. Petersburg were being handled by 
14 service officers employed by a major national Veterans 
Service Organization. At the Los Angeles VA regional office, 
the cases of 9,000 VA claimants pending before that office were 
being handled by 9 service officers employed by that same 
organization.
    This amounts to over 1,000 pending claims for each service 
officer. No service officer, no matter how well trained, can 
devote a lot of time to an individual disabled veteran's case 
when he or she has to handle more than 1,000 clients at the 
same time.
    Enactment of S. 2694 will have the important positive 
effect of increasing the pool of advocates available to 
represent the increasing number of disabled veterans who are 
seeking VA benefits. This, in turn, will lighten the 
overwhelming caseload borne by the service officers. It will be 
a win-win situation for veterans, the service officers, and 
attorneys.
    The second point I would like to emphasize in my testimony 
has to do with the arguments against allowing attorneys into 
the system that have been made this morning: that it will make 
the system more adversarial. I have a sense of deja vu. I have 
heard these same arguments in 1988 when Congress was debating 
whether to authorize judicial review of VA decision-making. The 
arguments have not changed. The people who are being quoted are 
the same people, Chief Judge Rehnquist from a 1985 decision, 
judges who spoke in 1988, but that is 18 years ago. What has 
happened in the last 18 years?
    When Congress enacted the Veterans' Judicial Review Act, 
they actually allowed attorneys into the VA system to be hired 
by veterans in a limited sense. When there is a denial by the 
Board of Veterans' Appeals, Congress allowed, beginning in 
1988, veterans to hire lawyers to reopen their claim at the 
regional office or to represent them for a fee on remand from a 
court proceeding.
    The Board of Veterans' Appeals denies about 10,000 claims 
each year. Since 1988, 180,000 claims have been denied by the 
BVA and an opportunity to hire a lawyer has existed. Some of 
the veterans in these 180,000 cases have given up. Some of the 
veterans have used Veteran Service Officers to reopen a claim, 
or represent them on remand from court. And some have hired 
attorneys. So, we have had 18 years of experience with lawyers 
to some degree in the VA system. As a former Senator said, 
where is the beef? Where is the evidence that lawyers have 
caused the VA system to be more adversarial?
    The VA and the others who have testified against your bill 
have not cited any evidence. I know of no evidence. The sky has 
not fallen, to my knowledge, because some lawyers have been 
involved in the VA system. If you want to know the impact of 
attorneys on the system, ask the clients of those attorneys how 
they felt when they were represented and whether they were 
helped, and whether it was worth the money to have paid the 
attorney to, hopefully, win the case. That is the type of 
record that would need to be made and is not being made to show 
that the system would be made worse by the introduction of 
attorneys.
    I would be pleased to answer any questions the Committee 
may have.
    [The prepared statement of Mr. Stichman follows:]

    Prepared Statement of Barton F. Stichman, Co-Director, National 
                       Veterans Services Program

    Mr. Chairman and Members of the Committee:
    I am pleased to be here today to present the views of the National 
Veterans Legal Services Program (NVLSP) on S. 2694, the ``Veterans' 
Choice of Representation Act of 2006.'' NVLSP is a veterans service 
organization with a unique perspective on the merits of this 
legislation. Since NVLSP was established in 1980, we have trained 
thousands of veterans service officers and lawyers in veterans benefits 
law. We have also written educational publications that have been 
distributed to thousands of veterans advocates to assist them in their 
representation of VA claimants. This experience has helped us in 
formulating our position.
    NVLSP strongly supports enactment of S. 2694. As I discuss in more 
detail below, we support S. 2694 for many of the reasons that Senators 
Craig and Graham identified when they introduced this legislation.

            THE MAJOR REASONS THAT S. 2694 SHOULD BE ENACTED

    1. Freedom of Choice. In his press release of May 4, 2006, Senator 
Craig answered yes to the following question: ``If American soldiers 
are mature and responsible enough to choose to risk their lives for 
their country, shouldn't they be considered competent to hire a 
lawyer?'' NVLSP agrees entirely. Veterans deserve the right to choose 
to hire an attorney to represent them on a claim for VA benefits. It 
makes no rational sense to deny them this right when the right to 
choose to hire an attorney is enjoyed by criminal defendants, claimants 
for other Federal Government benefits including social security, and 
non-citizens opposing Federal Government efforts to deport them. As one 
observer aptly put it, the current, 144-year-old statutory bar to 
hiring an attorney to help a disabled veteran on a VA claim is a 
``museum piece'' that deserves to be repealed.
    2. The Overburdened Veterans Advocacy Network. Another major reason 
that NVLSP supports S. 2694 is that the current network of veterans 
advocates available to our Nation's disabled veterans is greatly 
overburdened. As I explain in more detail below, the time that veterans 
service officers can devote to an individual disabled veteran's case is 
greatly limited by the daunting caseload they must carry. Allowing 
disabled veterans to hire attorneys will help alleviate this burden and 
promote justice.
    The number of disabled veterans who need representation on their 
claims before the VA is staggering, and it is increasing over time. 
Thomas J. Pamperin, Assistant Director of the VA's Compensation and 
Pension Service, recently quantified for NVLSP the upsurge in VA 
claims. He stated:
    As reported in the President's budget submission for fiscal year 
2007, disability claims from returning war veterans, as well as from 
veterans of earlier periods, have increased 36 percent between 2000 and 
2005. VA projects that disability claims in 2006 will increase to an 
estimated 811,947, an increase of 23,649, based on the increasing claim 
rate. We project an additional 98,178 more claims as a result of 
specific legislation contained in VA's appropriation for 2006 mandating 
personal contact with veterans in six states (the ``outreach effort''). 
Thus, we anticipate a total of 910,126 disability claims in 2006 
compared to actual receipt in 2005 of 788,298, an increase of 121,828 
claims . . . Furthermore, VA is currently working on initiatives to 
conduct outreach to potential non-service-connected, pension-eligible 
wartime veterans and survivors.
    A recent article in the National Law Journal (a copy of which is 
attached hereto) gives a glimpse of the heavy load that is being 
carried by our Nation's veterans service officers. The National Law 
Journal reports that as of 2003, the cases of 18,000 VA claimants 
pending before the VA regional office in St. Petersburg were being 
handled by 14 service officers employed by a major national veterans 
service organization. The cases of 9,000 VA claimants pending before 
the VA regional office in Los Angeles were being handled by nine 
service officers employed by the same organization.
    This amounts to over 1,000 pending claims for each service officer. 
No service officer--no matter how well-trained--can devote a lot of 
time to an individual disabled veteran's case when he or she has to 
handle 1,000 or more clients at the same time.
    Enactment of S. 2694 will have the important positive effect of 
increasing the pool of advocates available to represent the increasing 
number of disabled veterans who are seeking VA benefits. This, in turn, 
will help lighten the overwhelming caseload borne by many service 
officers. Most disabled veterans will undoubtedly choose to continue to 
be represented by a service officer who by law provides this service at 
no cost. But disabled veterans who are represented by a service officer 
will be benefited because the service officer will have more time to 
devote to their case.
    3. Improving Veterans' Access to the VA and Expediting Just 
Outcomes. In Senator Craig's May 6th press release, he quoted Senator 
Graham as stating that ``[t]his overdue change will significantly 
improve veterans' access to the VA and expedite just outcomes.'' 
Senator Graham went on to state that ``[i]n today's complicated world, 
legal assistance in navigating the system is more timely than ever.'' 
NVLSP strongly agrees with this assessment.
    In the first place, NVLSP can vouch for the fact that the Federal 
veterans benefits system has always been highly complex. To assist 
service officers and attorneys in representing veterans in this system, 
NVLSP has written the Veterans Benefits Manual (``VBM''), which has 
been published since 1999. The fact that the VBM is over 1,700 pages 
long reflects the complexity of the system. I should note that because 
important changes in veterans benefits law take place every year, a new 
edition of the VBM is published annually.
    NVLSP also agrees with Senator Graham that enactment of S. 2694 
would expedite just outcomes in this complex system. For example, in 
11,833 of the 15,823 appeals (or 74.8 percent) that the U.S. Court of 
Appeals of Veterans Claims decided on the merits during the last 10 
fiscal years, the Court was forced to remand the case back to the VA 
for further proceedings. Similarly, in 51,675 of the 121,174 cases (or 
42.6 percent) heard by the Board of Veterans' Appeals during the last 
three fiscal years, the Board was forced to remand the case back to a 
VA regional offices for further proceedings.
    A large percentage of these Court and Board remands are caused by 
the failure of the regional offices to comply with the nonadversarial 
VA procedures required by law in a way that prejudiced the veteran's 
case. For example, some claims have had to be remanded because the 
regional office failed to inform the disabled veteran of the evidence 
necessary to substantiate the veteran's claim as required by 38 U.S.C. 
5103. Some claims have had to be remanded because the regional office 
failed to obtain the veteran's service department records, Social 
Security records, or private medical records, or to provide the veteran 
with a medical examination as required by 38 U.S.C. 5103A. Some claims 
have had to be remanded because the regional office failed to obtain a 
medical opinion addressing whether the veteran's current disability is 
related to an event, injury, or disease that occurred during the 
veteran's military service as required by 38 U.S.C. 5103A. These 
remands delay, sometimes for years, the ultimate resolution of a 
disabled veteran's claim that has already taken years to reach the 
Board of Veterans' Appeals or the Court of Appeals for Veterans Claims.
    But forcing the Board or the Court to make VA regional offices 
comply with these nonadversarial requirements is not the only way for a 
disabled veteran to have his claim fairly decided. If the obstacle to a 
fair decision is that the regional office failed to inform the disabled 
veteran of the evidence necessary to substantiate the veteran's claim, 
a service officer or lawyer can remove that obstacle early in the 
claims process by simply informing the disabled veteran about the 
evidence that is necessary. If the obstacle to a fair decision is that 
the regional office failed to obtain a medical nexus opinion or a 
veteran's service department records, Social Security records, or 
private medical records, a service officer or lawyer can remove that 
obstacle early in the claims process by obtaining this evidence 
themselves and submitting it to the regional office.
    Given the current heavy caseload borne by the Nation's service 
officers, many of them simply do not have enough time in every case to 
analyze the claim and to obtain and submit the evidence that the VA 
regional office was obligated by law, but failed, to obtain. Enactment 
of S. 2694 should help alleviate this overload by making additional 
advocates available to our Nation's veterans to assist them on their VA 
claims. This, in turn, will increase the amount of time these advocates 
have to devote to an individual case, thereby allowing them early in 
the claims process to remedy the regional office's failure to comply 
with the nonadversarial procedures required by law. The net result, as 
Senator Graham stated, will be to ``expedite just outcomes.''
    I want to stress that in the experience of NVLSP, most service 
officers are well-trained, knowledgeable, and dedicated to helping 
veterans obtain the benefits they deserve. Adding attorneys to the mix 
of advocates who can represent veterans before the VA will ease the 
workload of many overburdened service officers and allow them to spend 
more time per case helping veterans. This legislation would add more 
advocates to the mix, and protect veterans from unreasonable fees. It 
is a ``win-win'' for both veterans and for service organization 
representatives.

An Argument Raised Against S. 2276: It Will Allegedly Make the VA 
        System More Adversarial
    Finally, I would also like to address an argument we have heard 
some make against allowing veterans freedom to choose to hire a lawyer 
on any VA claim. That argument is that the introduction of lawyers will 
make the VA claims adjudication system more adversarial.
    The basic flaw in the argument is that there is no evidence to 
support this notion. Over the last five fiscal years, lawyers have 
represented VA claimants before the Board of Veterans' Appeals in 
13,021 of the 152,731 cases (or 8.53 percent) decided by the Board. 
Thousands of VA claimants have been represented by lawyers before VA 
regional offices. If lawyers would make the VA claims adjudication 
system more adversarial to the detriment of VA claimants, then there 
would already be evidence of this phenomenon. To NVLSP's knowledge, 
there is no such evidence.
    In conclusion, NVLSP greatly appreciates the opportunity afforded 
to us by the Committee to address the merits of S. 2694. We believe 
that there are some technical amendments to S. 2694 that would further 
the objectives of the bill, and we intend to provide them to the 
Committee in writing in the near future. That concludes my prepared 
statement, and I would be happy to answer any questions.

    Chairman Craig. Thank you very much.
    Before we turn to any questions of the panel, we have been 
joined again by Senator Thune.
    John, do you have any opening statement or comments or 
questions you would like to direct to this panel?

