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44–929 2009

OVERSIGHT OF GI BILL IMPLEMENTATION 

HEARING 

BEFORE THE

SUBCOMMITTEE ON ECONOMIC OPPORTUNITY 

OF THE

COMMITTEE ON VETERANS’ AFFAIRS 

U.S. HOUSE OF REPRESENTATIVES 

ONE HUNDRED TENTH CONGRESS 

SECOND SESSION 

SEPTEMBER 11, 2008 

Serial No. 110–103 

Printed for the use of the Committee on Veterans’ Affairs 

( 

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COMMITTEE ON VETERANS’ AFFAIRS 

BOB FILNER, California, Chairman 

CORRINE BROWN, Florida 

VIC SNYDER, Arkansas 

MICHAEL H. MICHAUD, Maine 

STEPHANIE HERSETH SANDLIN, South 

Dakota 

HARRY E. MITCHELL, Arizona 

JOHN J. HALL, New York 

PHIL HARE, Illinois 

SHELLEY BERKLEY, Nevada 

JOHN T. SALAZAR, Colorado 

CIRO D. RODRIGUEZ, Texas 

JOE DONNELLY, Indiana 

JERRY MCNERNEY, California 

ZACHARY T. SPACE, Ohio 

TIMOTHY J. WALZ, Minnesota 

DONALD J. CAZAYOUX, JR., Louisiana 

STEVE BUYER, Indiana, Ranking 

CLIFF STEARNS, Florida 

JERRY MORAN, Kansas 

HENRY E. BROWN, JR., South Carolina 

JEFF MILLER, Florida 

JOHN BOOZMAN, Arkansas 

GINNY BROWN-WAITE, Florida 

MICHAEL R. TURNER, Ohio 

BRIAN P. BILBRAY, California 

DOUG LAMBORN, Colorado 

GUS M. BILIRAKIS, Florida 

VERN BUCHANAN, Florida 

STEVE SCALISE, Louisiana 

MALCOM A. SHORTER, Staff Director 

SUBCOMMITTEE ON ECONOMIC OPPORTUNITY 

STEPHANIE HERSETH SANDLIN, South Dakota, Chairwoman 

JOE DONNELLY, Indiana 

JERRY MCNERNEY, California 

JOHN J. HALL, New York 

JOHN BOOZMAN, Arkansas, Ranking 

JERRY MORAN, Kansas 

STEVE SCALISE, Louisiana 

Pursuant to clause 2(e)(4) of Rule XI of the Rules of the House, public hearing records 

of the Committee on Veterans’ Affairs are also published in electronic form. The printed 

hearing record remains the official version. Because electronic submissions are used to 

prepare both printed and electronic versions of the hearing record, the process of converting 

between various electronic formats may introduce unintentional errors or omissions. Such occurrences are inherent in the current publication process and should diminish as the process 

is further refined. 

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C O N T E N T S 

SEPTEMBER 11, 2008 

Page 

Oversight of GI Bill Implementation ..................................................................... 1 

OPENING STATEMENTS 

Chairwoman Stephanie Herseth Sandlin .............................................................. 1 

Prepared statement of Chairwoman Herseth Sandlin .................................. 26 

Hon. John Boozman, Ranking Republican Member ............................................. 2 

Prepared statement of Congressman Boozman ............................................. 26 

Hon. Bob Filner ....................................................................................................... 3 

WITNESSES 

U.S. Department of Veterans Affairs, Keith Pedigo, Associate Deputy Under 

Secretary for Policy and Program Management, Veterans Benefits Administration ................................................................................................................... 6 

Prepared statement of Mr. Pedigo .................................................................. 27 

MATERIAL SUBMITTED FOR THE RECORD 

Post-Hearing Questions and Responses for the Record: 

Hon. Stephanie Herseth Sandlin, Chairwoman, Subcommittee on Economic 

Opportunity, Committee on Veterans’ Affairs, to Hon. James B. Peake, 

Secretary, U.S. Department of Veterans Affairs, letter dated December 

8, 2008, and VA responses ............................................................................... 31 

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(1) 

OVERSIGHT OF GI BILL IMPLEMENTATION 

THURSDAY, SEPTEMBER 11, 2008 

U.S. HOUSE OF REPRESENTATIVES, 

COMMITTEE ON VETERANS’ AFFAIRS, 

SUBCOMMITTEE ON ECONOMIC OPPORTUNITY, 

Washington, DC. 

The Subcommittee met, pursuant to notice, at 1:07 p.m., in 

Room 340, Cannon House Office Building, Hon. Stephanie Herseth 

Sandlin [Chairwoman of the Subcommittee] presiding. 

Present: Representatives Herseth Sandlin, Donnelly, McNerney, 

Hall, Boozman, Moran, and Scalise. 

Also Present: Representatives Filner and Snyder. 

OPENING STATEMENT OF CHAIRWOMAN HERSETH SANDLIN 

Ms. HERSETH SANDLIN. Good afternoon, ladies and gentlemen. 

The Committee on Veterans’ Affairs, Subcommittee on Economic 

Opportunity, oversight hearing on the implementation of the GI 

Bill, as updated in Public Law 110–252, will come to order. 

Before we proceed with today’s hearing, I would like to take a 

moment to remember the lives we lost on the morning of September 11, 2001. As our country continues to heal from this tragic 

event of 9/11, we must never forget that today we have thousands 

of troops serving honorably in Iraq and Afghanistan, many of 

whom have served in multiple deployments overseas. 

I would like to express my sincere thanks and appreciation to our 

men and women in uniform who have answered the Nation’s call 

to duty, and reinforced my commitment to serve them honorably as 

they continue to serve us all. 

Keeping this in mind, we must never forget that today’s servicemembers are tomorrow’s veterans, who will require the resources 

to succeed in life after military service. To this end, this Subcommittee has held numerous hearings, here in Washington, DC, 

and our Congressional districts, on programs critical to their continued success. One such program in which we were able to make 

significant progress is the Montgomery GI Bill. Public Law 110– 

252 will provide our veterans the educational entitlements needed 

to attend a college or university of their choice. Certainly this landmark legislation makes significant improvements, but we must remain vigilant to ensure Congressional intent is fully implemented, 

and the U.S. Department of Veterans Affairs (VA) is afforded the 

resources to meet the needs mandated by Congress. 

Today’s hearing will give the Subcommittee the opportunity to 

better understand the VA’s implementation plan as required by 

Public Law 110–252. As many of you may be aware, there have 

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been numerous concerns over the VA’s plan to contract out services, contracting transparency, and time constraints to implement 

the requirements of the newly enacted law. Last month, we sent 

a letter inviting Secretary Peake to participate in today’s hearing. 

This letter specifically states that the purpose of the hearing today 

was to have the VA present its plan on implementing Chapter 33 

with as much detail as possible. I am deeply disappointed that the 

testimony that was submitted was not as extensive as we were 

hoping, although we did get some additional material at about 

12:30 today. I hope that over the next few weeks we can be properly informed on the VA’s plan to meet Public Law 110–252, including the information that is presented today. 

I look forward to working with Ranking Member Boozman and 

Members of this Subcommittee to provide oversight on the implementation of the new Montgomery GI Bill requirements. 

[The prepared statement of Chairwoman Herseth Sandlin appears on p. 26.] 

Ms. HERSETH SANDLIN. I now recognize Mr. Boozman for any 

opening remarks he may have. 

OPENING STATEMENT OF HON. JOHN BOOZMAN 

Mr. BOOZMAN. Thank you, Madam Chairman. I would like to associate my remarks concerning the anniversary of today and 

things, and appreciate you taking the time to mention that, along 

with the recognition of our people in uniform now. 

I would like to concur with the chair’s dissatisfaction with the 

prepared testimony. I believe the invitation letter was sufficiently 

detailed regarding our expectations for today’s hearing. And while 

I recognize the VA may be constrained regarding competition-sensitive information, describing the Department’s desires expressed 

in the statement of objectives provided to the industry is well within their authority. 

I expect the Department to provide the Subcommittee with a 

very detailed briefing on those objectives, and the winning bidder’s 

plan to meet them, very shortly after the contract is awarded, at 

the least. It is ironic and fitting that we are holding a hearing on 

the 9/11 GI Bill 7 years after the attack on America, an event that 

contributed to today’s global conflict. The Global War on Terror has 

highlighted the need to create a new GI Bill that reflects the increased obligations of today’s servicemembers and their families. In 

addition to caring for our dead and wounded, there is no more important benefit to offer a path to personal growth then through a 

generous education benefit. As you may remember, the Subcommittee on Economic Opportunity, under Chairwoman Herseth 

Sandlin’s leadership, reported a GI Bill that I believe was an excellent bill, and I think superior in many ways to what eventually became law. H.R. 5684 was simpler to administrate, more flexible, 

and offered $19,000 per year for full-time enrollment. The bill was 

eventually passed by the full Committee, but failed to make it to 

the floor. So we’re here today to really have the VA describe how 

they intend to implement the very complex program in Chapter 33. 

Frankly, I am very concerned that despite VA’s best efforts, they 

will not meet the August 1, 2009, deadline. We are aware that VA 

intends to contract out a significant portion of the effort to bring 

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the program online, but they now have less than 11 months to get 

the work done. I hope that we have not given them an insurmountable task. 

I am also aware there is some opposition to VA’s intent to contract out development of the new information technology (IT) system, and possibly some personnel issues. I would remind those who 

oppose using modern information technology to manage the system 

that it is the most promising way to shorten the processing time. 

While a small number of cases may require manual intervention, 

because of the complexity, the vast majority should lend themselves to automated process. I am confident that if we ask veterans 

whether they would prefer the current method that now takes 

about 20 days, or an automated process that could provide an answer in minutes, that they will choose the latter. I believe there is 

an example of this at the Department of Education, and I would 

ask VA whether they have looked into that model. 

As to whether the IT should be developed in-house or via contract, those who point to the failure of Core FLS should also remember that VETSNET is primarily an in-house project that has 

been in development since the late eighties, and has experienced 

numerous failures, and has cost the Government over $600 million. 

From reading VA’s testimony, there is ample opportunity for VA 

employees to remain employed in the Education Service or elsewhere within the Veterans Benefits Administration (VBA). 

My point is that we have given the VA a complex new program 

to manage, and until their selected approach to implementing that 

program fails, we should not interfere. You should be about meeting the need of veterans seeking education, and no other agenda. 

Madam Chair, this Subcommittee has worked hard for 4 years 

in a bipartisan way to do the right thing by those who have borne 

the battle. If VA believes they need any additional legislation, I 

hope they will provide that to us in time for us to act. I look forward to hearing from the Department today, and I hope their testimony will not only describe the major features of the proposed contract, but also a frank and candid assessment of the challenges 

they face. 

I yield back. 

[The prepared statement of Congressman Boozman appears on 

p. 26.] 

Ms. HERSETH SANDLIN. Thank you very much, Mr. Boozman. I 

would now like to recognize the Chairman of the full Committee, 

Mr. Filner, for an opening statement. 

OPENING STATEMENT OF HON. BOB FILNER 

Mr. FILNER. Thank you, Madam Chair. I want to thank you and 

Mr. Boozman for your leadership on these issues over the past several years. You have been a model of bipartisan cooperation, and 

the bill that was passed and signed by the President is a great bill. 

And now, of course, timely oversight. So I thank you for your leadership. 

As you stated, this was an opportunity for the VA to tell us how 

they were going to meet their deadlines. Like you, when I saw only 

four pages of testimony, and a PowerPoint presentation, I am not 

sure that gives us enough detail to understand what is happening. 

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I do not believe that is a service to all of the stakeholders who are 

looking to this with such great optimism and hope. The letter that 

the Chair and Ranking Member sent to Secretary Peake stated 

that the purpose of the hearing was to present VA’s plan with as 

much detail as possible. We wanted to have a thorough understanding of what was going on, and I hope you will do that in the 

testimony today. 

I have great doubts about contracting out. VA employees have 

administered education benefits since the end of World War II. We 

know that many changes have been made over the years and they 

have been successfully implemented. You have, as I understand it, 

about 250,000 employees that are working. You have a year to do 

this and you have close to a $100 billion budget. If I was in charge 

of all of that, I would not be asking for more money. I do not know 

what your ballpark is because you have not put that in any of the 

figures before us today. I do not know why you need to contract out 

services, with so many employees, so much money, and so much 

time. 

I do not think that replacing the VA employees with inexperienced contractors is very good business. Many VA employees, as 

you well know, are veterans themselves and identify with those 

veterans applying for benefits. VA employees are there for one reason, to help the veterans. How can the VA justify replacing employees with contractors, which I bet in the Request For Proposal (RFP) 

it does not say, ‘‘Do you relate to veterans?’’ Their primary concern 

is not serving veterans. You argue, that the need is to have this 

in place by August of 2009. I do not see how you can meet that 

deadline when you are spending all of your time seeking bids out 

to contract out, implementing a new software program, and training new staff with very little or zero experience. If the VA has been 

improving its processing time for educational entitlements over the 

years, why throw away all those gains that have been made? 

I notice in the handout, and I am sure you will explain this further, your first objective of the RFP is that you will meet all the 

requirements. And then, number four says, ‘‘Oh, by March 2009, 

we will determine if the solution meets these requirements.’’ 

What are you giving out in an RFP about meeting the requirements and what happens in March if they have not met the requirements? It seems to me that we are back to square one. 

Can you give me a yes or no right now? Are there any penalties 

if they do not meet these deadlines? Where in the RFP is a statement of penalties? I did not see any. 

Mr. PEDIGO. There are penalties in the statement. 

Mr. FILNER. Like what? 

Mr. PEDIGO. Statement of objectives—— 

Mr. FILNER. Do they get any money for the contract if they do 

not meet the objectives? 

Mr. PEDIGO. Let me ask Mr. Wilson to address that. 

Mr. WILSON. The RFP proposes that the vendor will propose both 

monetary incentives and monetary disincentives. 

Mr. FILNER. Oh, they are proposing? 

Mr. WILSON. And the reason that we did that is that will help 

us get an understanding of how confident they are in their proposed solution. 

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Mr. FILNER. Someday I would like you to read what you just 

said, and see why the public has so little confidence in people we 

call bureaucrats. You want someone, and I do not know how much 

money we are going to pay, perhaps millions of dollars, to meet a 

deadline, and you want to know about their confidence in meeting 

it as part of the RFP? That sounds pretty ridiculous to me. I am 

just a layman, but someone is going to get a lot of money, so why 

should they be paid if they do not even meet the objectives that you 

have laid out here? I do not understand that at all. 

You should be right now in the process of implementing this program in-house, training your staff, and giving them a year of preparation instead of contracting it out. This is a Government function, and it should continue to be a Government function. If we 

have capable employees that have been trained in this capacity to 

implement and distribute Montgomery GI Bill entitlements, and 

the VA was given money this year for over 800 more employees, 

why is there a need to outsource the whole program? The VA’s 

focus should be on building up your internal success, and not just 

saying, ‘‘Hey, we cannot do it.’’ 

We have received, on this Committee, letters from VA employees 

expressing their concerns. One person wrote that the VA employees 

are better equipped to handle the educational benefits because, 

number one, they are familiar with the U.S. Department of Defense 

(DoD) documents that need to be reviewed to establish veterans’ 

benefits eligibility; number two, they are trained to use various 

DoD databases to locate and confirm information; they are trained 

to process claims when veterans appeal the decision; they are 

trained to contact individual service branches; and, they are 

trained to contact State approving agencies, colleges, universities, 

and veterans service organizations. Your contractor is going to 

have to figure all that out. 

In addition, employees need to understand all the benefit programs, not just the GI Bill. Knowing all of the benefit programs 

helps in processing education benefits, because most veterans are 

eligible for benefits that they may not know about or they may be 

under different categories. 

I do not see how you can expect to train new employees, or the 

contractors, to know all the ins and outs of the VA, be familiar 

with these DoD documents and databases, and be familiar with the 

benefit programs, in 1 year. 

Finally, I am concerned that the contracting bids are not as accessible to the public as they should be. There is a need for transparency, and the VA has not been totally forthcoming with all the 

information. I hope you take the opportunity today to clear up any 

of these misconceptions, and thoroughly inform the Committee of 

your plans to meet the requirements of Public Law 110–252. It is 

very discouraging to see how all of this started. Again, you give us 

four pages of testimony, and a PowerPoint presentation. It does not 

look like you have any accountability in this whole process. It says 

you are not going to determine if they meet the requirements of the 

GI Bill until March 1, 2009. What kind of nonsense is that? That 

you are giving out an RFP, and you do not even know if it is going 

to meet the requirements until next March? And what if it does 

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not? As I said, we are back to square one. And the penalties, ‘‘they’’ 

are going to suggest the penalties? Come on, guys. 

To me, I do not want to pay for this if they do not meet the requirements that you have set out. But we should not be doing this 

anyway, because we have the employees who know how to do it, 

and they have been doing it for years and years. Let them do the 

job. 

Thank you, Madam Chair. 

Ms. HERSETH SANDLIN. Thank you, Mr. Chairman. 

I now want to welcome our two panelists testifying before the 

Subcommittee today. Joining us on the first and only panel today 

is Mr. Keith Pedigo, Associate Deputy Under Secretary for Policy 

and Program Management, Department of Veterans Affairs. Mr. 

Pedigo is accompanied by Mr. Keith Wilson, Director of the Office 

of Education Service, Veterans Benefits Administration, Department of Veterans Affairs. 

Mr. Pedigo, you are now recognized to make your presentation to 

the Subcommittee. 

STATEMENT OF KEITH PEDIGO, ASSOCIATE DEPUTY UNDER 

SECRETARY FOR POLICY AND PROGRAM MANAGEMENT, 

VETERANS BENEFITS ADMINISTRATION, U.S. DEPARTMENT 

OF VETERANS AFFAIRS; ACCOMPANIED BY KEITH M. WILSON, DIRECTOR OF EDUCATION SERVICE, VETERANS BENEFIT ADMINISTRATION, U.S. DEPARTMENT OF VETERANS 

AFFAIRS 

Mr. PEDIGO. Thank you, Madam Chairwoman. We are happy to 

be here this afternoon. I want to take this opportunity to try to provide as much information as possible about the approach that we 

are using to implement the new GI Bill. As I say, we appreciate 

the opportunity to be here, to talk to you about the strategy for implementation of Public Law 110–252, the post-9/11 GI Bill. And as 

you said, accompanying me today is Mr. Keith Wilson, Director of 

the VA’s Education Service. 

My testimony will highlight the staffing information and technology solutions being pursued by VA. Mr. Wilson and I are also 

prepared to provide a PowerPoint presentation that addresses selected element of the procurement process that is presently underway to identify a contractor to provide a secure solution to support 

VA’s efforts to administer this new program. 

Our strategy for implementation of this program calls for contractor support to build upon and accelerate an already existing 

strategy to employ a rules-based industry-standard technology in 

the delivery of education benefits. VA’s numerous education programs contain eligibility rules and benefit determinations that 

work well with rules-based technology that requires minimal 

human intervention. 