                 STATEMENT OF HON. JOHN THUNE, 
                 U.S. SENATOR FROM SOUTH DAKOTA

    Senator Thune. I thank you, Mr. Chairman. I would like to 
make just a couple of comments and then I do have a question 
that I would like to ask this panel. I appreciate you holding 
this hearing and taking a look and hearing from all about the 
range of initiatives and legislation that is moving through the 
Congress up here that would address veterans benefits. 
Obviously, we all have a bipartisan desire, and that is to see 
that we ensure the veterans who faithfully served our country 
receive the benefits that they have earned. And that the 
veterans in this country know that we stand behind them in the 
policies that we put in place.
    As we look at the bills on the agenda today, I also want to 
just make a couple of remarks about a bill I introduced shortly 
before the Memorial Day break, and that is Senate Bill 3068, 
which picks up on something one of your bill does, Mr. 
Chairman, that is to extend the COLA through 2007 for veterans 
disability. What my bill would do would just make that 
permanent.
    It is something that the cost is already assumed in the 
budget baseline, and therefore does not have a budgetary 
effect. Social Security and Medicare have automatic COLAs and I 
think the veterans deserve the same security. And so I hope 
this Committee would be able to support that bill. It is a good 
bill that, again, has a neutral budgetary effect and it is a 
small way, I think, of giving our disabled veterans a little 
more peace of mind as they face the challenges of everyday 
life.
    I have a question with respect to the whole issue of hiring 
lawyers, as well. I know there has been some discussion of this 
on the last panel. I would be curious to get some comments from 
this panel. I know that the process is designed not to be 
adversarial and to promote a high degree of solicitude for our 
veterans. I am sensitive to that side of the argument, as well.
    But, I guess I am curious to know if there are any other 
instances aside from the VA benefits claims process where 
adults are restrained by law from hiring an attorney. This 
seems to me to be a pretty rare exception. I think this 
question was raised earlier, but if any of you are aware of 
anybody that draws Social Security benefits that is prevented 
from being able to retain an attorney to pursue that.
    One of the problems with the Board of Veterans' Appeals 
that we have is the significant backlog, and I guess I am 
interested in just getting your observation about what effect 
allowing veterans to hire lawyers at any stage in the process 
would have on--would it increase the likelihood that backlogs 
would become more significant or would it be likely to 
streamline the process? I mean, what is your take on that 
particular--that is an issue that, I think, is of great 
interest.
    Mr. Kinderman. Mr. Thune, Quentin Kinderman with the 
Veterans of Foreign Wars.
    We believe--I think we are alone at the table here--in that 
we do not favor attorneys practicing in regional offices. We 
believe that if there were only a few attorneys, it would 
probably have a nominal effect. So, you cannot really predict 
what is going to happen until you know how many attorneys will 
end up practicing.
    But we believe that the strategies that the attorneys will 
use and the efforts they will go to assure that they do 
everything on behalf of their clients will, in fact, make the 
claims process more labor intensive. So, yes, if attorneys 
practice in the regional offices to a significant extent, we 
believe that we would see backlogs increase, unless VBA has a 
commensurate increase in their capacity to do work. We do not 
see that.
    Mr. Stichman. If I might interject. I believe just the 
opposite. The claims process will speed up by the introduction 
of attorneys and let me explain why.
    I mentioned before the high caseload maintained by Veteran 
Service Officers. Because they have such a high case load, they 
are forced to rely on the non-adversarial system for the VA to 
assist the claimant by going out and getting Social Security 
records, service medical records, private medical records. And 
the veteran has to wait for the VA to do those things, or, if 
it does not do it, for the service officer to contest that by 
appeal to the Board of Veterans' Appeals.
    Lawyers with a lower caseload do not need to wait. They 
typically, from my experience, go out and get those records. 
Even though the VA is required to get it, they go get the 
records, submit it, and package the case so that the VA can 
quickly decide it.
    I was at a veterans law conference recently, where the 
Deputy Service Manager of the Baltimore regional office of the 
VA was talking about how wonderful it is to get a package case. 
She loves when a claim comes in and has all the evidence. The 
VA does not have to go out and get it because the attorney has 
already done that and has the time to do that.
    Those cases are decided quickly and favorably. And if you 
have people with more time, that is going to happen more.
    Mr. Weidman. I would like to second that, Senator. The 
better prepared the case is with laying out the law, cogently 
summarizing the argument as to why the individual qualifies for 
the benefit for the compensation under that. Then, have the 
evidence that is cited, tabbed, the same way an attorney would 
in any filing of any significant brief. Attorneys know how to 
do that. And when you give that to the VA, it can be 
adjudicated in 15 to 30 minutes. Period. It is either there or 
it is not there, and attorneys are used to doing that.
    Judge Ivers. Senator Thune, I might add from the 
perspective of having sat on the court for 15 years and 
observed the significant number of cases that were remanded for 
record insufficiencies, that having attorneys preparing the 
record helped change my perspective on whether or not attorneys 
should be allowed at the regional office level. I think 
preparation of the record is key. The more concise that record 
is and the more complete that record is, the better it is for 
review by the court. I think that would help reduce the number 
of remands from the court.
    I am not sure how many attorneys will appear at the initial 
stages. That would remain to be seen, as everybody has pointed 
out. But any case that comes before the court that has a 
complete and well documented record is going to get a complete 
review on the merits because the essential record is all there 
for the Court to look at.
    Senator Thune. I appreciate that. That is a great 
perspective. I think that is a concern, obviously, that 
whatever we do, we want to make sure that it does not add to 
the backlog and the delays and the slow downs that currently 
exist. It seems to me that it would. If you have got folks like 
attorney who are carefully organizing and putting together the 
evidence, so to speak, and being able to make a very coherent 
argument that it could have a streamlining effect.
    But I think you stirred up here, a little bit, Mr. 
Chairman, with your bill, but I appreciate the opportunity to 
hear from the organizations that would be most affected by this 
and want to work with you to make sure that we are serving our 
veterans in the best manner possible. Hopefully, taking steps 
to streamline the process to avoid the backlog and make some 
headway in terms of just providing, I guess, a better level of 
service when it comes to processing claims.
    I appreciate very much your perspective on that and, again, 
look forward to moving forward with the legislation. Thank you, 
Mr. Chairman. I thank the panel.
    Chairman Craig. Members of the panel, I want to thank you 
all for your presence and your opinions. I think they are 
extremely valuable for the record. My concern is equal to 
yours, as it relates to case backlog and veterans being treated 
fairly and timely, as it relates to the claims process.
    We have a full complement at the court now. We have visited 
it. We are listening. We are watching. We are trying to 
understand where the problems rest. I know Quentin expressed 
his concern and, it is a concern of ours. It has been expressed 
by all of you, certainly the two of you--and also Richard. As 
you heard the VA, it is pretty hard to argue the principle that 
is reflected in the legislation, but we find it inherent to 
defend the status quo.
    The status quo is not serving our veterans, as we speak. 
There are numerous reasons for it. I think Quentin, you 
reflected some of those: proper training, educational 
processes, making sure it is done right. That is one of the 
reasons why I began to look at the possibility of taking down 
this old restriction and opening up the opportunity for a 
broader constituency out there of professionals that could 
facilitate and assist our veterans.
    We will see where it takes us. It is a worthy and important 
debate to determine whether we move in this direction. Judge 
Ivers, I think I am much closer to where you are as it relates 
to the maturing of a process and of an approach that we are 
into now, as it relates to veterans claims and how they get 
handled effectively.
    As my statement reflected, this is a policy in place of 
long-standing that may no longer serve our veterans well, so we 
are going to take a hard look at it.
    Gentlemen, thank you very much for being with us today. We 
appreciate it. The Committee will stand adjourned.
    [Whereupon, at 11:50 a.m., the hearing was adjourned.]

                            A P P E N D I X

                              ----------                              

            Prepared Statement of Hon. Charles E. Schumer, 
                       U.S. Senator from New York

    Good morning Chairman Craig, Ranking Member Akaka. I want to thank 
you and other Members of the Senate Committee on Veterans Affairs for 
giving me the opportunity to testify on the importance of the Veterans 
Housing Fairness Act of 2005 (S. 2121).
    I come here today to speak in support of a very important issue, 
veterans housing benefits. Everyone should be afforded the basic right 
of having a roof over their heads and a safe and decent place to live. 
No one should be left out in the cold, especially not our Nation's 
veterans. The veterans of this country are the hard working men and 
women who put their lives on the line to uphold the basic freedoms that 
our country provides. These veterans are the men and women who proudly 
served our country in World War II, the Korean War, Vietnam and the 
Persian Gulf War.
    And today, we have thousands of troops putting their lives on the 
line in Iraq. These men and women who are in Iraq today will soon be 
our newest generation of veterans. We need to ensure that we provide 
all of our hard working veterans with the very basic rights, such as a 
roof over their heads, after they put their lives on the line to 
protect our rights as a Nation.
    Today veterans face many problems when trying to secure safe, 
decent and affordable housing. In many areas throughout the country, 
including New York City, the cost of houses, condominiums, townhouses 
and even mobile homes can be exorbitantly high. Sky-rocketing housing 
prices combined with a lack of affordable housing units increase the 
likelihood for veterans to be homeless, which is a growing problem. 
According to the Department of Veterans Affairs, 250,000 of our 
Nation's veterans are homeless--12,000 of them are concentrated in New 
York City alone.
    I am committed to ensuring our Nation's veterans receive the best 
housing benefits, which is why I have introduced the Veterans Housing 
Fairness Act in the previous two Congresses, and have re-introduced 
this important legislation in the 109th Congress.
    Under current law, veterans may use their VA housing loans to 
purchase a house, townhouse, condominium, or mobile home, but they are 
not able to purchase cooperative residential units with these loans. 
Cooperative residential units, however, provide another affordable 
alternative. My legislation, the Veterans Housing Fairness Act of 2005, 
will expand the authority for VA home loan benefits to add this 
important option for home ownership in a changing marketplace, which 
will be a great asset to our Nation's veterans.
    In certain areas of New York, such as New York City, cooperative 
housing comprises as much as 30 percent of all residential owned 
housing. Cooperative housing units are certainly not unique to the 
State of New York. Outside of New York, there are over 15,000 
cooperative townhouses in southeastern Michigan, 25,000 units in the 
greater Washington D.C. area, 5,000 in Kansas City, and over 30,000 in 
the state of California.
    Other government agencies, such as FHA, currently have programs to 
give loans for cooperative residential units. There is no reason to 
deny veterans the ability to use their VA housing loans to purchase 
these same units. S. 2121 will allow veterans to explore all housing 
options and choose the one that best suits their needs, which will 
increase the amount of affordable units, and will stem the tide of 
homeless veterans.
    This legislation would still ensure that a veteran can use his or 
her VA housing Loans to purchase stock or membership in a single family 
residential unit, much like the units in condominiums. My bill would 
also comply with criteria established by the Secretary of Veterans 
Affairs.
    I am proud to announce that the American Legion, Paralyzed Veterans 
of America (PVA), and the Veterans of Foreign Wars of the United States 
(VFW) have all endorsed this legislation, and the Disabled Association 
of Veterans (DAV) has acknowledged that this would be beneficial to 
veterans and their families.
    At a time when housing prices can far exceed a person's means, it 
is important to present veterans with all options so that they too can 
have the opportunity to purchase an affordable home. We need to ensure 
that every American citizen--especially those who fought long and hard 
for our country--has an opportunity to live the American dream of 
homeownership. I urge my colleagues to support the Veterans Housing 
Fairness Act of 2005, and I thank Chairman Craig and Ranking Member 
Akaka for the opportunity to discuss this important issue.
                               __________
     Prepared Statement of Hon. Mike DeWine, U.S. Senator from Ohio

    I want to thank Chairman Craig and Ranking Member Akaka for 
inviting me to discuss legislation that will benefit the survivors and 
dependents of our deceased servicemembers. I appreciate your steadfast 
dedication to improving benefits for our Nation's veterans and their 
families. These families embody courage, patriotism, and dedication.
    As you know, more than half of America's men and women in uniform 
are married and about half of those families also have children. These 
families supply endless support for our servicemen and women and I 
believe we need to provide them that same support in the event that 
they are killed while serving on active duty.
    My legislation, S. 3363, which you will consider today, would pay 
most of the education benefit upfront for survivors and dependents who 
are pursuing an education in high-tech fields each semester. These 
accelerated payments would be granted to students pursuing programs in 
life science or physical science, engineering, mathematics, engineering 
and science technology, computer specialties, and engineering, science, 
and computer management. Accelerated payments for these programs are 
currently available to GI Bill recipients and are helping our country 
educate a much needed workforce in the following high-tech fields: 
biotechnology, life science technologies, opto-electronics, computers 
and telecommunications, electronics, computer-integrated manufacturing, 
material design, aerospace, weapons, and nuclear technology.
    I am thankful that the Committee has agreed to take a look at my 
legislation--which represents the first step toward improving the 
education benefit for survivors and dependents--but I am hopeful that 
this Committee will also consider revisiting the policy regarding the 
survivor education benefit. Conceptually, the Survivors' and 
Dependents' Educational Assistance Program was established to provide a 
partial education benefit. I think that it is time to again discuss the 
intent of this program. We owe our deepest gratitude and support to 
families who have lost loved ones while on active duty. Think of the 
children who will grow up without their parent. The uniformed mother or 
father of these children will never again sit at the dinner table to 
help with homework, watch proudly as their child receives his or her 
high school diploma, or help pack the car to move their new student to 
college.
    Last fall I introduced S. 2014, which would provide each eligible 
beneficiary access to a college education. This bill would eliminate 
the current 45-month cap on benefit payments and establish a $80,000 
lump sum that can be drawn down for any educational expenses, including 
tuition, fees, room, board, and books. Under current law, a survivor 
only has access to about $37,215 if he/she attends college or a trade 
school on a full-time basis. As we know, this amount would not even 
guarantee a survivor access to a college degree from many state 
universities today. In fact, let's use the Ohio State University as an 
example. This public institution will cost in-state students roughly 
$15,285 for the 2005-2006 school year, which includes tuition, room, 
and board. Now, if there were no cost increases over the course of a 4-
year matriculation--which, in this day and age is an unrealistic 
assumption--a degree from Ohio State would cost $61,140. This amount is 
$23,925 more than the current benefit that is available from the 
Department of Veterans Affairs. Clearly a gap exists.
    Again, I appreciate the Committee's commitment to ensuring our 
veterans, survivors, and their families have fair and adequate 
benefits. I look forward to working with you as S. 3363 moves through 
the Senate. This benefit improvement will not only improve the United 
States' high-tech workforce, but will also provide easier financial 
access to a high-tech education for our military survivors and their 
dependents.