The goal of minimizing human intervention through the electronic processing of applications and enrollment information was 

outlined in both the VA’s fiscal 2008 and 2009 budgets. I would like 

to emphasize that the contractor will not have full responsibility 

over the administration of the post-9/11 GI Bill. Instead, the contractor will be responsible for development of the information technology solution, and general administrative and data entry funcjbell on PROD1PC69 with HEARING

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tions. Education claims that are rejected by the automated process 

and require manual eligibility determinations will remain the responsibility of trained VA personnel. 

VA plans to award a contract for support in the very near future. 

The contractor will be accountable for providing timely and accurate education claims processing by completing original claims in 

at least 10 days, supplemental claims in at least 7 days, and by 

achieving an accuracy rate of at least 98 percent. The technological 

solution and services provided will be under close direction and 

oversight of VA employees. 

Since enactment of the post-9/11 GI Bill, VA’s Education Service 

has been working with other elements of VA to enhance key existing VA IT systems. For example, the VA application that allows 

schools’ certifying officials to transmit enrollment data electronically to VA is being modified to accommodate the reporting requirements of the new program. 

VA is also working closely with elements of the Department of 

Defense to establish data requirements and procedures for implementation of the transferability provisions of the new program. Our 

goal is to transition servicemembers and veterans into the new program with no disruption in the payment of educational benefits, in 

accordance with the August 1, 2009, effective date for the new program. 

Based on the implementation strategies being pursued, VA does 

not anticipate a loss of Federal employment for any present employees associated with VA’s education programs. Since the post-9/ 

11 bill will result in tuition and fee payments being made directly 

to educational institutions, some current claims processing resources will the shifted to increase compliance and oversight responsibilities. VA employees will continue to staff and operate our 

nationwide call center in Muskogee, Oklahoma. VA employees will 

also continue to respond to all online inquiries through the VA Web 

site, including post-9/11 GI Bill inquiries. 

The provisions of the post-9/11 GI Bill require VA to develop regulations to administer the program. VA is actively engaged in this 

process, and we anticipate publishing the program’s final regulations in the Federal Register in May of 2009. 

Outreach to veterans and servicemembers is a key objective of 

our implementation plan for the new program. The VA’s GI Bill 

Web site has been updated to include information regarding the 

new program, and already over a quarter of a million have viewed 

the ‘‘frequently asked questions’’ section of that site. 

In addition to our web-based outreach, VA is preparing posters, 

pamphlets, and direct mailings to veterans, servicemembers, colleges, and university Executives. Also, in late 2008, VA will launch 

a multimedia advertising campaign in an effort to reach individuals who may have dropped from our direct mailing rolls. These 

are individuals who have left the military and have not used VA 

benefits, or have relocated since last using a VA benefit. 

Madam Chairwoman, this concludes my statement. I will be 

pleased to answer any questions you or other Members of the Subcommittee may have. 

[The prepared statement of Mr. Pedigo, and the PowerPoint 

slides, appears on p. 27.] 

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Ms. HERSETH SANDLIN. Did you want to take us through the 

PowerPoint presentation at this time, Mr. Pedigo? 

Mr. PEDIGO. We would be happy to do that. 

Ms. HERSETH SANDLIN. Okay. 

Mr. PEDIGO. What I would like to do, if it is okay with you, is 

I will handle the first couple of slides, and then I will ask Mr. Wilson to go through the remaining portions of the presentation. If we 

could please go to the first slide. 

What I want to make sure that the Subcommittee understands 

is that our decision to basically provide a secure IT solution for the 

new GI Bill is not a new strategy. As I said in my testimony, that 

strategy was articulated in both the 2008 and 2009 President’s 

budgets. It has been our intent for at least the last 2 years to take 

our existing systems in VA, and primarily, what we call the TEES 

system, which is The Education Expert System, and develop that 

into a rules-based engine that would be capable of making most of 

the decisions on the existing VA education programs. And when I 

say ‘‘existing programs,’’ I’m talking about those that existed prior 

to the implementation of the new GI Bill. 

Under the strategy that we are using to implement the new GI 

Bill, we are simply accelerating the already-existing strategy. And 

because of the urgency of meeting the August 1, 2009, effective 

date for this program, we felt the need to seek vendor support to 

help build this implementation technology solution. At the present 

time, because of the nature of the procurement that we are using, 

we do not know the details of the proposed solution from the vendors to implement the GI Bill. And that is because the vehicle that 

we are using is what is known as a performance-based contract, 

where essentially we go out to those who would provide bids to us, 

and we tell them what the basic requirements are that we want 

them to solve, and then they use industry best practices, and propose a solution on how we can best implement the new GI Bill. 

So at this point in the procurement process, we do not know, we 

have not seen the proposals that the bidders are going to submit 

to us. But before the end of this month, we will have a very good 

idea of what those proposals are. 

And I want to emphasize that with respect to VA employees, we 

do not have any plans to put any VA employees out on the street 

as a result of this new program. Our intention is to use what will 

probably be a significant number of the existing employees to continue to process the programs that existed in the education area 

prior to the new GI Bill, and we have five programs that will have 

to continue to be administered. We are going to use these new employees to take all the calls at the Muskogee, Oklahoma, call center. And these employees will be particularly involved in—if you 

could go to the next slide, please—these employees will be particularly involved with handling cases that the information technology 

solution is not able to handle. It is our expectation that the rulesbased system that we will have will be capable of making most decisions on veterans’ entitlement and eligibility for the new GI Bill 

in an automated fashion without human intervention, but we recognize that because of the complexity of this bill, and because of 

the nuances of the service time and nature of military service for 

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some veterans that the system cannot handle all cases. And so the 

exceptions will be handled by full-time VA staff. 

I want to mention that the VA, especially VBA, the Veterans 

Benefits Administration, has a solid record over the last 15 years 

of making significant consolidations in operations, and providing a 

soft landing for the employees who might no longer be engaged in 

the activity of that particular consolidated program. In the VA’s insurance program, as well as the education program, in the early 

nineties, and the loan guarantee program in the late nineties and 

the early part of this century, we underwent significant consolidations, and no employee lost VA employment as a result of that. 

At this point, Madam Chairwoman, I am going to turn it over to 

Keith Wilson, to go through the remainder of the slides. 

Mr. WILSON. Thank you, Keith. Good afternoon. 

I would like to go over, first, two timelines; the first being the 

acquisition timeline, followed by the project milestone timelines, 

once the contract is awarded, starting with slide four,the acquisition timeline. 

This is fairly self-explanatory, but I would like to go over it anyway. We released a Request for Proposals on August 29th. The vendors have asked for an extension to respond to that Request for 

Proposals. We granted that extension, and they now currently have 

until this Monday, September 15, to provide their proposals to us, 

their written proposals to us. 

The events that will occur following that are two things. First of 

all, we will have a technical evaluation team that will review the 

proposals themselves. Following that, we will allow oral presentation by the vendors themselves. Once those two actions are complete, the technical evaluation team will rate and rank the vendors, 

and the contracting officer will award the contract. Tentatively, we 

are looking at September 26 for that to occur right now. 

Once we have a contractor on board, the RFP that we have put 

on the street is implemented, and we have several milestones that 

provide us what we need in terms of implementing this program. 

Obviously, the first thing we will want from them is a draft project 

plan, within 10 days. By October 31, we expect the vendors to submit business requirements and process flows to VA. And I would 

like to clarify a little bit about what that is, because it is going to 

be a detailed technical comparison between what VA’s business requirements were articulated as in the RFP, and what the winning 

vendors’ proposed solution will be, and what will be needed to 

interface those two. For example, the technology that we have 

transmits data in certain ways, and provides gateways in certain 

ways, and we need to ensure that the handshakes to transmit that 

data will occur. Those type of things will be addressed under that 

business requirements submission. 

By March first, the vendors will have to demonstrate the capabilities of the system itself, and we will begin user testing. We do 

not anticipate that at that point the full system will be available 

for user testing but we do anticipate that segments of it will. So 

we will begin user testing at that point. On May 1, the solutions 

have to be available to begin making eligibility and entitlement decisions. At that point we do not expect the payment piece to be 

ready, but we do expect entitlement determinations to be able to 

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be made. That will give us the opportunity of running test records 

through, test data through, and ensuring that the tool generates 

the correct eligibility information. 

Soon after that, on June 1, we do expect the full payment piece 

to be available. At that point, the functionality needed for the entire system would be available, and we could begin testing the system end to end, and then of course as in the legislation, August 1st 

of 2009 is our go-live date. 

Slide six provides three basic bullets on the performance elements that we are requiring. And these performance elements are 

the same performance goals we have in our strategic plan as in the 

President’s budget. No more than 10 days to process original 

claims, no more than 7 days for supplemental claims, with 98 percent payment accuracy. 

The following several slides lay out two pieces of information, 

and these are taken bullet-for-bullet directly out of the RFP, the 

Request for Proposal. The first is the objectives, and the second is 

the mandatory tasks. Some of these things sound very simplistic, 

and they could sound like no-brainers, and in some respects they 

are. But we are looking at a legal document, and we do have to 

prescribe things verbatim that we will need for a legal basis. We 

would expect them to meet all objectives, obviously, but we do state 

those type of things in the objectives so that legally, there is no 

confusion about what we are looking for. So in the objectives we 

do ask for things like ‘‘the solution will meet all of our objectives 

and address interrelations.’’ Obviously, that is laid out in all of the 

document. That is why we provide detailed business requirements. 

But it is a formal legal piece of the document. 

Same with the following issues. Consulting with VA experts, obviously they will be required to interface with our folks on a technical level to ensure that data is talking and the interfaces are occurring. There are IT requirements in here, too, in terms of industry standards. For instance, objective three talks about using an 

XML standard. That is an industry standard for data transmission. 

That type of objective would not come as a surprise to anybody in 

the industry. But again, we are looking at a legal document, so it 

is prescribed in there. 

The rest of the objectives I can go through. I believe they are 

self-explanatory, but perhaps not. Yes? Which one was that, Congressman? 

Mr. FILNER. Number four. 

Mr. WILSON. Not later than March 1st of 2009, VA will determine if a solution meets post-9/11 GI Bill requirements. That ties 

to the March 1 deadline in our timeline, during which we will validate that the method that they use to do work and the information 

that we will be sending them and requiring back from them match. 

Mr. FILNER. What if it doesn’t? 

Mr. WILSON. Then we will have a series of backup plans that we 

will have to go to, depending on what the vendor solution is. Unfortunately, I cannot provide a lot of detail, because we do not know 

precisely what the vendor solution will be, and our contingency 

strategies are going to be based on what their solution will be, and 

how that relates to our existing strategies. 

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Mr. PEDIGO. Mr. Filner, if I might just add to that. We are going 

to be working closely with this contractor from the date that the 

contract is executed, until it is completed. And we are not going to 

wait until March 1 to take a first look at the system to make sure 

that all the data points are in there, that the interfaces are complete, and that everything works properly. There will be some testing that goes on as the system is being developed by the contractor, 

and that is just typical for the development of any information 

technology system. So it is not as though we are going to get to 

March 1 and all of a sudden, receive that system from the contractor, and start pushing the buttons that day to see if it works. 

We will have looked at it considerably before that point in time. 

Ms. HERSETH SANDLIN. If you do not mind, I think that the objectives and the mandatory tasks here in the PowerPoint are fairly 

self-explanatory. If Members have specific questions as they review 

them, they can pose them at that time, but I think there are a lot 

of other questions that need to be posed before we get to the specifics of the RFP. I would like to begin with the questioning now. 

Mr. Pedigo, you mentioned that this is—a secure IT strategy, is 

not anything new, this has been in the President’s budget for at 

least 2 years. This has been the VA’s intent, to have a rules-based 

engine; you are simply accelerating the strategy. 

What was the timetable for a strategy for the VA to move to a 

rules-based engine? If it was in the President’s budget over the last 

2 years, why has it not moved forward prior to this date? Did you 

always anticipate the need to use an outside vendor to help you 

move to that system? 

Mr. PEDIGO. Well, the plan actually has gotten off track a couple 

of times. As I said, it was originally in the fiscal year 2008 budget, 

and we did not do it, and it was in the 2009 budget—— 

Ms. HERSETH SANDLIN. Why did you not do it then? 

Mr. PEDIGO. I would ask Mr. Wilson to comment on the technical 

reasons why we did not do it then. 

Mr. Wilson. Our TEES initiative is a suite of applications, and 

the 2008 budget, and the 2009 budget as well, address the specific 

pieces that will be implemented in order to roll out the entire 

TEES strategy over a period of time. For example, in 2008, one of 

the initiatives that we completed was implementation of the 

WEAMS application, which is an online tool for school, understanding which schools and programs are approved. That would be 

one piece that would plug into the overall TEES strategy. The piece 

that we have not really done any work on is the rules-based core 

of what would be considered the TEES engine. 

Ms. HERSETH SANDLIN. What was your original timeframe before 

the Post-9/11 GI Bill was passed? What was the timeframe that 

you were working on internally to move to develop the rules-based 

engine? 

Mr. WILSON. I believe it was 2013 for full deployment of TEES. 

Ms. HERSETH SANDLIN. We are trying to move to full deployment 

4 years ahead of schedule? 

Mr. WILSON. We are hoping to get as much from the industry as 

we can in that period, yes. 

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Ms. HERSETH SANDLIN. Did you anticipate in that timeframe, to 

complete it by 2013? Did you anticipate in your plan the use of an 

outside vendor to help you develop the IT solution? 

Mr. WILSON. I am not as sure of the specifics on that, but what 

I would say is that the discussions that we had concerning the 

post-9/11 GI Bill internally, including with our IT staff, it was very 

clear to us that we internally did not have the capabilities of standing this up. 

Ms. HERSETH SANDLIN. What do you need internally to do so? 

Mr. WILSON. I cannot answer that question. I do not know the 

answer to it. I will have to provide an answer in writing. 

[The response was provided in the Post-Hearing Questions and 

Responses for the Record, which appears on p. 42.] 

Mr. PEDIGO. Madam Chairwoman, could I add something to 

Mr. Wilson’s response? 

Ms. HERSETH SANDLIN. Yes. 

Mr. PEDIGO. When we had the original plan in place, obviously, 

we did not know that we would get the Post-9/11 GI Bill. So initially, the plan was to build a rules-based system to overlay existing education programs. Then, when we started hearing that we 

might get a totally new program that we would have to administer, 

we put the brakes on further development of the TEES system, because we did not want to start down a road and invest money and 

time building out the TEES system into a rules-based system before we knew whether or not we would have a new GI Bill. 

And initially, we had given ourselves a generous amount of time 

to get it completed, by 2013. But when we saw the timeline on the 

new GI Bill, we realized that we were going to have to dramatically 

accelerate the process. And it is not at all unusual for VA or any 

element of Federal Government to use contractors for support to 

build an IT systems. In fact, I would venture to say that the majority of significant systems in VA and other agencies are built with 

substantial contractor support. So that part of our approach is 

probably not much different than what we would have utilized had 

we gone ahead with a full-blown TEES system. 

Ms. HERSETH SANDLIN. For the rules-based system, right? You 

did the 2008 piece of developing the TEES system internally. So it 

was more anticipating, in the timetable you had set for yourselves, 

year 2013, that moving to the rules-based engine may have required the use of an outside vendor. Is that—— 

Mr. PEDIGO. The 2008 and 2009 initiatives involve contractor 

support as well. 

Ms. HERSETH SANDLIN. They did? 

Mr. PEDIGO. Yes. 

Ms. HERSETH SANDLIN. Okay. Could you provide the Subcommittee, if you can, in writing more detail of the process you 

used, and the vendors you used for the 2008 and 2009 piece? 

Mr. PEDIGO. Yes. 

[The Subcommittee staff was subsequently briefed by the VA.] 

Ms. HERSETH SANDLIN. Okay. I will have additional questions. I 

will now defer to the Ranking Member, Mr. Boozman, for questions 

he has of the panel. 

Mr. BOOZMAN. Thank you, Madam Chair. 

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What percent of today’s education benefit claims require off-line 

processing because of complexity? 

Mr. WILSON. Could you repeat the question, please? 

Mr. BOOZMAN. What percent of today’s education benefit claims 

require off-line processing because of their complexity? 

Mr. WILSON. All of our claims, all of our original claims now are 

processed—I am not sure if I understand the term ‘‘off-line,’’ but all 

of our original claims are processed by humans right now. None are 

processed automated. About 10 percent of our supplemental claims 

are processed through an automated process. 

Mr. BOOZMAN. Can you explain why you chose a performancebased approach to acquiring a new IT system? 

Mr. WILSON. I could not. I would have to get—can you? 

Mr. PEDIGO. Mr. Boozman, one of the reasons we chose a performance-based approach is because that permits a Government 

agency to realize some of the best practices that are being used in 

the industry. I mean, the traditional Government procurement for 

an automated system is to provide a very detailed set of prescriptive language, basically a blueprint for how a contractor would develop every step of an automated system. And what we have found, 

based on experience, is that when we use that approach we sometimes do not get to take advantage of the best practices that are 

out there in the industry, because we channel potential contractors 

into a particular approach that does not allow them to utilize the 

full extent of the best practices that are out there. So the performance-based approach does allow us to do that by not being prescriptive, but by basically giving potential bidders some broad parameters and some basic rules, and asking them to give us a proposal 

that they think incorporates the best practices that are out there. 

And then we choose which one we want to go with. 

Mr. BOOZMAN. Along with that, we have been told that the Department of Education has a system that, an automated system 

that processes benefits, that works well. Are there any other applications in Government that you are aware of? Have we looked into 

other applications where they are doing similar things, that perhaps could be used? 

Mr. WILSON. We are aware of the Department of Education’s system. We have had discussions with them. Another similarity to 

what we are looking at would be, there are other claims benefit 

type things that are automated. For example, Medicare-Medicaid I 

understand has a significant rules engine type capability. 

Mr. BOOZMAN. It does make sense to try and look and learn from 

some of the other similar applications as to what is going on? 

One of the keys to successful application of IT will be the databases available to the rules-based system. A key data component 

will be the history of a member’s service, which will to a large extent determine the veteran’s benefits. How soon does DoD provide 

DD–214 information to the VA today, and how do they provide it? 

Mr. WILSON. The feed we receive from DoD is in essence realtime. Once the information gets to DMDC, the Defense Manpower 

Data Center, that information is fed to us. I believe it is nightly, 

is the run. I do not know specifically how long it takes to get from, 

perhaps, one of the service branches into DMDC, but the feed that 

we receive from DoD proper is a real-time feed. 

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Mr. BOOZMAN. What would you guess, though, is the timeframe? 

How long does it take to push the button? 

Mr. WILSON. I would venture to say that it would be no more 

than about 2 weeks in most situations, from separation. 

Mr. BOOZMAN. Thank you, Madam Chair. 