 Prepared Statement of Peter S. Gaytan, Director, Veterans Affairs and 
             Rehabilitation Commission, The American Legion

    Mr. Chairman and Members of the Committee:
    Thank you for this opportunity to submit The American Legion's 
views on the bills being considered by the Committee today. The 
American Legion commends the Committee for holding a hearing to discuss 
these important and timely issues.

S. 2562, THE ``VETERANS' COMPENSATION COST-OF-LIVING ADJUSTMENT ACT OF 
                                 2006''

    S. 2562 will increase, effective as of December 1, 2006, the rates 
of compensation for veterans with service-connected disabilities and 
the rates of dependency and indemnity compensation for the survivors of 
certain disabled veterans. The amount of increase shall be the same 
percentage as the percentage by which benefit amounts payable under 
title II of the Social Security Act (42 U.S.C. 401 et seq.) are 
increased effective December 1, 2006.
    The American Legion supports this annual cost-of-living adjustment 
in compensation benefits, including dependency and indemnity 
compensation (DIC) recipients. It is imperative that Congress annually 
considers the economic needs of disabled veterans and their survivors 
and provide an appropriate cost-of-living adjustment to their benefits, 
especially should the adjustment need to be higher than that provided 
to other Federal beneficiaries, such as Social Security.

    S. 2694, THE ``VETERANS' CHOICE OF REPRESENTATION ACT OF 2006''

    The ``Veterans' Choice of Representation Act of 2006'' seeks to 
amend title 38, United States Code, to remove certain limitations on 
attorney representation of claimants for veterans benefits in 
administrative proceedings before the Department of Veterans Affairs 
(VA), and for other purposes. S. 2694 outlines the oversight of 
attorney representation to include registration fees collected by VA 
from attorneys who wish to represent veterans.
    The American Legion does not oppose the concept of attorney 
representation in the VA system or the lifting of current restrictions 
on attorney representation. We are concerned that such legislation 
should contain adequate safeguards to ensure each attorney's 
competency, training and reasonable fee limits. We are pleased that 
this bill includes provisions addressing these areas of concern. We 
recommend a fee cap or reasonable hourly rate be included to help 
ensure a speedy resolution of the claim. As it currently stands with a 
20 percent fee agreement, the longer it takes to satisfactorily resolve 
a claim, the larger an attorney's fee. A fee cap or reasonable hourly 
rate would help to avoid this problem and create an incentive for a 
timely resolution of the claim.
    Although we do not disagree with the reasoning of this bill, namely 
that a veteran should have the right to hire counsel to represent him 
or her in the VA claims administrative process, we do not concede that 
attorneys would necessarily do a better job representing claimants 
before the VA compared to experienced veterans' service organization 
(VSO) representatives who currently provide this service free of 
charge. Just because a veteran's advocate is an attorney does not mean 
that he or she is proficient in this very specialized area of 
administrative law and would be a more effective representative. In 
fact, the data at the administrative level does not indicate that 
attorneys are better or more effective representatives than VSO service 
officers. A review of the Board of Veterans' Appeals (BVA) disposition 
of appeals for Fiscal Year (FY) 2005 demonstrates that VSOs do as well, 
if not better, than attorneys in achieving a favorable resolution of an 
appeal.
    Additionally, The American Legion disagrees with the notion that 
lifting current restrictions so attorneys can enter the administrative 
process, before a final VA administrative decision, will fix all the 
problems that currently exist in the VA claims process. We are 
concerned that attorneys may make these problems worse by clogging the 
system with frivolous motions and other paperwork requests, and may 
affect the current non-adversarial nature of the VA administrative 
process. Moreover, some claimants who begin the process with an 
attorney may, at some point during the claims process, for whatever 
reason, sever the attorney-client relationship and then seek the 
services of a VSO representative. This situation may put both the 
claimant and the VSO representative at a disadvantage.
    In conclusion, although we do not oppose this bill and appreciate 
the various safeguards that are included, The American Legion does not 
believe this legislation is a solution to resolving the major problems 
that exist in the VA adjudicative process. We urge the Committee to 
address the major problems, as discussed in detail below, that 
currently exist, including, but not limited to, lack of accountability 
in the adjudicative process, training, inadequate staffing levels, and 
lack of quality and consistency in rating decisions by the rating 
officials and veteran law judges.

                                STAFFING

    Whether complex or simple, VA regional offices are expected to 
consistently develop and adjudicate veterans' and survivors' claims in 
a fair, legally proper, and timely manner. The adequacy of regional 
office staffing has as much to do with the actual number of personnel 
as it does with the level of training and competency of the 
adjudication staff. The Veterans Benefits Administration (VBA) has lost 
much of its institutional knowledge base over the past 4 years, due to 
the retirement of many of its 30-plus year employees. As a result, 
staffing at most regional offices is now made up largely of trainees 
with less than 5 years of experience. Over this same period, as 
regional office workload demands escalated, these trainees have been 
put into production units as soon as they completed their initial 
training.
    Concern over adequate staffing in VBA to handle its demanding 
workload was addressed by VA's Office of the Inspector General (IG) in 
a report released in May of 2005 (Report No. 05-00765-137, dated May 
19, 2005). The IG specifically recommended, ``in view of growing 
demand, the need for quality and timely decisions, and the ongoing 
training requirements, reevaluate human resources and ensure that the 
VBA field organization is adequately staffed and equipped to meet 
mission requirements.'' Additionally, the chairman of the Veterans' 
Disability Benefits Commission questioned the Under Secretary for 
Benefits about the adequacy of current staffing levels during a 
Commission meeting this past July. The Under Secretary conceded that 
the number of personnel has decreased over the last 3 years. It is an 
extreme disservice to veterans, not to mention unrealistic, to expect 
VA to continue to process an ever increasing claims workload, while 
maintaining quality and timeliness with less staff.
    Our current wartime situation provides an excellent opportunity for 
VA to actively seek out returning veterans from Operations Enduring 
Freedom and Iraqi Freedom, especially those with service-connected 
disabilities, for employment opportunities within VBA. We also 
encourage the hiring of more veterans and Reserve component personnel 
as they are already well versed in the rigors of military service, its 
health system and its medical and personnel recordkeeping systems, thus 
their `corporate knowledge' acquired in service to their country will 
enhance their work and they can provide valuable insights to their non-
veteran coworkers that will help the VA in its overall mission of 
adjudication of veterans' claims.

                                TRAINING

    Over the past few years, The American Legion's Quality Review Team 
has visited almost 40 VA regional offices for the purpose of assessing 
their overall operations. This assessment includes a review of recently 
adjudicated claims. Our site visits have found that frequently there 
have been an insufficient number of supervisors or too many 
inexperienced supervisors to provide trainees the necessary mentoring, 
training, and quality assurance. In addition, at many stations, ongoing 
training for the new hires as well as more experienced staff was 
postponed or suspended in order to focus maximum effort on production. 
However, we are encouraged by the Under Secretary for Benefits' public 
commitment to improving the training of VBA personnel and we 
optimistically anticipate improvements in this area in 2006.

                       PRODUCTION VERSUS QUALITY

    An informed observer of the VA adjudication system would find that 
the VA suffers from a quality problem. Although VBA's policy of 
``production first'' has resulted in many veterans getting faster 
action on their claims, the downside has been that tens of thousands of 
cases have been arbitrarily denied due, in part, to the lack of proper 
development of the claim at the regional office. Approximately 65 
percent of VA raters and Decision Review Officers (DROs) surveyed by 
the IG, in conjunction with its May 2005 report, admitted that they did 
not have enough time to render timely quality decisions. In fact, 57 
percent indicated that they would have difficulty meeting production 
standards if they took time to adequately develop claims and thoroughly 
review the evidence before making a decision. Inadequate regional 
office staffing levels and pressure to render quick decisions resulted 
in an overall decrease in quality of work, and has also been a 
consistent complaint among Service Center employees interviewed by The 
American Legion during our quality checks. As a consequence, the 
appeals burden at the regional offices, the BVA and the Appeals 
Management Center (AMC) continues to grow.
    In fiscal year 2005, the BVA issued more than 34,000 decisions. The 
BVA overturned the regional offices' decisions or remanded the decision 
for additional development in almost 60 percent of these appeals. 
Clearly, if the VA ensured proper regional office decision-making the 
inventory of appealed claims at the Board level would drop 
precipitously. For years, The American Legion and other VSOs have 
maintained that the driving force behind most VA adjudications is the 
need by the VA to process as many claims as possible in the fastest 
time possible. Awards and bonuses are often centered on production. 
Even the IG acknowledged that because the VA often does not take the 
time to obtain all relevant evidence and information, there is a good 
chance that these claims are not properly adjudicated. This improper 
emphasis on quantity and speed of adjudication results in premature 
adjudications, improper denials of benefits, and of course, 
inconsistent decisions.
    Another result of premature claim adjudications is incorrect 
decisions by the regional offices, which cause the consequent increase 
in remand orders by BVA veteran law judges. In essence, these remand 
orders are merely directing the regional offices to properly redevelop 
a veteran's claim, actions the regional office should have taken the 
first time the claim was filed. The growing claims backlog (according 
to the VA, there were 370,799 rating claims pending as of May 20, 2006) 
and the immense pressure on VA leadership to reduce it and provide 
timely decisions is often at odds with efforts to maintain or improve 
the quality of the decisions.
    The establishment of realistic production goals and timelines that 
take into consideration the number of pending cases and the complexity 
of the work must be accomplished if VA is to ever reach a much needed 
balance between production and quality in its adjudication process. In 
addition to providing rating personnel with sufficient time to properly 
develop and rate claims, it is essential for VA management to actively 
encourage and reward quality work and hold individuals, at every level, 
accountable for inferior work.

     S. 2659, THE ``NATIVE AMERICAN VETERANS CEMETERY ACT OF 2006''

    The ``Native American Veterans Cemetery Act of 2006'' will enable 
the Secretary to make grants under this subsection to any tribal 
organization to assist the tribal organization in establishing, 
expanding, or improving veterans' cemeteries on trust land owned by, or 
held in trust for, the tribal organization. Grants under this 
subsection shall be made in the same manner, and under the same 
conditions, as grants to States are made under the preceding provisions 
of this section.
    The American Legion supports the establishment of additional 
national and state veterans' cemeteries wherever a need for them is 
apparent. The American Legion supported P.L. 108-109, the National 
Cemetery Expansion Act of 2003 authorizing VA to establish new national 
cemeteries. Thus, The American Legion supports the Native American 
Veterans' Cemetery Act of 2006 because of the apparent need encompassed 
in this legislation.
    Every passing generation of veterans has earned the thanks of a 
grateful nation. Burial in a veterans' cemetery is the final salute to 
this Nation's heroes. The American Legion will continue to work with 
Congress to ensure that it provides the appropriate honor and 
recognition to ``him who shall have borne the battle and for his widow 
and his orphan.'' With young American servicemembers answering the 
Nation's call to arms in every corner of the globe, we must now, more 
than ever, work together to honor the sacrifices of America's veterans, 
past, present and future.