Ms. HERSETH SANDLIN. Thank you, Mr. Boozman. The Chairman 

of the full Committee has graciously deferred to Mr. Hall, who has 

to be on the floor in a few minutes for a statement. I recognize Mr. 

Hall for questions. 

Mr. HALL. Thank you, Madam Chair, and thank you, Chairman 

Filner. 

Just a couple of quick questions. When was the RFP expanded 

to four vendors? Or is it actually going to four vendors? 

Mr. WILSON. The RFP was provided to the four vendors on August 29. 

Mr. HALL. That is the first time it was provided to anybody? 

Mr. WILSON. No, that is not the first time it was provided to anybody. Originally, we had contacted OPM, and we had begun work 

under a different contracting vehicle called the Training and Management Assistance vehicle. And we had originally put out an RFP 

under that vehicle. 

Mr. HALL. And are any of the principals in the four vendors who 

are currently under consideration former secretaries or undersecretaries of the VA? 

Mr. PEDIGO. We do not have any information on that, at this 

point. 

Mr. HALL. Okay, thank you. What criteria are you using to pick 

them? And do these four have a past record doing work for the VA? 

Mr. WILSON. Could you repeat the question? 

Mr. HALL. What criteria are you using to pick from the four vendors, and have any of these four vendors any past record doing any 

work for the VA? 

Mr. WILSON. I am personally not aware of any work that they 

have done for VA. The formal evaluation criteria I am not familiar 

with, but there is a formal document that defines the evaluation 

criteria. 

Mr. HALL. Well, that is good to know. A year ago, the education 

call center, the 800 number, was contracted out to ‘‘free up employees to do cases.’’ It turned into a disaster, as has been described, 

bad for vets calling in and more work for employees since contractors could not answer the questions. As a result, the VA eventually 

brought the work back into the VA and it is now being done by 

Federal employees at the Muskogee Regional Office. 

The question is this. You contracted out the education division 

call center. What did your evaluation of the contractor’s performance show in terms of costs, quality, and timeliness? And how does 

the work being done in-house now compare with the work that was 

done by the vendor? 

Mr. WILSON. The temporary contract call-center that we had in 

place was for short-term duration, and it was specifically designed 

as such. I think we have been very candid with the Subcommittee 

concerning what we were hoping would have been better quality on 

some of the answers that were provided to the callers, and we regret that. However, the core issue that we were addressing with 

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the contract call center was a timeliness that we were delivering 

to veterans in terms of claims processing. That was what it was designed to address. 

At the time we implemented that call-center, we were processing 

original claims in 46 days. We had that contract in place for 

6 months. Within a year, we had cut that timeliness in half, to 

about 23 days, and we have continued to improve from there. So 

I believe it met the core intent of what we were trying to do, with 

reducing the call volume, because of the high volume of pending 

claims. Our current call volume is the lowest it has been in 6 years, 

and I would again attribute that to the fact that we were able to 

process a lot more claims. Veterans simply don’t need to call the 

way they use to find out where their check is. The current education call center in Muskogee is performing very well. They have 

about a 1 percent abandoned call rate. 

Mr. HALL. That is good. That is what we are all looking for. 

The solicitation describes extensive training that contract employees will need in privacy and in security, as well as substantive 

skills relating to education programs. How much time do you estimate between the time that the contract employee is brought on 

board, and when he or she will be fully trained in all these aspects, 

to do the job? 

Mr. WILSON. Contract employees will not be doing work commensurate with our adjudicators. So in terms of the training that they 

will be required to go through, it will be minimal. Again, what we 

are looking for is in essence a rules-based type process. We would 

not anticipate significant numbers of bodies, certainly not at the 

decisionmaking level. That will simply not be there. 

The work that could perhaps be done by the contractor would be 

administrative support work. For example, if documents are received in a hard copy format, we would expect a contractor to have 

those documents scanned into the system and available. That type 

of work. 

Mr. HALL. And that is also works that could be done by VA employees, I assume. 

Mr. WILSON. Yes, that is correct. 

Mr. HALL. We have, in our offices, as Congressman Snyder and 

I were talking about, we have Lockheed Martin computers, but we 

have people in our offices who actually work them and fix them 

even most of the time, unless they are too broken down for us to 

fix them. But you know, the data entry and the material that is 

entered into them for their use for our office is done in-house. So 

did you consider just buying the IT system, and having your employees do the data entry for the rules-based decisionmaking? 

Mr. WILSON. What we tried to do is give the contractors as much 

flexibility as possible to propose a solution. It could be that their 

solution calls for that. Again, we are not going to know until we 

know what the proposals are. 

Mr. HALL. Thank you, Madam Chair. 

Mr. PEDIGO. Mr. Hall, can I just add one thing to that? 

Our expectation, our—I guess you could say, if we could get the 

ideal rules-based system, and we think there is a chance that we 

could get that, the vast majority of cases will not require data 

entry. And that is because what we envision, if things go according 

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to our understanding of rules-based systems, is that a veteran 

would be able to go online when he or she wants to apply for the 

education benefits, key in, themselves, certain basic information; 

name, maybe Social Security or some other identifier information, 

and then send that. And it goes into the rules-based system. 

And that rules-based system then would pull information from 

different sources. It would pull some information from DoD on the 

service. It would pull perhaps some information from the U.S. Department of Education on institutions of higher learning. And all 

that information would be pulled and then run through the rules 

that have been built into that system. And our hope is that in most 

cases, in a very short period of time, maybe even less than a 

minute, that system will provide to that individual, while he or she 

is still online, with the result of their request. It might tell them 

that they have been approved for the education benefit and that 

the institution of higher learning that they wish to attend and that 

the course that they want to pursue has also been approved. And 

so that there might not be any need in many cases for any type 

of data entry. 

Ms. HERSETH SANDLIN. Thank you, Mr. Hall. Mr. Filner? 

Mr. FILNER. Thank you, Madam Chair. I would say that I do not 

have a lot of confidence that this is not going to be a disaster, just 

listening to what has been said. Usually, when contracting out is 

argued for, the argument is to save money. Now, you are not going 

to fire anybody, so it does not look like we are going to save any 

money. What is this going to cost us roughly, do you think? 

Mr. WILSON. The legislation provided $100 million. We are waiting for the proposals from the vendors, and evaluation criteria will 

include consideration of the cost proposals that they are submitting. 

Mr. FILNER. And this could go as high as $100 million? 

Mr. WILSON. I would not venture a guess. I was just articulating—— 

Mr. FILNER. So we have no idea what this is going to cost us, 

what we are getting here? Everything is—I just find this to be simply incredible. I mean, I have never heard an RFP go out with so 

little—you do not know what you are going to get. You do not know 

how much it is going to cost. You do not know what is going to happen if it fails. I mean, what are you getting us into here? 

Mr. PEDIGO. As I explained earlier, Mr. Filner, this is a different 

approach than is often used with Government contracting. And we 

think it is the best approach because we have a good chance here 

of getting the very best practices that exist in the private sector. 

And—— 

Mr. FILNER. How do you know? You just said you did not know 

how much it is going to cost. 

Mr. PEDIGO. Well, I said we had a chance of getting that. I do 

not know with certainty that we will, but I think there is a high 

likelihood that because of the competitive nature of the vendors out 

there who will be submitting bids, that they are going to try their 

best to come up with a better solution than their competitors. And 

we will evaluate those solutions. And then at that time we will 

make a decision as to which one is best, and we will implement 

that process. 

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Mr. FILNER. I do not know how you are going to make that decision with the kind of information you have been giving me. But, 

did I hear that you gave this to 10 vendors to begin with? I mean, 

this does not just go out on the web, this went out to 10 specific 

vendors? 

Mr. WILSON. No. 

Mr. FILNER. What did you say? 

Mr. WILSON. That is not correct. 

Mr. FILNER. What did you say? 

Mr. WILSON. The original Request for Proposals was put out 

under a contracting vehicle referred to as a Training and Management Assistance vehicle. I believe there are 32 industry vendors 

that are already approved under that vehicle, and it was offered to 

those 32 vendors. And based on the discussions and the involvement of our Office of Information and Technology, OI and T staff, 

our technology staff, that that represented the vast majority of the 

universe that would be capable of delivering this system. 

Mr. FILNER. So we do not know if the answer is out there on 

number 33, or number 80, or some little company in San Diego, 

California—in my district—that may have an answer, but they 

would not even get this—right? 

Mr. PEDIGO. You know, utilizing the approach that—— 

Mr. FILNER. If Halliburton gets this, you guys are in trouble. Do 

we know if Halliburton was on that list? 

Mr. PEDIGO. I am not aware that they are, or that they are not. 

Mr. FILNER. Who put together—this is your proposal, 165 pages 

as I count. Who put this together? 

Mr. PEDIGO. VA staff. 

Mr. FILNER. Did you go out to a contractor to put out this RFP? 

I mean, you guys have the expertise to put out this incredibly detailed proposal, and you do not have the expertise to do the job? 

Mr. PEDIGO. We have utilized expertise from various elements of 

VA, from our contracting experts to our general counsel—— 

Mr. FILNER. Which is what you could do for the—— 

Mr. PEDIGO [continuing]. The staff that is in the education program, and we had some—— 

Mr. FILNER. So you spend the whole last month putting this 

thing together? Instead of figuring out how you would do the job? 

By the way, I saw the timelines. What happens if we wait until 

March 1, 2009, to determine if the contractor meets the objectives, 

and what if it doesn’t? 

Have you ever heard of the Deep Water Program for the Air 

Force? We did this same thing. We gave out billions of dollars 

worth of RFP, and they were supposed to supply cutters and helicopters for the Air Force. And the whole thing failed. The cutters 

that they delivered fell apart because they were not strong enough. 

So there is a chance, a slight chance, that this might not work. 

What are you going to do then? 

Mr. PEDIGO. We are planning for the possibility that it could fail. 

Which means that we are putting together a contingency plan. 

Mr. FILNER. That means we are going to do it ourselves. 

Mr. PEDIGO. That means that we are going to do what a good 

business operation would do, and that is not put all your eggs in 

one basket—— 

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Mr. FILNER. I think a good contingency plan should be—— 

Mr. PEDIGO [continuing]. And to develop a contingency plan that 

we could implement just—— 

Mr. FILNER. Maybe the contingency plan should be the plan. I 

mean, why—if you have a contingency plan for non-use of contractors, why do we not just use that? 

Mr. PEDIGO. It will be available for use if we believe that—— 

Mr. FILNER. Can you give us the contingency plan, please? 

Mr. PEDIGO. Well, we have not fully developed a contingency 

plan. It is under development as we speak. 

Mr. FILNER. This is going to be a disaster, Madam Chair. 

Ms. HERSETH SANDLIN. Mr. Snyder, did you have questions for 

the panel? 

Mr. SNYDER. Thank you. 

Mr. Pedigo, you started out the way I—I wanted to ask—a veteran would go online, enter some fairly basic information. Is it your 

expectation that they could enter that information without knowing 

what school they may be interested in? Are they going to be able 

to—‘‘I just want to check my eligibility for benefits, enter that information,’’ and get that response back right away? 

Mr. PEDIGO. They would be able to submit the information without the school. What we could do at that point is determine that 

they would be eligible. 

Mr. SNYDER. Eligible. And then another part of it is, yeah, I 

could say, ‘‘Okay, I have been accepted at the University of Arkansas, is the University of Arkansas in the system?’’ And then you 

could—the system could check that and say, ‘‘Yes, the University 

of Arkansas, this program is eligible?’’ And then I suppose a third 

part of that would be, ‘‘I have been accepted,’’ and you hope to have 

it set up so that the program would directly interface with the University of Arkansas; is that correct? So that they could corroborate 

that ‘‘yes, you are accepted,’’ and set up a payment plan directly 

to the university? Is that—— 

Mr. WILSON. Correct. The final piece, the school would simply report to us the enrollment information for the veteran. 

Mr. SNYDER. Now, from the standpoint of the veteran, if I understand what you all are saying, I am going to go on this Web site. 

I assume it will say—may not even have the contractor’s name, 

just say the veteran’s, your eligibility for the GI Bill. You have 

talked about a secure location. Geography of that will be determined by the contractor; is that correct? You are not requiring 

them to be under a Federal building somewhere? 

Mr. WILSON. We are requiring them to be in the 50 States, or 

the District of Columbia. 

Mr. SNYDER. And so, as long as everything goes smoothly, everything is fine. If it comes back indeterminate or something like that, 

so what happens then? What will the veteran be told? Will the veteran be told, ‘‘Go to a different Web site,’’ or will it just say, ‘‘This 

is taking longer, your claim number such-and-such is going to be 

processed by a Veterans employee at this’’—are they going to be 

given some information of who to follow up with? 

Mr. WILSON. Yes. If the case would be rejected, for lack of a better term at this point, then we anticipate a notice being provided 

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to the veteran. And then at that point, that claim is going to go 

to a VA employee. And they would be contacting—— 

Mr. SNYDER. And they would—their follow-up at that point 

would no longer be through this Web site or this program. 

Mr. WILSON. Correct. 

Mr. SNYDER. They would know who they were supposed to follow 

up with? Either a name or a phone number or something? 

Mr. WILSON. Correct. we would develop in the same manner in 

which we do now. If we need to write a veteran for a specific piece 

of information, we would do so. 

Mr. SNYDER. Is it your anticipation that this will be the only way 

for a veteran to access GI Bill benefits, is online? 

Mr. WILSON. No. 

Mr. SNYDER. Okay. What specific challenges do you see out there 

with regard to Reserve component members? 

Mr. WILSON. I would not anticipate any specific challenges for 

them, in terms of ease of applying for the benefit. The will be entitled now to the same benefit as the active-duty members. 

Mr. SNYDER. The challenge is, right, your end of the contract? 

Mr. WILSON. The challenge from our end is ensuring that we 

have the most accurate, current data for the Guard and Reserve 

member. There are some specific exclusions for active service in 

this Bill that we have not had to account for before. We are working with DoD to receive that information. Additionally, since the 

Guard and Reserve members will be accruing perhaps more active 

service than they had when they initially applied for benefits, we 

will be required to constantly be receiving updated active-duty information from DoD, because the Guard and Reserve members especially could be in a situation where—for instance, when they first 

applied for benefits, they qualify at the 40 percent tier, because 

they have between 3 months of active duty and 6 months of active 

duty. If he or she goes on active service again, they will qualify at 

a higher tier. So the next time they go to school they will get 

more—— 

Mr. SNYDER. You had mentioned earlier about—I forget who 

asked the question about access to DD–214 information. You said 

about 2 weeks, or real-time. For a Reserve component member, are 

you going to have the ability to actually access military records? 

There is not going to be a transfer of data; correct? Their record 

will be an ongoing record. 

Mr. WILSON. We are working actively with DMDC on that issue 

right now. Our anticipation is that we will in fact have that data 

as part of our feed. 

Mr. SNYDER. My last question is—I was very supportive, as is I 

think everyone on this Committee, of the legislation. But we were 

aware it was put together pretty quickly. Sometimes in the spirit 

of getting something passed, it can move faster than you want it 

to, and I think there was great recognition there was an opportunity to pass this bill. Have you seen anything in the legislation, 

have you gone through it, that you wish Congress had done a bit 

differently, that might make your job a little easier? Or you see 

some glitches there? Or have you been in communication at all 

with the Committee about things that you see? I mean, things can 

certainly be fine-tuned. 

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I will put that another way, which is—if you cannot answer that, 

if you see those things I hope you will let us know, because we do 

not want to change things while you are in the midst of a contract 

proposal. On the other hand, sometimes improvements need to be 

made and hearing them from you might be helpful. 

Mr. WILSON. There are some technical issues that we think 

would clarify a lot of the points and make it easier to administer. 

We have been working with the Senate Veterans’ Affairs Committee staff along those lines, and I believe there is a technical 

amendment in the Senate right now. I do not believe that there is 

a companion legislation in the House. 

Mr. SNYDER. Maybe you could be in touch with our staff here 

also. 

Thank you, Madam Chair. 

Ms. HERSETH SANDLIN. Thank you, Dr. Snyder. 

Mr. Boozman, did you have additional questions you would like 

to pose at this time? 

Mr. BOOZMAN. No, I would just like to make a comment. The $100 million has come up, and the reality is that that was in the 

bill. It is not a VA request or VA’s doing. It was put in the Bill 

because as we went along, there was concern about the complexity 

of this thing, and I voted for the bill so I voted for the $100 million, 

as all of us did, okay? So again, that does not have anything to do 

with you all. So I do not think you should have to defend that. 

The other thing is that what I would like to do is see this thing 

move forward, and then look again as you formulate your plans. I 

do not think it is fair—and have not really decided where this 

thing ought to go, because I have not seen exactly what you are 

going to do. But I do not think it is fair to arbitrarily say that it 

is bad to not contract out. The Committee, my office, we do not do 

in-house, we do not take care of our computers. We have chosen to 

contract that out because we think that that is the best way to 

take the taxpayers’ money and utilize it most efficiently. In the 

sense we could hire a part-time veteran or a part-time person or 

whatever to do those functions, but we feel like that would be much 

more expensive than doing the route. 

So again, what I would like to do is go forward and kind of see 

where it goes. But I do think that the hearing today has been good. 

You have heard a lot of concern. You heard concern from the American Legion this morning about the direction that we were going. 

I really would like for you also—we are far enough along in the IT 

stage that there are other agencies I think that are doing similar 

functions. And I really would encourage your people to be visiting 

with them, to see how they have tackled some very complex similar 

things, to see if you could put some of their thoughts to work. 

And you know, again, I know you want to do it. I know that you 

all are working hard. I know you want to come up with a system 

that we can all be very proud of, and very efficient, that will service our veterans in the very best way that we can, and again, use 

our taxpayers’ money wisely. 

Mr. FILNER. Will the gentleman yield for 1 minute? 

Mr. BOOZMAN. Yes, sir. 

Mr. FILNER. You state a very important point, that contracting 

out is not a priori wrong. But we have to come to a judgment based 

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on the information of the people doing the job. And in the way VA 

answered the questions today, or did not answer the questions, I 

do not have the confidence that it is being done right. 

You say, ‘‘Well, I hope that it goes on and I hope that it comes 

out right.’’ You have to make a judgment from the information that 

you have. Just from the fact that this is a very complicated, as you 

stated, piece of the plan the original testimony only lasted 3 minutes to tell us what VA is doing. And then when you all complained, they put together the PowerPoint presentation. Does that 

give you confidence that this is being handled correctly? That does 

not give me confidence. That is all I have to say. 

I yield back. 

Mr. BOOZMAN. We are complaining today, again. Like I said, 

what I would like to do is just see the process. I would like to see 

the process go forward, and see what is to come. I mean, this is 

just the very, very start of the process. 

Mr. FILNER [continuing]. Tens or $100 million—— 

Mr. BOOZMAN. Well, again, though—— 

Mr. FILNER. I hope they will tell—can we make that, Madam 

Chair, a requirement that before they award any bid, we see what 

the bid is? 