     S. 2416, THE ``VETERANS EMPLOYMENT AND TRAINING ACT OF 2006''

    S. 2416 seeks to expand the scope of programs of education for 
which accelerated payments of educational assistance under the 
Montgomery GI Bill (MGIB) may be used, and for other purposes.
    A higher percentage of today's servicemembers are married (with 
children in the majority of cases) when they are discharged. Meeting 
their financial obligations to sustain and maintain a family household 
is paramount and financial obligations often serve as major obstacles 
to the timely use of the MGIB. Every effort must be made to empower 
veterans with options to make the best vocational choice.
    The American Legion supports the provisions of the ``Veterans 
Employment and Training Act of 2006''. The current unemployment rate 
for veterans ages 18 to 24 is 15 percent, compared to the private 
sector rate of 8 percent. Increasing the educational benefit available 
through the MGIB would provide a better incentive for veterans to 
complete an educational program with immediate employment results 
without the need of acquiring student debt. In addition, The American 
Legion strongly supports the expansion of the program to include other 
short-term educational programs of value that could lead to the 
employment of veterans.

         S. 2121, THE ``VETERANS HOUSING FAIRNESS ACT OF 2005''

    S. 2121 seeks to expand the VA Home Loan benefit to include the 
purchase of stock or membership in a development, project, or structure 
of a cooperative housing corporation. The loan may not be guaranteed 
under subsection (a)(12) unless the development, project, or structure 
of the cooperative housing corporation complies with such criteria as 
the Secretary prescribes in regulations and the dwelling unit that the 
purchase of stock or membership in the development, project, or 
structure of the cooperative housing corporation entitles the purchaser 
to occupy is a single family residential unit.
    The American Legion has a number of concerns relating to this 
legislation and its potentially harmful effects on veterans. These 
concerns are listed below:
     A veteran who buys into a co-op is also paying into a 
shared loan, this arrangement potentially places the veteran in a 
situation that depends on the financial stability of others.
     Any significant down turn in the economy, or other 
financially related events, could have a significant impact on the 
ability of other cooperative members to meet their fiscal obligations 
to the co-op, which could result in the foreclosure of the blanket 
mortgage on that dwelling thus forcing the veteran to lose his or her 
home through no fault of his or her own.
     Unlike other homeowners, veterans residing in co-ops do 
not obtain a title to their home. Therefore, that veteran does not 
truly own his or her own home. In addition, veterans may forfeit the 
normal homeowner's right to sell their co-op, when and to whoever they 
chooses because co-ops have their own governing rules regarding the 
resale of a dwelling unit and these rules may conflict with current VA 
and Federal laws and regulations.
     In addition to the fact that a sale must be approved by 
the co-op, the sale of a dwelling unit may include the charging of 
additional fees, which, can be placed on the veteran at any time. These 
unregulated additional fees are contrary to the purpose of providing 
affordable housing to veterans.
    The American Legion does not have an official position on this 
particular bill at this time.
  a draft bill, to amend title 38, united states code, to provide for 
     accelerated payment of survivors' and dependents' educational 
  assistance for certain programs of education, and for other purposes
    The Draft Bill extends to Chapter 35 beneficiaries the same 
accelerated payment feature for high-tech courses that Chapter 30 
beneficiaries have, and it adds additional accelerated payment course 
options similar to those found in S. 2416, which seeks to expand the 
scope of programs of education for which accelerated payments of 
educational assistance may be used.
    The American Legion supports this bill. As the educational and 
labor demands in our society change, the educational benefits VA 
provides under Chapter 35, Dependents' Educational Assistance, need to 
adapt accordingly. This bill will take today's diversity in educational 
programs and vocations into account and provides more educational 
opportunities for Ch. 35 participants.

                               CONCLUSION

    Thank you again, Mr. Chairman, for allowing The American Legion to 
provide written comments on these measures. As always, The American 
Legion welcomes the opportunity to work closely with you and your 
colleagues on enactment of legislation in the best interest of 
America's veterans and their families.
                               __________

 Prepared Statement of David G. Greineder, Deputy National Legislative 
                            Director, AMVETS

    Chairman Craig, Ranking Member Akaka, and distinguished Members of 
the Committee:
    On behalf of National Commander Edward W. Kemp and the nationwide 
membership of AMVETS (American Veterans), I am pleased to offer our 
views on the pending veterans legislation before you today.
    AMVETS is a staunch advocate of providing veterans with the 
benefits and services they earned through honorable military service. 
As a leader since 1944 in helping to preserve the freedoms secured by 
America's Armed Forces, our organization continues its proud tradition 
providing not only support for veterans and the active military in 
procuring their earned entitlements, but also an array of community 
services that enhance the quality of life for this Nation's citizens.
    AMVETS applauds this Committee and its efforts to identify, examine 
and pursue the legislative initiatives necessary for veterans to obtain 
the services and benefits they so richly deserve.

 S. 2562, THE VETERANS' COMPENSATION COST-OF-LIVING ADJUSTMENT ACT OF 
                                  2006

    S. 2562 would provide a cost-of-living adjustment (COLA) to 
veterans' benefits effective December 1, 2006. The House and Senate 
annually review service-connected disability benefits and DIC programs 
to ensure they provide reasonable and adequate compensation for 
disabled veterans and their families. Based on this review, Congress 
acts to provide a COLA in compensation and DIC benefits.
    AMVETS supports S. 2562, but we would strongly recommend rounding 
benefits to the next higher dollar amount, not the next lower dollar 
amount, as outlined in Section 2(c)(2). We believe rounding to the next 
higher dollar amount would be fair and appropriate for disabled 
veterans.
    AMVETS also encourages this Committee to seriously look at 
legislation recently introduced by Sen. John Thune of South Dakota and 
Rep. Joe Knollenberg of Michigan. Their bills, S. 3068 and H.R. 5444 
respectively, would automatically increase veterans' disability 
benefits each year by the Consumer Price Index (CPI), without an act of 
Congress. It is important VA benefits keep pace with society and the 
high cost of living. H.R. 5444 would see that veterans' benefits are 
increased proportionately and will sustain the same buying power as in 
previous years. AMVETS believes this is a more efficient and timely way 
of providing a COLA to our Nation's disabled veterans and their 
families.

      S. 2694, THE VETERANS' CHOICE OF REPRESENTATION ACT OF 2006

    With all due respect, Mr. Chairman, AMVETS has many concerns with 
this legislation. S. 2694 would allow veterans to hire an attorney at 
any stage of the VA administrative process. First, veterans service 
organization provide, free of charge, excellent representation and a 
broad range of services to any veteran--member or not--within the 
community. A private attorney can and will charge high fees, which 
would be withheld from any benefit awarded to the veteran.
    Furthermore, the VA benefits system is a labyrinth of laws and 
regulations that takes years of experience and training to understand 
and navigate. I realize there are training programs and fee caps 
outlined in the bill, but frankly, how is VA going to administer these 
programs and caps, and how will they work? VBA is financially strapped 
as it is, and claims backlogs continue to grow. We need to work on 
reducing pending cases and hiring more effective and knowledgeable 
claims processors, not lawyers.
    Mr. Chairman, there are currently over 118,000 claims pending for 
more than 180 days. Please don't add to the growing backlog by allowing 
lawyers into the VA system. AMVETS knows you are a friend to veterans 
and are trying to think of ways to improve the benefits system. But the 
issue is not necessary whether veterans have the right to hire a 
lawyer, they do at certain stages of the process. We are concerned that 
lawyers would only increase the burden to the system and contribute to 
the growing backlog. AMVETS does NOT support this legislation and we 
recommend you reconsider your position.

       S. 2659, THE NATIVE AMERICAN VETERANS CEMETERY ACT OF 2006

    S. 2659, introduced by Ranking Member Akaka, would authorize the 
Secretary of Veterans Affairs to make grants to any tribal organization 
for establishing, expanding, or improving veterans' cemeteries on trust 
lands. Essentially, it would allow tribes to apply for state cemetery 
grants from VA. Under current Federal law, only States are able to 
apply for the grants.
    As the veterans service organization responsible for the cemeteries 
portion of The Independent Budget, AMVETS works very closely with the 
National Cemetery Administration (NCA) and fully supports the State 
Cemeteries Grant Program. The program assists States in providing 
gravesites for veterans in areas where VA's national cemeteries cannot 
fully satisfy their burial needs. In the western United States, where 
many Native Americans live today, the large land areas and spread out 
population makes it difficult to meet the ``170,000 veterans within 75 
miles'' national veterans cemetery requirement.
    AMVETS believes cemeteries on tribal lands would be an appropriate 
memorial and reminder of the sacrifices made by Native American men and 
women. AMVETS supports the bill.

       S. 2416, THE VETERANS EMPLOYMENT AND TRAINING ACT OF 2006

    S. 2416, introduced by Sen. Burns, would greatly enhance Montgomery 
GI Bill education benefits for eligible veterans wanting to use tuition 
assistance in a high-growth industry. Specifically, the bill would 
expand the range of programs for which accelerated payments of 
educational assistance can be used.
    Overall, the legislation would make short-term, high-cost training 
programs more affordable to veterans. Currently, GI Bill benefits are 
paid as a monthly stipend to the maximum amount of $1,000. However, 
many training programs run anywhere from 4 to 6 weeks, and can cost 
upwards of $6,000. At most, the GI Bill benefits only offset about 
$1,500 of the veterans' tuition, but accelerated benefits could cover 
upwards of 60 percent of the cost.
    Most importantly, this legislation would help address the serious 
unemployment rate of veterans between the ages of 20 and 24. Veterans 
in this age bracket have an unemployment rate of over 15 percent--
nearly double the rate of non-veterans in the same age group. 
Accelerating GI Bill benefits for training in high-tech occupations 
would help place veterans in a good paying, long-term, and secure job. 
AMVETS endorses the bill.

   S. 3363, A BILL TO PROVIDE ACCELERATED PAYMENTS OF SURVIVORS' AND 
                   DEPENDENTS' EDUCATIONAL ASSISTANCE

    S. 3363, introduced by Sen. DeWine, would extend accelerated 
education payments for high-tech industries outlined in Sen. Burns' 
bill, S. 2416, to survivors and dependents. AMVETS supports the 
legislation.
           s. 2121, the veterans housing fairness act of 2005
    S. 2121, introduced by Sen. Schumer, would allow VA housing loan 
benefits to be used for the purchase of residential cooperative 
apartment units. Under current law, VA loans can be used to purchase a 
house, townhouse, condominium or even a mobile home, but not a co-op. 
Co-ops make up the vast percentage of affordable housing in large 
cities and are usually less expensive than a condo or other unit. This 
legislation would give veterans greater housing choice by allowing them 
to use their hard-earned benefits to buy a co-op if they prefer. AMVETS 
supports the bill.
    Mr. Chairman, before I close, I would like to take a moment and 
thank you for your swift action on H.R. 5037, the Respect for America's 
Fallen Heroes Act. AMVETS appreciates you working together with Mr. 
Akaka, the Leadership and your colleagues in the Senate to get this 
very important bill passed. It is the right thing to do for the 
families who have lost loved ones, and will it honor the ultimate 
sacrifice of our fallen comrades. Thank you for your leadership.
    In closing Mr. Chairman, AMVETS looks forward to working with you 
and others in the Senate to ensure the earned benefits of all of 
America's veterans are strengthened and improved. As we find ourselves 
in times that threaten our very freedom, our Nation must never forget 
those who ensure our freedom endures.
    This concludes my testimony. Thank you again for the opportunity to 
present our views, and I would be happy to answer any question you 
might have.
                                 ______
                                 
                                                      June 8, 2006.
Hon. Larry Craig,
Chairman, Veterans' Affairs Committee,
Russell Senate Office Building,
Washington, DC.
    Dear Chairman Craig: Neither AMVETS nor I have received any Federal 
grants or contracts, during this year or in the last 2 years, from any 
agency or program relevant to the May 25, 2006, Committee hearing on 
the legislation before the panel.