Ms. HERSETH SANDLIN. We are going to have another hearing in 

a couple of weeks. It looks like it will be held about the time that 

you are looking to formally award the contract. So I think that it 

would be, understanding that there are certain things that you 

probably can and cannot share with the Committee in the contracting process, as soon as we get that hearing scheduled, we 

would appreciate working with you on your timeline during that 

same week or the following week, in making a decision on a final 

award, so that we can continue to get more information from you. 

Let me just state for the record that I have had concerns for a 

number of months now that this was going to be difficult to administer, and have repeatedly stated that the job of this Subcommittee, 

regardless of what the new GI Bill is going to be, was going to be 

an important one to make sure that it was implemented properly, 

effectively, and in a timely fashion. 

I appreciate, Mr. Pedigo, that you may have a chance to get the 

best system in place. I am worried about the timetable. You essentially wanted this same system by 2013, and you want to get a system in place that will work by 2009, by the middle of 2009. So, we 

are going to stay on top of this and keep asking questions. If we 

had not had this hearing today, if we had not been asking questions before this hearing, we were getting some information but not 

nearly the kind of information that I think the entire Congress 

needs, to make sure that a very important piece of legislation that 

we just passed and signed into law actually works for veterans the 

way we want it to. 

My question is, have you briefed anyone in the Senate, either formally, in a hearing before the Senate Veterans’ Affairs Committee, 

or any Member of the Senate, on your contracting plans? Or staff? 

Mr. PEDIGO. Well, there may have been some informal discussions with an isolated staff member. I have not been privy to that. 

But I can tell you there have been no formal briefings, and no formal discussions with Members on the Senate side. 

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Ms. HERSETH SANDLIN. Right. As I said to the American Legion 

earlier today, I want to reserve judgment on what you are doing 

here until we get more information, as we did today and will be 

over the next couple of weeks. inI share Chairman Filner’s concern, 

as it relates to what seems like a pretty quick decision to move to 

contracting, and yet contingency plans are yet under development. 

I think that it is important for the Subcommittee to understand 

what the discussions were at the VA after this law was implemented. 

Did you do any kind of cost-benefit analysis as to what this 

would take to administer on an accelerated timetable, with a rulesbased engine, getting an IT solution, versus hiring perhaps more 

employees to help administer the benefit, taking advantage of your 

in-house expertise? Looking at hiring opportunities of newly returned veterans that might have an interest in working in the VA 

in the Veterans Benefits Administration to help fellow veterans access their education benefits, and to work on a timetable of moving 

to your IT solution over a period of two, three, 4 years versus less 

than a year? What were the discussions in your office about those 

two options, and any kind of analysis that was done to look at the 

possibility of moving to this by August of next year? 

Mr. PEDIGO. You know, informally, with staff in VA, there was 

a lot of discussion, and you know, with the leadership, with my 

boss, the Under Secretary, the Acting Under Secretary, there was 

some discussion. And the Under Secretary and Secretary in the 

senior leadership of the VA, you know, considered, you know, the 

various options, and made the decision that the best approach 

would be to contract for a secure IT rules-based solution. 

And if I could, I just want to go back to a point I made earlier. 

You know, contracting for an IT solution is something that is done 

in Government all the time. That has become the norm for how we 

build information technology systems. So what we are doing is really consistent with what other agencies and other elements of the 

VA would do, if they had to build a complex system like we are 

building. 

Ms. HERSETH SANDLIN. Mr. Pedigo, I do not disagree. I think I 

heard your statement earlier in the week about what veterans 

might consider. Would they prefer a system that could process 

their claim in seconds or minutes, or 10 days to 2 weeks? Certainly 

with this new generation of veterans who are so IT-savvy themselves, they would prefer something that they could enter in and 

that they would know. 

I do not disagree with that. Here is my concern. You are trying 

to accelerate your own internal timetable of doing this by 2013, to 

doing it by 2009. As you have described to the Subcommittee today, 

it will be based on having to get information from the Department 

of Defense for information that is fed into the system. I have been 

in Congress for just over 4 years, and every time it seems when 

we have a problem of adequate and timely response to healthcare 

benefits, for people who are not yet medically discharged, or medically retired from service, the DD–214s that we have been hearing 

about in our field hearings, the memorandum of understanding 

that took years to get done with the DoD, and sharing healthcare 

information. 

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That is why I am going to invite the Department of Defense. 

They have ignored the last two field hearings we have had, to participate in our follow-up Subcommittee hearing in a couple of 

weeks, to see just how well they are working with you, cooperatively, to make sure that the information that they have for active 

duty and Reservists, as Dr. Snyder was pursuing, that the information is actually available to get into this feed, and get into this system, and workable by August of 2009. 

I think you can appreciate the skepticism that some of us have. 

Philosophically, I do not necessarily disagree about the importance 

of contracting for specific functions to help design software, to design a system, especially in IT. My concern is that you seem to 

have rushed to this judgment, and we have no contingency plan. 

I would respectfully request and ask for a time that you can give 

me, either Mr. Pedigo or Mr. Wilson, in which you can provide the 

Subcommittee the contingency plan. If your timetable here for seeing if the IT solution is working, we need to know what the contingency plan is, obviously before March 1 of next year. Preferably, I 

would like to see a contingency plan developed by the end of this 

month. Is that possible? 

Mr. PEDIGO. We believe that in order to really develop a fullblown contingency plan, that we need to see first what the solution 

is that the winning contractor is going to propose. So I would—— 

Ms. HERSETH SANDLIN. But will you not have that by the end of 

this month? 

Mr. PEDIGO. We should have that. We plan to award at the end 

of the month. And so at that point, we will know what the solution 

is, and we will need to put the finishing touches on the contingency 

plan that the Education Service has already begun developing. 

Ms. HERSETH SANDLIN. Mr. Wilson, you have already begun developing the contingency plan. When do you think you could provide the Subcommittee a contingency plan? 

Mr. WILSON. I would hope that within 30 to 45 days after award, 

we would have had enough specificity from the contractor, enough 

technical interaction, that we would have identified the major 

risks, and identified contingencies for those risks that point. 

Ms. HERSETH SANDLIN. But when I say ‘‘contingency plan,’’ and 

you are kind of tying it to what the contractors’ bids are going to 

look like and who you award it to; is the contingency plan going 

to be if they fail to meet certain targets? Or is the contingency plan 

going to be an entirely separate way of administering the benefits, 

should the rules-based engine not be fully developed? 

Mr. WILSON. I understand. The contingency plan could be exactly 

what you described, a separate independent method if all fails, 

worst-case scenario type situation, yes. And we are working on that 

fail-safe, for lack of a better term I guess. 

Ms. HERSETH SANDLIN. So you do not necessarily need to wait for 

the bid to be awarded before you can develop a plan? 

Mr. WILSON. That is correct, yes. Yes. 

Ms. HERSETH SANDLIN. Okay. So that is something you could get 

to the Subcommittee maybe before 30 to 45 days after the proposal 

is awarded? 

Mr. WILSON. Correct. 

Ms. HERSETH SANDLIN. Okay. 

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Mr. WILSON. If I may, Madam Chairwoman, just to add a little 

bit on to that. You know, once we see the proposed IT solution, I 

mean, our contingency plan could involve kind of a multifaceted 

plan, where we would say, you know, if there are five pieces to be— 

IT solutions being proposed, if piece ‘‘A’’ does not work by 6 months 

into the contract, but the other pieces are working, then we would 

need to go one way in terms of contingency plan. If piece one and 

three are not working, our contingency plan might be different because it is entirely possible that some portions of what the contractor would build for us will work perfectly well, and we could 

go ahead and utilize them but have to go to a contingency plan to 

support those functions that have not worked. 

Ms. HERSETH SANDLIN. I think I understand what you are saying. I know that Mr. Filner has. For example, if you have the contractor develop the rules-based engine and the trouble seems to be 

with processing reservist claims, maybe because you are not getting adequate information from the DoD. Just an example, to 

transferability issues—again, working with the DoD—you would 

have a contingency plan where VA employees—the only way to 

process those claims, then, would be through the system that exists 

now, or what you would set up in a contingency to hire an additional individuals to handle those claims? 

Mr. WILSON. Yes, yes. 

Ms. HERSETH SANDLIN. Mr. Filner? 

Mr. FILNER. Yes, just briefly. I hope you and Mr. Boozman, 

Madam Chair, will join me in a letter to the Secretary that asks 

the following: number one, he show us—there are four finalists, I 

understand? I do not know how we got there, but you have four finalists? Is that what I heard? 

Mr. PEDIGO. We have been advised by counsel that we should not 

discuss—— 

Mr. FILNER. All right, I want the letter to say that we want to 

see the original list of 32 or 33 bidders and the list of the bids of 

the finalists. I want to know who you have awarded the bid to before it is officially awarded and if that takes us meeting in Executive session to get that because you have been advised not to, you 

can give it to us in Executive session. I want to see all this stuff. 

Based on this performance here, I do not have confidence. So I 

want to see, again, the original list of 32. I want to see the finalists, if there are four, or eight, or 10. I want to see all the bids of 

those four or eight or 10, and I want to know who you are going 

to award the bid to before you award the bid. 

I hope you will join me in a letter to request this information. 

If we have to do that in Executive session, we should do it. We 

need more information, Madam Chair. We could pass a Sense of 

the House resolution and go forward. We could do that. I am prepared to do something like that. But we do not have the confidence 

that is needed here. VA is claiming, ‘‘we can’t give you this stuff.’’ 