            Sincerely,
                                        David G. Greineder,
                              Deputy National Legislative Director.
                               __________
 Prepared Statement of Douglas M. Kleine, Executive Director, National 
                  Association of Housing Cooperatives

    On behalf of the National Association of Housing Cooperatives, I 
thank the Chairman and Members of the Committee for the opportunity to 
testify about the need to include cooperative housing in the VA Home 
Loan Guaranty Program, as proposed in S. 2121. I am Douglas M. Kleine, 
Executive Director of the National Association of Housing Cooperatives, 
or NAHC. NAHC represents housing cooperatives and housing cooperative 
professionals.
                                  nahc
    The National Association of Housing Cooperatives (NAHC) was founded 
in 1960 to provide information on the successful creation and operation 
of housing cooperatives. NAHC helps low and moderate income families 
govern, manage, and preserve affordable homeownership communities for 
themselves and future residents. Over 1.2 million families now live in 
townhouse and apartment housing co-ops in 30 states, the District of 
Columbia, and Puerto Rico. About half of all housing co-ops are in the 
greater New York City area, but other concentrations can be found in 
Boston, Atlanta, Miami, Philadelphia, Pittsburgh, Detroit, Chicago, 
Indianapolis, Minneapolis-St. Paul, San Francisco, Seattle, and Los 
Angeles. Here in DC, where Washington's Mayor Williams lives in a co-
op, there are over 200 co-ops, and just outside the city, the planned 
community of Greenbelt, Maryland, has been a co-op for over 50 years.

What is Cooperative Homeownership?
    While everyone is familiar with homeownership through fee simple 
ownership of a single-family home or a condominium unit, the option of 
owning one's home through a cooperative is much less understood, even 
though co-ops date back to the 1920s in the US. In a cooperative, 
residents own shares of the cooperative corporation; the corporation 
holds title to the entire multi-family property. Ownership of a share 
in the cooperative entitles the resident to sole occupancy of a 
specific unit. Instead of rent, the resident-owners of the cooperative 
pay monthly carrying charges to cover the cooperative's debt, 
maintenance, and other expenses. As in condominiums, the resident-
owners elect a board of directors from among themselves to make 
policies for the cooperative. The board of directors usually hires a 
manager or management agent to run day-to-day operations.

Congress Should Continue to Treat Co-Op Share Loans Like Single Family 
        Mortgages
    Purchasers of cooperative shares obtain financing from lenders on 
much the same terms as a mortgage. The loan is secured by the shares, 
and has been classified as a residential mortgage by the Federal Home 
Loan Bank Board for over 25 years. Fannie Mae has provided a secondary 
mortgage market for share loans for over 25 years, the Federal Housing 
Administration (FHA) has had authority for over 25 years to ensure 
share loans through the Section 203(n) program, and for over 60 years, 
Congress has recognized the similarity of cooperative homeownership to 
single family and condominium ownership by giving co-op shareholders 
the right to take a personal income tax deduction for interest on a 
share loan and a pro rata portion of the mortgage interest and real 
estate taxes paid by the cooperative corporation. In 2000, Congress 
made co-op homeowners eligible for FHA-insured Home Equity Conversion 
Mortgages, and in 2004, Congress included co-ops in the American Dream 
Downpayment Assistance Act.

Veterans Should Have the Ability to use the VA Loan Guaranty Program to 
        Buy 
        Into a Co-Op
    Given all the other agencies and organizations participating in 
share loan financing, it clearly is time that the Department of 
Veterans Affairs be given the statutory authority to guaranty share 
loans as provided in S. 2121. Doing so is good for the veteran by 
providing the veteran with a wider choice in housing and a wider choice 
in home financing. Indeed, in many housing markets co-ops are often the 
most affordable homeownership option for veterans. And this benefit 
would come with little or no risk to the government. We can say that 
because underwriting guidelines have existed for over 25 years, and 
Fannie Mae reports that their co-op share loan portfolio performs 
better than their single family portfolio. We are confident that VA's 
Loan Guaranty Service, using this marketplace underwriting history as 
well as VA's long experience in multifamily settings through its 
condominium program, can establish reasonable risk mitigation 
procedures to protect the veteran and the agency.
    Thank you again, Mr. Chairman and Members of this Committee, for 
this opportunity to state why our veterans should have greater choice 
and be able to use VA home loan guaranty benefits to buy into a housing 
cooperative.
                                 ______
                                 
  Press Release from the National Association of Housing Cooperatives

    Washington, DC.--``Veterans cannot now use their GI benefits to buy 
into a housing co-op,'' said Douglas M. Kleine, executive director of 
the National Association of Housing Cooperatives in testimony submitted 
to the U.S. Senate Committee on Veterans Affairs hearing on S. 2121, 
The Veterans Housing Fairness Act of 2006. S. 2121 would give authority 
to the Department of Veterans Affairs to guaranty home loans for 
veterans who choose to buy into a housing co-op.
    ``In many housing markets, co-ops are often the most affordable 
homeownership option for veterans,'' Kleine says. ``And adding co-ops 
to the VA loan guaranty program would come with little or no risk to 
the government.'' NAHC noted that co-op loan underwriting guidelines of 
Fannie Mae have existed for over 25 years. ``We are confident that VA's 
Loan Guaranty Service, using this marketplace underwriting history as 
well as VA's long experience in multifamily settings through its 
condominium program, can establish reasonable risk mitigation 
procedures to protect the veteran and the agency,'' concluded Kleine.

                                  NAHC

    The National Association of Housing Cooperatives (NAHC), founded in 
1960, provides information on the successful creation and operation of 
housing co-ops. NAHC helps low- and moderate-income families govern, 
manage, and preserve affordable homeownership communities for 
themselves and future residents. Over 1.2 million families now live in 
townhouse and apartment housing co-ops in 30 states, the District of 
Columbia, and Puerto Rico. About half of all housing co-ops are in the 
greater New York City area, but other concentrations can be found in 
Boston, Atlanta, Miami, Philadelphia, Pittsburgh, Detroit, Chicago, 
Indianapolis, Minneapolis-St. Paul, San Francisco, Seattle, and Los 
Angeles. In Washington, D.C., where Washington's Mayor Williams lives 
in a co-op, there are over 200 co-ops, and just outside the city, the 
planned community of Greenbelt, Maryland, has been a co-op for over 50 
years.
                               __________
               Prepared Statement of Rose Elizabeth Lee, 

     Gold Star Wives of America, Inc., Chair, Legislation Committee
    ``With malice toward none; with charity for all; with firmness in 
the right, as God gives us to see right, let us strive to finish the 
work we are in; to bind up the nation's wounds, to care for him who has 
borne the battle, his widow and his orphan.''
                                         President Abraham Lincoln,
                           Second Inaugural Address, March 4, 1865.

    Mr. Chairman, Senator Akaka, and Members of the Senate Veterans' 
Affairs Committee, I would like to thank you for the opportunity to 
submit testimony to you on behalf of all Gold Star Wives regarding a 
bill to provide for accelerated payment of survivors' and dependents' 
educational assistance.
    My name is Rose Lee. I am a widow and the Chair of the Gold Star 
Wives (GSW) Committee on Legislation. I am also currently President of 
the Potomac Area Chapter. In the past, I have held the positions of 
President and Chair, Board of Directors for GSW. For nearly thirty 
years now I have been working to achieve the overall goals of the Gold 
Star Wives, and more specifically to assist our young, new widows, one 
by one, wind their way through the maze that lies before them with 
first notification of the death of their loved one.
    The Gold Star Wives of America, Inc. was founded in 1945 and is a 
Congressionally chartered service organization comprised of surviving 
spouses of military servicemembers who died while on active duty or as 
a result of a service-connected disability. We could begin with no 
better advocate than Mrs. Eleanor Roosevelt, newly widowed, who helped 
make GSW a truly national organization. Mrs. Roosevelt was an original 
signer of our Certificate of Incorporation as a member of the Board of 
Directors. Many of our current membership of over 10,000 are the widows 
of servicemembers who were killed in combat during World War II, the 
Korean War, the Vietnam War and the more recent wars including the one 
we are currently in, the Global War On Terrorism (GWOT).
    In this testimony I will respond to your request for our 
legislative views on S. 3363, a bill to provide for accelerated payment 
of survivors' and dependents' educational assistance. It is important 
that our widows and their children have the assistance they need to 
continue or begin an education to help assure employability as they 
transition into their new lives with a need for a different means of 
family support than had been previously planned. It is imperative that 
the difficulty of the sacrifice of our husbands' lives be mitigated to 
the degree possible by providing support for opportunities through 
education to achieve financial security for the survivors.
    Thank you for this opportunity and for your continued support of 
programs that directly support the well-being of our servicemembers' 
widows and their families.
    Gold Star Wives applaud the efforts of this bill to assure timely 
payment of educational benefits. This is surely a key to easing a 
survivors' difficult task of moving into their new lives. There are 
several principles that we feel are necessary to assure that this 
legislation can truly accomplish the purposes for which it was written.
    1. We need to assure that there is thorough and wide-spread 
communication about this benefit when it is passed into law. It is one 
thing to do the right thing in providing the legislative authority 
necessary to help with transitioning lives; it is quite another to 
assure that those who could use the benefit recognize that it is 
available and know how to access it. Communication is key, and we 
recommend that it be part of this legislation.
    2. Other legislation aimed at assisting survivors over the last 
several years has sometimes divided survivors along an arbitrarily 
designated date that excludes those who became widows early in this 
current conflict from the benefit. GSW recommends that it be clearly 
stated in this legislation that it applies to all widows or survivors 
of the Global War on Terror.
    3. Education benefits for surviving spouses who are on active duty 
should be able to use the education benefit derived from her deceased 
husband while still serving on active duty. Currently, the active duty 
widow must resign from the military in order to use the derived 
educational benefit. GSW recommends that this legislation assure this 
inequity is fixed.
    In conclusion, we do not want our widows to be forgotten. Whenever 
the ultimate sacrifice is given, there is family left behind. In the 
same way we have asked some to give their lives, we have also asked 
some to continue their lives with a chasm so large it is difficult to 
transgress. Let us show the spirit of this nation by not forgetting 
these widows, whose numbers grow daily.
    I thank this Committee for using this hearing as one more avenue of 
awareness of issues facing survivors daily. We will be happy to work 
with the Committee on this initiative. Thank you.
                               __________
                 Prepared Statement of James C. McKay, 
          Senior Counsel, Covington & Burling, Washington, DC

    Mr. Chairman and Members of the Subcommittee:
    This statement, in support of S. 2694, responds to some of the 
issues raised in the opposition filed on behalf of the Disabled 
American Veterans by Joseph A. Violante. I will not respond to the ad 
hominem attacks on the ethics of lawyers, except to state that the type 
of unethical conduct predicted by the DAV and a plurality of four 
justices of the Supreme Court in Walters v. National Association of 
Radiation Survivors, 473 U.S. 395 (1985), heavily relied upon by the 
DAV would be unlikely to occur in view of the rules currently governing 
the conduct of lawyers throughout the United States.
    I served on active duty in the United States Naval Reserves from 
December 15, 1941, to October 1945. I received an LLB from Georgetown 
University School of Law in February 1947. Since that date, I have 
continuously practiced law with the Washington, D.C., firm of Covington 
& Burling, with the exception of a period of service as an Assistant 
United States Attorney for the District of Columbia, and a period of 
service as an Independent Counsel.
    I have represented numerous veterans on a pro bono basis for more 
than 10 years before the court now known as the United States Court of 
Appeals of Veterans Claims (CAVC). That representation involved 
becoming familiar with numerous CAVC opinions and opinions of the 
United States Court of Appeals for the Federal Circuit. In connection 
with that representation I became aware of the anachronistic and often 
prejudicial law that bars veterans from hiring lawyers to represent 
them during the crucial early phases of the Department of Veterans 
Affairs administrative process. That knowledge led me to research the 
origin of this uniquely restrictive law. I wondered why this particular 
class of United States citizens, owed such a large debt of gratitude by 
their Government, should be denied the basic important right to hire 
legal counsel.
    I could think of no reason why any individual or any group of 
individuals would support such an obviously discriminatory rule of law. 
It came as a surprise when I learned that the law has vigorous support, 
not only of organizations of veterans, but also of the Department of 
Veterans Affairs. For example, a 2003 House Bill (H.R. 3492), which 
would have allowed the employment of lawyers by veterans throughout the 
entire VA administrative process, was opposed by the VA and by service 
organizations.
    The DAV asserts in the third paragraph of his statement that 
``veterans should be able to file claims for disability benefits and 
receive fair decisions from the Department of Veterans Affairs (VA) 
without the necessity to hire and pay a large portion of their benefits 
to lawyers.'' There if no foundation for the premise of that statement. 
Under the provisions of S. 2694, there would be no ``necessity'' that 
veterans hire lawyers. Rather, each veteran would have the choice of 
hiring a lawyer or not hiring a lawyer. Likewise, there is no basis for 
the demeaning conclusion that veterans would choose to hire a lawyer to 
satisfy an ``emotional gratification of having the right to choose 
representation by a lawyers.''
    The third paragraph of the DAV's statement continues by stating 
that ``Congress designed the current administrative claims process to 
be non-adversarial and pro-veteran.'' The current administrative claims 
process is based on a law enacted in 1862, which limited to $5 the fee 
that legally could be charged a veteran. In 1864, the fee limit was 
raised to $10, where it remained for 124 years, when the current system 
was enacted, allowing no fee to be charged until after the first final 
decision of the Board of Veterans' Appeals. Criminal penalties were 
provided for the violation of all of those discriminatory laws.
    The main thrust of the DAV's argument relies completely on an 
outdated statement in S. Rep. No. 100-418, at 63-64 (1988), which, in 
turn, relied completely on the plurality opinion of four justices of 
the Supreme Court in Walters, issued twenty-one years ago. The DAV's 
statement quotes lengthy passages from that opinion, which included 
quotations from the Supreme Court's opinions in Gagnon v. Scarpelli, 
411 U.S. 778, 787-788 (1973), and Wolff v. McDonnell, 418 U.S. 539, 570 
(1974).
    The DAV statement does not mention that the plurality decision in 
Walters was based largely on the amazing conclusion that lawyers are 
not needed because service organizations representatives (who charge no 
fee) are fully capable of representing veterans for the reason that 
``complex'' cases constituted a ``tiny fraction'' of the total cases 
pending before the VA. (473 U.S. at 329-330). The plurality of justices 
proclaimed that the medical questions relating to the degree of 
disabilities of veteran claimants were overwhelmingly simple, and that 
complex medical issues seldom arose in VA administrative proceedings. 
(Ibid.)
    The plurality justices' view of the simplicity of veterans claims 
was at odds with the Supreme Court's view stated eleven years earlier 
in Johnson v. Robinson, 415 U.S. 361, 370 (1974), where the Court's 
decision relied on a statement of the Administrator of the Veterans 
Administration in support of the 1979 amendment to 38 U.S.C. sec. 361 
(1974), that, ``in the adjudication of compensation and pension claims, 
a wide variety of medical, legal, and other technical questions 
constantly arise which require expert examiners of considerable 
training and experience and which are not readily susceptible of 
judicial standardization.''
    Daniel L. Cooper, then Under Secretary for Benefits, Department of 
Veterans Affairs, in testimony before the House Veteran's Affairs 
Committee on November 3, 2005, stated that the ``number of disabilities 
per claim submitted by veterans has increased significantly, making 
claims more complex.'' He went on to describe the influx of ``new and 
more complex disability claims based on environmental and infectious 
risks, traumatic brain injuries, complex combat injuries, involving 
multiple body systems, concerns about vaccinations and other 
conditions.'' He referred to the aging of the veteran population, who 
were service connected for diabetes, as adding to the complexity of 
claimed disabilities. He noted that ``more than 220,000 veterans are 
now service connected for diabetes.'' Mr. Cooper went on to say that 
the number of veterans submitting claims for PTSD through fiscal year 
2005 had increased from 134,000 to 245,000. ``These cases present 
unique processing complexities because of evidentiary requirements to 
substantiate the event causing the stress disorder.''
    In Kirkendall v. Department of the Army, 412 F.3d 1273, 1277 (Fed. 
Cir. 2005), the Federal Circuit noted that the Veterans Employment 
Opportunities Act of 1998, 5 U.S.C. sec 333a, ``is less detailed than 
the highly complex scheme used to provide benefits for veterans.''
    The DAV's reliance on Gagnon and Wolff is equally misplaced. The 
Gagnon case was decided 33 years ago. The petitioner was not a veteran. 
He was a felony probationer who was arrested after committing a 
burglary. The case involved the due process rights of felony parolees 
in parole revocation proceedings. The Wolff case was decided 32 years 
ago. The petitioner was a Nebraska prisoner, who challenged the 
constitutionality of the Nebraska prison disciplinary proceedings. The 
Supreme Court said that the prisoners' rights were ``subject to 
restrictions imposed by the nature of the regime in which they have 
been lawfully committed.'' The Court said further that the proceedings 
``take place in a closed tightly controlled environment peopled by 
those who have chosen to violate the criminal law and who have been 
lawfully incarcerated for doing so.'' (418 U.S. at 561)
    It was misleading in the extreme for the DAV to quote selectively 
from those three Supreme Court opinions, and not tell the Committee the 
whole story. To liken the due process rights of a paroled felon and an 
incarcerated prisoner with those of a veteran, who has honorably served 
his or her country is completely unfounded, and insulting to say the 
least.
    It is urged that members of the legal staff of this Committee read 
these three Supreme Court decisions, if they have not done so. It will 
quickly be seen that those decisions provide no substantial support for 
the DAV's arguments against the enactment of S. 2639.
    The desirability of permitting veterans to employ lawyers during 
the early proceedings before the VA has been recognized by those in 
best position to perceive the prejudicial effect of the current 
system--the Judges presiding over the CAVC.
    They have seen at first hand the costly delays and prejudices that 
result when issues and arguments are not raised before the VA prior to 
appeals to the Court. Thus, Chief Judge Frank Nebeker, in a concurring 
opinion in Matter of Kenneth B. Mason Jr., 12 Vet. App. 135 (1999), 
stated that ``the Court experience. . . over the past 9 years'' 
convinced him that ``the time was ripe for a reexamination of the role 
of attorneys in the benefits adjudication process and whether this 
Court should have the responsibility to oversee the matter of fees 
charged by those attorneys.'' Judge Nebeker was troubled by ``the 
limited role lawyers are permitted (or may be paid) to play in the 
adjudication of veterans benefits.'' (Id. at 137) The opinion went on 
to say:
    ``When judicial review was established 10 years ago, there was 
apparent concern on the part of Congress that opening the door to 
lawyer representation, even in a limited way, was fraught with 
potential peril that at least some oversight of the attorney-client 
relationship was necessary.'' (Id. at 137)
    Judge Nebeker questioned the need ``effectively to restrict lawyer 
representation by proscribing the charging of fees prior to BVA 
decision and the oversight of fee agreements by the Court.'' He 
continued by saying:
    ``In the absence of any empirical or statistical data, one can only 
wonder whether Congress presumed that the bar would act 
unprofessionally or would replace the services offered gratis by 
veterans service groups. If the former, it is an unfounded indictment 
based on mistrust. If the latter, it is evidence of a desire to prevent 
the bar from trespassing upon protected turf. In either case, now that 
we have had nearly 10 years of experience, a questioning of the basic 
premise is in order.'' (Ibid.)
    Judge Nebeker then referred to the Court's years of experience in 
reviewing Board denials of benefits. He stated:
    ``The Court continues to see many appeals, if counsel were 
realistically permitted to represent a claimant during the adjudication 
process before a final BVA decision, an appeal would be unnecessary or 
seen as futile by the applicant; however, with the present restriction 
on lawyer representation, an error at the VA level may not be 
discovered until years later where, with counsel, it might well have 
been prevented at the outset. Thus, restricting realistic access to 
counsel until after a final BVA decision can cause years of delay both 
in adjudication before the VA and in discovering error through 
appellate litigation, only to have the matter returned to the VA for 
readjudication. This happens in many appeals.
    ``Effectively limiting lawyer representation until after a BVA 
final decision and after oversight of fee agreements is, quite 
arguably, unnecessarily paternalistic.'' (Ibid.)
    In a 2004 interview, then Chief Judge Donald L. Ivers, stated that 
lawyers ``have provided tremendous assistance'' in cases before the 
Court. ``The Court has historically taken a position recognizing the 
involvement of lawyers before the VA could be very helpful . . . , and 
I concur. Tommy: Issue No. 4. 2004.
    Retired Judge Ronald Holdaway, also a former General Counsel of the 
VA, speaking at the CAVC Eighth Judicial Conference, expressed his 
support for an amendment of 38 U.S.C. sec. 5094, allowing lawyers to 
represent veterans before the VA.
    After pointing out that ``all too frequently you get cases that 
have been through the system seven or eight or nine times where nobody 
is really focused on what the issue is or they've lost on an issue.'' 
Judge Holdaway said:
    ``If you get lawyers involved at the beginning, you can focus on 
what is this case about. I think you would get better records, you 
would narrow the issue, there would be screening . . . But the 
fundamental reason, why should veterans be treated differently from 
anyone else?''
    Speaking from an appellate judges point of view, Judge Holdaway 
stated further:
    ``It would be a lot easier for an appellate judge to review cases 
where counsel had been involved; where there had been better building 
of the record; where the issues had been narrowed; and where there had 
been a certain amount of screening going on when counsel explains to 
his client whether he's got a good case or not. I think all those would 
certainly be helpful to appellate judges.''
    Thank you for considering the foregoing views which are presented 
in the interest of the thousands of veterans who have filed claims for 
benefits for service-connected disabilities, and those who will file 
such claims in the future.
                               __________

        Prepared Statement of the Paralyzed Veterans of America

    Chairman Craig, Ranking Member Akaka, and Members of the Committee, 
Paralyzed Veterans of America (PVA) would like to thank you for the 
opportunity to submit a statement for the record on S. 2562, the 
``Veterans' Compensation Cost-of-Living Adjustment Act;'' S. 2694, the 
``Veterans' Choice of Representation Act;'' S. 2659, the ``Native 
American Veterans Cemetery Act;'' S. 2416, the ``Veterans Employment 
and Training Act;'' S. 2121, the ``Veterans Housing Fairness Act;'' and 
proposed legislation. We appreciate the efforts of the Committee to 
improve the benefits available for veterans.

 S. 2562, THE ``VETERANS' COMPENSATION COST-OF-LIVING ADJUSTMENT ACT''

    PVA supports S. 2562, the ``Veterans' Compensation Cost-of-Living 
Adjustment Act of 2006.'' This bill would increase the rates of 
compensation for veterans with service-connected disabilities and the 
rates of dependency and indemnity compensation for widows of certain 
disabled veterans. As we have done in the past, we oppose again this 
year the provision rounding down the cost-of-living adjustment to the 
nearest whole dollar. Continuing to round down these benefits year 
after year only serves to erode the value of them. Furthermore, this 
provision forces veterans to bear some of the burden of cost-savings 
for the Federal Government.

        S. 2694, THE ``VETERANS' CHOICE OF REPRESENTATION ACT''

    PVA supports the principle that veterans should have the choice to 
hire attorneys; however, we do not believe that S. 2694 offers the best 
approach to addressing this issue.
    The restrictions against veterans hiring lawyers to represent them 
date back to the Civil War. At that time the prohibition may have made 
sense and was to protect veterans from unscrupulous lawyers who were 
charging exorbitant fees to assist veterans in obtaining their 
pensions. This law initially imposed a fee of $5, and it was later 
raised to $10. This was considered a reasonable fee at the time and was 
not eliminated until 1988 when Congress created the U.S. Court of 
Veterans' Appeals, which later became the Court of Appeals for 
Veterans' Claims. The creation of the Court led to a prohibition on 
veterans hiring a lawyer until after the Board of Veterans' Appeals 
rendered a final decision.
    The reason for the statutory fee limitation, now a prohibition, 
does not exist currently and has not existed for a long time. Today, 
lawyers are highly regulated and subject to significant disciplinary 
action if determined to have engaged in unscrupulous or unethical 
conduct while engaged in the practice of law. We believe that VA's 
attempt to mollify the push to change the law to give veterans the 
choice to hire a lawyer falls short. A May 2004 letter from VA General 
Counsel to Representative Lane Evans, Ranking Minority Member of the 
House Committee on Veterans' Affairs, indicated that claimants can hire 
and pay a lawyer for pre-application for benefits counseling under 
current law. It is the VA General Counsel's position that as long as 
the consultation occurred prior to the filing of the application for VA 
benefits, and the lawyer did not prepare the application, there is no 
violation of statutes. A law that would permit the veteran to hire a 
lawyer for pre-application advice but denies him or her the ability to 
continue with this paid representation is harmful to veterans and makes 
no sense.
    Today there are a number of Veterans' Service Organization (VSO) 
service officers to assist veterans in accessing the full range of 
benefits and services available to them. Veterans' Service 
Organizations provide such services free-of-charge, and veterans are 
free to choose which VSO they would like to assist them. Service 
officers also help veterans access the many health care services 
available through the VA. Likewise, they help veterans gain access to 
assistive technology and other equipment to meet their accessibility 
needs. The service officer and the veteran develop a unique 
relationship through this interaction and will, we believe, continue to 
serve in this important role even if veterans are given the choice to 
hire a lawyer to represent them before the VA.
    PVA believes that the most appropriate time for veterans to hire 
and pay a lawyer to represent them is after a Notice of Disagreement is 
filed and their initial application for benefits has been denied. This 
is the time at which a lawyer's skills would be particularly helpful. 
Furthermore, PVA is unaware of any other government benefits program 
which prohibits claimants from hiring a lawyer to assist those 
obtaining benefits. This is the position taken by H.R. 4914, the 
``Veterans' Choice of Representation Act'' that has been introduced in 
the House of Representatives by Representative Evans.
    If this legislation or similar legislation is enacted, it is 
imperative that the VA conduct a campaign to inform veterans of their 
options. We believe that under the Evans' proposal, an information 
brochure outlining the veteran's options following a Notice of 
Disagreement could be included in the notification. This would allow 
veterans to make a decision for themselves as to the type of 
representation they would like through the rest of the claims 
adjudication process.
    While PVA appreciates the logic of the proposal outlined in S. 2694 
of a veteran having the choice to hire a lawyer from the beginning of 
the application process, PVA believes that this aspect of the Evans 
bill is a good compromise by perpetuating the valuable role played by 
VSOs and their service officers. It acknowledges and addresses some of 
the concerns this issue has generated among the VSOs. This may even 
encourage the VA to grant more meritorious claims upon initial 
application.
    But many issues remain to be addressed in any piece of final 
legislation. One of the greatest questions is what will be considered 
reasonable fees to the veteran? PVA believes that further guidance is 
needed for what would constitute a reasonable fee for other than 
contingency fee arrangements. We recommend that the Committee consider 
language similar to that contained in Title 42 that governs recognition 
of representatives before the Social Security Administration and the 
fees that those representatives may collect. Specifically, 42 U.S.C. 
406(a)(2) specifies that an attorney's or agent's fee will not be more 
than 25 percent of the total amount of past-due benefits or $4,000, 
whichever is less. Similar protections could be placed in the 
legislation for veterans hiring attorneys. Additionally, specific 
guidelines and regulations are critical before allowing this program to 
begin. This must also include the preservation of the pro-claimant 
aspects of the system.
    Furthermore, we must not forget that responsibility for the claims 
backlog rests with the Veterans Benefits Administration (VBA). This 
claims adjudication process is not a faultless process. Moreover, VBA 
suffers from too few staff and not enough resources to meet the demand 
that is placed on the system. If full consideration is given for this 
legislation, then adequate funding and staffing must also be included 
in that discussion. Otherwise, the system is really no better off.
    Whatever legislation is passed, we must ensure that the best 
interests of the veteran are protected in the end. With this in mind, 
it is critical that clear guidance on the basis for suspension of 
veteran's representatives be established, whether they are lawyers, 
agents or even a VSO National Service Officer. And it must be ensured 
that no provision of the law will conflict with a lawyer's ethical 
obligation to zealously represent his or her client's interests.
    Though the original law severely restricting and finally 
prohibiting payment to attorneys may have been valid in the past, PVA 
believes that giving veterans the ability to choose and pay a 
reasonable fee to a representative of their choosing after the initial 
Notice of Disagreement is the right thing to do at this time, so long 
as our above mentioned considerations are taken into account.

         S. 2659, THE ``NATIVE AMERICAN VETERANS CEMETERY ACT''

    PVA supports S. 2659 which would allow Indian tribal organizations 
to apply for Federal grants to establish veterans' cemeteries on trust 
lands. This legislation would essentially provide for the same 
eligibility to Indian tribal organizations for these grants that states 
currently have when they wish to construct a new cemetery.
         s. 2416, the ``veterans employment and training act''
    PVA fully supports S. 2416, the ``Veterans Employment and Training 
Act of 2006.'' With the increases in new veterans entering the VA 
system due to the current Global War on Terrorism, particularly the 
huge increase in National Guardsmen and reservists becoming veterans, 
every chance to expand the education opportunities for this widely 
diverse group is critical. The ability to enter high technology 
training that will lead to an occupation in this rapidly expanding 
field will help not only the veteran, but the economic viability of 
America. Increasing the ability to accelerate payments to receive this 
training will provide veterans with the opportunity to more rapidly 
enter the high technology field. It will also assist in our veterans' 
rapid transition from military service to community citizen and is a 
win for everyone. We also welcome the introduction of Senator DeWine's 
legislation to make these similar accelerated payments available to 
survivors and dependents of veterans.

             S. 2121, THE ``VETERANS HOUSING FAIRNESS ACT''

    PVA supports the provisions of S. 2121. This legislation would 
authorize a veteran to use veterans' housing loan benefits to purchase 
stock or membership in a development, project, or structure of a 
cooperative housing corporation. In order to do so, the structure that 
the veteran purchases must be in compliance with criteria set forth by 
the Secretary of Veterans Affairs, and it must be a single-family 
residential unit.
    PVA would like to thank you for the opportunity to submit our views 
on the important legislation pending before the Committee. We would be 
happy to answer any questions that you submit for us in writing.
                               __________

 Prepared Statement of Donald Sweeney, Legislative Director, National 
                Association of State Approving Agencies

                              INTRODUCTION

    Chairman Craig, Ranking Member Akaka and Members of the Committee 
on Veterans Affairs, this written testimony is provided in support of 
two of the bills that were discussed at the hearing today. The National 
Association of State Approving Agencies respectfully request that this 
testimony be placed in the record on the proceedings of the hearing.

                                REMARKS

    The Association is pleased to add its support to S. 2416, the 
Veterans Employment and Training Act of 2006 and S. 3363, a bill to 
extend the provisions of S. 2416. Specifically, S. 2416 amends title 
38, United States Code, to expand the scope of programs of education 
for which accelerated payment of educational assistance under the 
Montgomery GI Bill may be used. Similarly, S. 3363 extends the 
accelerated payment provision to survivors' and dependents' that are 
eligible for assistance under the Chapter 35 program. Both of these 
bills are significant improvements to the existing accelerated payment 
provision of law, section 3014A of title 38, United States Code, which 
limits payments to education leading to employment in high technology 
industries.
    In general, much has been done in recent years to provide 
servicemembers, veterans and other eligible persons with greater 
opportunities to use the education and training benefits to which they 
are entitled. Yet, the nature of the today's global economy demands 
that we continue to strive to help our workforce--especially our 
veterans--to gain new knowledge and learn new skills in order to 
maximize their contributions to the Nation. The provisions of S. 2416 
and S. 3363 help to provide these new learning opportunities in 
occupational areas where shortages currently or will exist.

                                CLOSING

    Thank Mr. Chairman, Ranking Member Akaka and Members of the 
Committee, for the opportunity to provide written testimony on bills 
being considered by the Committee. Additionally, we thank you for the 
leadership and support that you provide to our Nation's military 
personnel, veterans and their dependents.
                               __________

    Prepared Statement of Joseph A. Violante, National Legislative 
                Director, the Disabled American Veterans

    Mr. Chairman and Members of the Subcommittee:
    On behalf of the 1.3 million members of the Disabled American 
Veterans (DAV), I respectfully provide our comments on the following 
bills for the record.
    S. 2694 would amend existing law to permit attorneys and agents to 
charge claimants for services rendered in the preparation, 
presentation, and prosecution of claims. It would authorize the 
Secretary of Veterans Affairs to collect registration fees, set 
limitations for fees charged claimants, prescribe standards of conduct, 
and expand grounds for suspension or exclusion from further practice 
for attorneys and agents providing such services. It would subject 
veterans service organization representatives to the same rules for 
suspension.
    With removal of the limitation in current law that authorizes 
attorneys and agents to charge claimants fees only for services 
provided after the date on which the Board of Veterans' Appeals (BVA) 
first makes a decision in the case, fees could be charged at all stages 
of the administrative claims process. The Disabled American Veterans 
opposes this provision.
    Veterans should be able to file claims for disability benefits and 
receive fair decisions from the Department of Veterans Affairs (VA) 
without the necessity to hire and pay a large portion of their benefits 
to lawyers. Congress designed the current administrative claims process 
to be non-adversarial and pro-veteran. Unlike litigation in the courts 
where the parties must discover and produce their own evidence and 
affirmatively plead all the legal technicalities on which they base 
their suit, Congress obligated VA to assist the claimant in obtaining 
pertinent evidence and placed the duty upon VA to consider all relevant 
law and avenues of entitlement.
    Disability compensation and other benefits for veterans and their 
families should go to the intended beneficiaries for the purchase of 
the necessities of life and to meet other needs, not into the pockets 
of lawyers. That is the very reason the system was designed to work 
without lawyers and the wisdom behind the law that has for so long 
prohibited lawyers from charging veterans for filing and prosecuting 
claims: ``There would seem to be no need for the assistance of an 
attorney in order to initiate the claims process by completing and 
filing an application. Moreover, even if the initial decision is 
adverse, the Committee believes that it may be unnecessary for a 
claimant to incur the substantial expense for attorney representation 
that may not be involved in appealing the case for the first time to 
the BVA. The claimant may well prevail, as many claimants currently do, 
without legal representation when the case is first before BVA.'' S. 
Rep. No. 100-418, at 63-64 (1988). ``The Government interest, which has 
been articulated in congressional debates since the fee limitation was 
first enacted in 1862 during the Civil War, has been this: that the 
system for administering benefits should be managed in a sufficiently 
informal way that there should be no need for the employment of an 
attorney to obtain benefits to which a claimant was entitled, so that 
the claimant would receive the entirety of the award without having to 
divide it with a lawyer.'' Walters v. National Ass'n of Radiation 
Survivors, 473 U.S. 305, 321 (1985). By allowing lawyers to charge 
veterans for claims assistance, this bill abandons the commitment to a 
system that delivers benefits to veterans without necessity to pay 
lawyers.
    Under the best of circumstances, mistakes will be made in a mass 
adjudication system such as VA's, but claimants can guard against such 
mistakes through free representation from recognized veterans 
organizations. Veterans organization representatives also provide free 
advice, claims filing assistance, and a wide range of other assistance 
with matters not involving monetary awards. Lawyers will have no reason 
to assist veterans in matters that are not fee-producing. They will 
naturally limit their assistance to matters where there is potential 
for receiving for themselves a portion of the claimants' monetary 
benefits. Claimants who obtain the services of lawyers rather than 
through appointment of a veterans service organization representative 
may very well find themselves without the availability of free 
assistance in routine matters that they receive from veterans service 
organization representatives.
    We believe enactment of this bill will have far reaching 
detrimental effects that will far outweigh the emotional gratification 
of having the right to choose representation by a lawyer. The Court 
recognized the probable adverse effects in National Ass'n of Radiation 
Survivors:
    There can be little doubt that invalidation of the fee limitation 
would seriously frustrate the oft-repeated congressional purpose for 
enacting it. Attorneys would be freely employable by claimants to 
veterans' benefits, and the claimant would as a result end up paying 
part of the award, or its equivalent, to an attorney. But this would 
not be the only consequence of striking down the fee limitation that 
would be deleterious to the congressional plan.
    A necessary concomitant of Congress' desire that a veteran not need 
a representative to assist him in making his claim was that the system 
should be as informal and nonadversarial as possible. . . . The regular 
introduction of lawyers into the proceedings would be quite unlikely to 
further this goal. Describing the prospective impact of lawyers in 
probation revocation proceedings, we said in Gagnon v. Scarpelli, 411 
U.S. 778, 787-788, 93 S.Ct. 1756, 1762, 36 L.E.d.2d 656 (1973):
    ``The introduction of counsel into a revocation proceeding will 
alter significantly the nature of the proceeding. If counsel is 
provided for the probationer or parolee, the State in turn will 
normally provide its own counsel; lawyers, by training and disposition, 
are advocates and bound by professional duty to present all available 
evidence and arguments in support of their clients' positions and to 
contest with vigor all adverse evidence and views. The role of the 
hearing body itself . . . may become more akin to that of a judge at a 
trial, and less attuned to the rehabilitative needs of the individual. 
. . . Certainly, the decisionmaking process will be prolonged, and the 
financial cost to the State--for appointed counsel, . . . a longer 
record, and the possibility of judicial review will not be 
insubstantial.''
    We similarly noted in Wolff v. McDonnell, 418 U.S. 539, 570, 94 
S.Ct. 2963, 2981, 41 L.Ed.2d 935 (1974), that the use of counsel in 
prison disciplinary proceedings would ``inevitably give the proceedings 
a more adversary cast. . . .''
    Knowledgeable and thoughtful observers have made the same point in 
other language:
    ``To be sure, counsel can often perform useful functions even in 
welfare cases or other instances of mass justice; they may bring out 
facts ignored by or unknown to the authorities, or help to work out 
satisfactory compromises. But this is only one side of the coin. Under 
our adversary system the role of counsel is not to make sure the truth 
is ascertained but to advance his client's cause by any ethical means. 
Within the limits of professional propriety, causing delay and sowing 
confusion not only are his right but may be his duty. The appearance of 
counsel for the citizen is likely to lead the government to provide one 
or at least to cause the government's representative to act like one. 
The result may be to turn what might have been a short conference 
leading to an amicable result into a protracted controversy.
    ``These problems concerning counsel and confrontation inevitably 
bring up the question whether we would not do better to abandon the 
adversary system in certain areas of mass justice. . . . While such an 
experiment would be a sharp break with our tradition of adversary 
process, that tradition, which has come under serious general challenge 
from a thoughtful and distinguished judge, was not formulated for a 
situation in which many thousands of hearings must be provided each 
month.'' Friendly, ``Some Kind of Hearing,'' 123 U.Pa.L.Rev. 1267, 
1287-1290 (1975).
    Thus, even apart from the frustration of Congress' principal goal 
of wanting the veteran to get the entirety of the award, the 
destruction of the fee limitation would bid fair to complicate a 
proceeding which Congress wished to keep as simple as possible. It is 
scarcely open to doubt that if claimants were permitted to retain 
compensated attorneys the day might come when it could be said that an 
attorney might indeed be necessary to present a claim properly in a 
system rendered more adversary and more complex by the very presence of 
lawyer representation. It is only a small step beyond that to the 
situation in which the claimant who has a factually simple and 
obviously deserving claim may nonetheless feel impelled to retain an 
attorney simply because so many other claimants retain attorneys. And 
this additional complexity will undoubtedly engender greater 
administrative costs, with the end result being that less Government 
money reaches its intended beneficiaries.

                           473 U.S. AT 323-26

    It is understandable why some attorneys advocate changing the 
system. Perhaps veterans who advocate it do so under the belief that 
they would generally receive better representation by attorneys. Data 
on the subject simply do not support that belief. Attorneys presumably 
choose only the cases they believe more meritorious, where most 
veterans service organizations essentially represent any claimant and 
do not refuse representation in cases merely because of a lower 
likelihood of favorable outcome. Nonetheless, historically and 
currently, attorneys still have no greater success rate in BVA appeals, 
for example, than veterans service organization representatives. In 
2005, the average BVA allowance rate among veterans service 
organizations was 21.7 percent. The allowance rate for attorneys was 
21.1 percent. Average allowance rates among the veterans service 
organizations are again higher than allowance rates for attorneys thus 
far in 2006. With a 21.3 percent allowance rate as of the end of April 
2006, attorneys are below the overall average BVA allowance rate for 
all appeals including those with no representation of 21.6 percent.
    Beyond our opposition to removal of restrictions on attorneys' 
fees, we have other concerns about provisions of S. 2694. Section 2(b) 
of the bill would amend section 5904(b) of title 38, United States 
Code, by adding more grounds for suspending or excluding attorneys and 
agents from further practice. These additional grounds are: (1) failure 
of the attorney or agent ``to conduct himself or herself with due 
regard for the non-adversarial nature of any proceeding before the 
Department,'' (2) submittal of ``frivolous claims, issues, or 
arguments,'' and (8) failure ``to comply with any other condition 
specified by the Secretary in regulations prescribed by the Secretary 
for purposes of this subsection.'' Section 2(a)(2) of the bill provides 
that veterans organization representatives may be suspended on the 
grounds in section 5904(b) applicable to suspension and exclusion from 
further practice in the case of attorneys and agents.
    The Secretary of Veterans Affairs has promulgated a comprehensive 
rule governing suspension and termination of accreditation of 
representatives. We believe additional statutory provisions for 
suspension of veterans service organization representatives are 
unnecessary. Moreover, we believe the new grounds that would be added 
by section 2(b) of the bill are so broad and vague as to be difficult 
to follow or enforce. For example, it is unclear what would be 
considered an action without ``due regard for the non-adversarial 
nature of any proceeding before the Department.'' In addition, given 
that VA has a duty to seek supporting evidence for a veteran's claim, 
the law does not require that such claim be accompanied by evidence. 
Attorneys, agents, and representatives will sometimes be unable to 
determine the factual merits of a claim before it is submitted. Under 
these circumstances and many others that are unlike those of more 
traditional proceedings, it will be more difficult to define frivolous 
claims. We believe these additional rules will unnecessarily complicate 
the process.
    We also have some concern, should the bill be enacted, that it 
authorizes VA oversight only for contingency fee agreements under which 
the Secretary is to pay the attorney directly from past-due benefits 
awarded on the basis of the claim. We believe this leaves open the 
possibility for abuse.
    For these reasons, we believe enactment of these provisions will 
profoundly change the administrative claims process to the detriment of 
veterans and other claimants. We believe there is a potential for wide-
ranging unintended consequences that will be beneficial for neither 
claimants nor the Government. Beyond the cost to veterans, added 
administrative costs for VA are likely to be substantial, without 
commensurate added advantages or benefits for either.
    S. 2562, the Veterans' Compensation Cost-of-Living Adjustment Act 
of 2006, would increase, effective as of December 1, 2006, the rates of 
disability compensation for veterans with service-connected 
disabilities and the rates of dependency and indemnity compensation for 
survivors of certain service-connected disabled veterans. However, 
within the cost-of-living adjustment (COLA) measure is a provision that 
``Each dollar amount increased under paragraph (1), if not a whole 
dollar amount, shall be rounded to the next lower whole dollar 
amount.'' (The DAV supports the overall intent of this bill.) To 
maintain the value of veterans' benefits, they must be adjusted to keep 
pace with the rise in the cost of living. Rounding down the adjusted 
rates to the next lower dollar amount, however, will gradually erode 
the value of benefits over time and thus benefits will not keep pace 
with the rise in the cost of living. Rounding down veterans' cost-of-
living adjustments unfairly targets veterans for convenient cost 
savings for the government. Additionally, the DAV supports legislation 
that would provide for automatic annual adjustments, based on increases 
in the cost of living, for specially adapted housing and automobile 
grants to assist eligible disabled veterans and servicemembers. These 
grants must be adjusted annually if they are to keep pace with the rise 
in the cost of living and remain meaningful benefits.
    Because the issues addressed within the following bills are not 
specific to its legislative focus, the DAV has no resolutions 
pertaining to these measures. However, because they would benefit 
veterans and their family members, the DAV has no objection to their 
favorable consideration:
     S. 2659, the Native American Veterans Cemetery Act of 
2005, would amend title 38, United States Code, to provide for the 
eligibility of Indian tribal organizations for grants for the 
establishment of veterans' cemeteries on trust lands.
     S. 2416, the Veterans Employment and Training Act of 2006, 
would provide flexibility in the programs of education for which 
accelerated payments of educational assistance under the Montgomery GI 
Bill (MGIB) may be used. Specifically, it would allow MGIB payments to 
be used for tuition for education programs that lead to certification 
or licensure in an occupation, or leads to occupation in an industry 
that has a critical shortage of employees or is an industry that is 
experiencing a high growth rate.
     S.--, draft legislation, would authorize accelerated 
payments of educational assistance for survivors and dependents of 
veterans who died or are permanently and totally disabled as a result 
of a disability arising from active military service. Specifically, it 
would allow such payments to be used for tuition for education programs 
that lead to certification or licensure in an occupation in a high 
technology field, or leads to occupation in an industry that has a 
critical shortage of employees or is an industry that is experiencing a 
high growth rate.
     S. 2121, the Veterans' Housing Fairness Act of 2005, would 
provide housing loan benefits for the purchase of residential 
cooperative apartment units.
    We appreciate the Committee's interest in ensuring the 
effectiveness of programs for disabled veterans, and we appreciate the 
opportunity to present DAV's views.
                              National Organization
                                    of Veteran's Advocates,
                                                      May 22, 2006.
Hon. Larry Craig,
Chairman, Committee on Veterans' Affairs,
Russell Senate Office Building,
Washington, DC.
    Dear Mr. Chairman: I am writing to you on behalf of the National 
Organization of Veterans' Advocates to offer the following testimony in 
support of Senate Bill S. 2694. This bill, if enacted, would provide 
veterans with the choice to hire counsel when they file their initial 
claims at the Regional Office. The Floor Statement submitted with this 
bill accurately explained that the point at which a veteran can hire 
counsel under current law is too late in the process for counsel to be 
truly effective because by that time the evidentiary record is 
effectively closed. . .if attorneys were retained at an earlier stage 
of the process, they could be helpful in obtaining and presenting 
necessary evidence and in ensuring that VA timely and accurately 
processes claims.
    NOVA believes that veterans should have the right to choose whether 
they wish to hire a lawyer. Every year NOVA members receive calls from 
many veterans requesting assistance with their claims that are pending 
before the VA. Unfortunately, given the fee limitations in 38 U.S.C. 
5904, our members are not able to assist veterans at this critical 
stage of the proceedings. The best opportunity for an attorney to 
assist a veteran is before the Board of Veterans' Appeals denies the 
claim because the record is not closed. S. 2694 would give the veterans 
the choice to hire counsel during this crucial time period.
    The United States Court of Appeals for Veterans Claims awarded NOVA 
the Hart T. Mankin Distinguished Service Award in 2000. In presenting 
the award, the Board of Judges specifically recognized that NOVA's 
continuing legal education programs provide valuable training for 
attorneys. For over 10 years, NOVA has offered continuing legal 
education, and it is the founding principle that led to the formation 
of our organization. Therefore, NOVA supports the provisions of this 
bill that require the VA to ensure that all attorneys who practice 
before the VA have adequate training or experience in this specialized 
area of the law.
    While NOVA fully supports S. 2694, we urge you to examine the 
following issues. First, as proposed, S. 2694 would only apply to 
veterans' claims filed after the effective date of the legislation. The 
proposed bill would artificially create two categories of veterans 
based upon date of filing: those permitted to hire counsel because 
their claims are filed after the date of enactment, and those who are 
not allowed to hire counsel. According to a recent GAO study, there 
were three hundred forty-six thousand veterans claims pending at the 
end of fiscal year 2005. All of those veterans would be precluded from 
hiring counsel under S. 2694 as proposed. Such a limitation of the 
right to counsel appears to significantly undermine the rationale for 
and purpose of the legislation. Moreover, as VA claims can take years 
if not decades to resolve this dichotomy will exist for years to come. 
It is not at all apparent why a veteran seeking a straightforward 
increase in a rating filed the day after the legislation becomes 
effective should have a right to hire counsel, while a veteran seeking 
the same benefit the day before the act becomes effective should not. 
NOVA urges you to make the law effective for all veterans who have 
claims pending on the date of enactment as well as for those veterans 
who file claims after the date of enactment.
    Second, the bill should include a provision which eliminates the 
permissive language in 38 U.S.C. 5904. When 5904 was originally 
enacted the law provided that the Secretary may withhold and pay a 20 
percent contingent fee to the attorney. NOVA urges that the permissive 
language of 5904 ``may'' be changed to a mandatory statement that the 
Secretary ``shall'' withhold and pay.
    For these reasons, NOVA strongly supports the Veterans Choice of 
Representation Act of 2006 and urges you to consider these comments as 
you work with your colleagues in the House to enact this legislation. 
If you have any questions or need any assistance please feel free to 
contact me. Thank you for your time and efforts on behalf of veterans.

            Very truly yours,
                                        Robert V. Chisholm,
                                                    Past President.
                           Navajo Nation Washington Office,
                                                      May 26, 2006.
Sen. Daniel Akaka,
U.S. Senate,
Washington, DC.
    Dear Senator Akaka: On behalf of the Navajo Nation, I am writing to 
thank you for the introduction on the S. 2659, the ``Native American 
Veterans Cemetery Act of 2006.'' Currently, the Navajo Nation's only 
Veterans cemetery is full and the Navajo Nation is without access to 
grant funding establish and maintain a Veterans cemetery. Navajo 
Veterans who wished to be laid to rest with military honors among 
fellow Native American warriors must be laid to rest far from the 
aboriginal homeland they fought to protect. S. 2659 will allow Native 
American to be buried near their families and in their homeland.
    Another important issue for Navajo veterans is access to Improved 
Veterans health care. Currently, the Navajo Nation and the Veterans 
Health Administration are discussing the proposed placement of a VA 
health clinic within the Navajo Nation.
    The Navajo Nation respectfully requests Senator Akaka's continued 
support these two important measures. Furthermore, the Navajo Nation 
Washington Office will continue to work to see additional support for 
S. 2659 among Congress and the National American Indian Veterans 
Services Organization, Inc.
    Again, thank you for introducing S. 29 and the Navajo Nation looks 
to your leadership for S. 2659's movement. If there are questions, 
please feel free contact me at the Navajo Nation Washington Office at 
(202) 775-0393.

            Sincerely,
                                  Sharon Clahchischilliage,
                                                Executive Director.
                                  

```