Well, I do not trust them. And so if we have to do it in a secret 

session, we will do it in a secret session. But I hope you will join 

me in that. 

You have any problem with that information coming to us? 

Mr. PEDIGO. I am sure that when that letter gets to the Secretary, he will consider—— 

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Mr. FILNER. Do you have any problem with that, giving us that 

information in Executive session? 

Mr. PEDIGO. I will defer to the Secretary to respond to your letter 

that you plan to send. 

Mr. FILNER. Tell him what is coming. 

Thank you, Madam Chair. 

Ms. HERSETH SANDLIN. Mr. Boozman? 

Mr. BOOZMAN. The only comment that I would have, Madam 

Chair, is that we might consider maybe having—I share the Chairwoman’s concern with sometimes the lack of cooperation with DoD. 

But we might consider having perhaps a joint hearing with Personnel, and then ask them to have DoD and us ask, and have you 

guys, and really kind of hash out some of these potential problems. 

I think if working with the Personnel—it would be Personnel, 

would it not? Is that Ms. Davis? Yes. You know, working with 

them, and them sharing concern along with us, that that might be 

helpful in everybody working together. 

Ms. HERSETH SANDLIN. I appreciate that, Mr. Boozman. I think 

regardless of how things unfold from here, whether it is the perfect 

system that is developed in the IT solution, whether it is the contingency plan, or whether it is an entirely separate manner of implementing the bill, the legislation, the DoD sharing of information 

is going to be essential to any effective way for the VA to administer this new and complicated benefit. I appreciate the suggestion, 

and will look forward to having a joint hearing in that capacity. 

If I have additional questions I will submit them in writing. 

However, since we do plan to have a follow-up hearing in just a 

couple of weeks, we will have another opportunity to visit with you 

again. The Committee Counsel, working with your counsel, will 

hammer out what can be shared and in what setting, as it relates 

to the contracting process that you are seeking to complete within 

the next two to 3 weeks. We will work with you in good faith to 

meet the needs of the Committee, as well as respect the needs of 

the process that you have under way. 

We hope that you will understand why we want to get more information, to make sure that for our constituents that are entitled 

to this benefit, that by August of next year there are not problems 

in administering it. We appreciate the testimony and the information, but we also look forward to additional information that you 

will be presenting to us as soon as possible, and we will work closely with you to get it. Okay? 

Thank you, again, for answering our questions today. As Chairman Filner indicated, we do hope that Secretary Peake is willing 

to join us maybe at the next hearing, where certainly we will be 

asking questions as it relates to wanting to make sure he is fully 

informed of our concerns. We look forward to following up on the 

implementation status of the new public law. 

With that, the hearing now stands adjourned. 

[Whereupon, at 2:32 p.m., the Subcommittee was adjourned.] 

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(26) 

A P P E N D I X 

Prepared Statement of Hon. Stephanie Herseth Sandlin, Chairwoman, 

Subcommittee on Economic Opportunity 

I would like to take a moment to remember the lives lost on the morning of the 

September 11, 2001. As our country continues to heal from this tragic event of 9/ 

11, we must never forget that today we have thousands of troops serving honorably 

in Iraq and Afghanistan, many of which have served in multiple deployments overseas. I would like to express my sincere thanks and appreciation of our men and 

women in uniform who have answered the call to duty, and reinforce my commitment to serve them honorably as they continue to serve us all. 

Keeping this in mind, we must never forget that today’s servicemembers are tomorrow’s veterans who will require the resources to succeed in life after military 

service. To this end, this Subcommittee has held numerous hearings, here in Washington, DC and our Congressional districts, on programs critical to their continued 

success. One such program in which we were able to make significant progress is 

the Montgomery G.I. Bill. 

Public Law 110–252 will provide our veterans the educational entitlements needed to attend a college or university of their choice. Certainly, this landmark legislation makes significant improvements but we must remain vigilant to ensure Congressional intent is fully implemented and the Department of Veterans Affairs is afforded the resources to meet the needs mandated by Congress. 

Today’s hearing will give the Subcommittee the opportunity to better understand 

the VA’s implementation plan as required by Public Law 110–252. As many of you 

may be aware, there have been numerous concerns over the VA’s plan to contract 

out services, contracting transparency, and time constraints to implement the requirements of the newly enacted law. 

Last month we sent a letter inviting Secretary Peake to participate in today’s 

hearing. This letter specifically states that the purpose of today’s hearing was to 

have VA present its plan on implementing Chapter 33 with as much detail as possible. I am deeply disappointed by the testimony that was submitted and hope we 

can be properly informed about VA’s plan to meet Public Law 110–252. 

I look forward to working with Ranking Member Boozman and Members of this 

Subcommittee to provide oversight on the implementation of the new Montgomery 

G.I. Bill requirements. 

f 

Prepared Statement of Hon. John Boozman, Ranking Republican Member, 

Subcommittee on Economic Opportunity 

Good afternoon. First, let me concur with the Chair’s dissatisfaction with VA’s 

prepared testimony. I believe the invitation letter was sufficiently detailed regarding 

our expectations for today’s hearing. While I recognize VA may be constrained regarding competition sensitive information, describing the Department’s desires expressed in the Statement of Objectives provided to industry is well within their authority. I expect the Department to provide the Subcommittee with a very detailed 

briefing on those objectives and the winning bidder’s plan to meet them very shortly 

after contract award. 

It is both ironic and fitting that we are holding a hearing on the Post 9/11 GI 

Bill exactly 7 years after that cowardly attack on America, an event that contributed to today’s global conflict. 

The war on terror has highlighted the need to create a new GI Bill that reflects 

the increased obligations of today’s service members and their families. 

In addition to caring for our dead and wounded, there is no more important benefit to offer a path to personal growth through a generous education benefit. 

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As you may remember, the Subcommittee on Economic Opportunity, under Chairwoman Herseth Sandlin’s leadership, reported a GI Bill that I believe was superior 

in nearly every way to what eventually became law. Our bill, H.R. 5684, was simpler to administrate, was more flexible and offered $19,000 per year for full time 

enrollment. Our bill was eventually passed by the Full Committee but failed to 

make it to the floor. So we are here today to hear VA describe how they intend to 

implement the very complex program in chapter 33. 

Frankly, I am very concerned that despite VA’s best efforts, they will not meet 

the August 1, 2009 deadline. We are aware that VA intends to contract out a significant portion of the effort to bring the program online, but they now have less than 

11 months to get the work done. I hope we have not given them an insurmountable 

task. 

I am also aware there is some opposition to VA’s intent to contract out development of the new IT system and possibly some personnel issues. I would remind 

those who oppose using modern information technology to manage the system that 

it is the mot promising way to shorten the processing time. While a small number 

of cases may require manual intervention because of their complexity, the vast majority should lend themselves to automated processing. I am confident that if we 

asked veterans whether they would prefer the current method that now takes about 

20 days or an automated process that could provide an answer in minutes, they will 

choose the latter. I believe there is an example of this at the Department of Education and I will ask VA whether they have looked at that model. 

As to whether the IT should be developed in-house or via a contract, those who 

point to the failure of COREFLS should also remember that VETSNET is primarily 

an in-house project that has been in development since the late eighties and has 

experienced numerous failures and has cost the Government over $600 million. 

From reading VA’s testimony, there is ample opportunity for VA employees to remain employed in the education service or elsewhere within VBA. My point is that 

we have given VA a complex new program to manage and until their selected approach to implementing that program fails, we should not interfere. This should be 

about meeting the needs of veterans seeking an education, and no other agenda. 

Madam Chair, this Subcommittee worked hard for 4 years in a bipartisan way 

to do the right thing by those who have born the battle. If VA believes they need 

any additional legislation, I hope they will provide that to us in time for us to act. 

I look forward to hearing from the Department today and I hope their testimony 

will not only describe the major features of the proposed contract, but also provide 

a frank and candid assessment of the challenges they face. 

I yield back. 

f 

Prepared Statement of Keith Pedigo, Associate Deputy Under Secretary 

for Policy and Program Management, Veterans Benefits Administration, 

U.S. Department of Veterans Affairs 

Good afternoon Chairwoman Herseth Sandlin, Ranking Member Boozman, and 

Members of the Subcommittee. I appreciate the opportunity to appear before you 

today to discuss the Department of Veterans Affairs (VA) strategy for implementation of the Post-9/11 GI Bill (chapter 33 of title 38, United States Code). Accompanying me today is Mr. Keith Wilson, Director, Education Service. My testimony 

will highlight the staffing and information technology solutions being pursued by 

VA. I will also discuss outreach efforts related to this new education benefit. 

The Post-9/11 GI Bill program will provide veterans, servicemembers, and members of the National Guard and Selected Reserve with educational assistance, generally in the form of tuition and fees, a monthly housing allowance, and a books 

and supplies stipend, to assist them in reaching their educational or vocational 

goals. The Post-9/11 GI Bill program will also assist in the readjustment to civilian 

life, support the armed services recruitment and retention efforts, and enhance the 

Nation’s competitiveness through the development of a more highly educated and 

productive workforce. 

Chapter 33 Implementation Strategy 

Our strategy to implement the Post-9/11 GI Bill relies on contractor support to 

buildupon and accelerate what we had developed as our longer term strategy to employ rules-based, industry standard, technologies in the delivery of education benefits. Many of our education programs contain eligibility rules and benefit determinations that would work well with rules-based technology that requires minimal 

human intervention. The goal of minimizing human intervention through the elecjbell on PROD1PC69 with HEARING

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tronic processing of applications and enrollment information was outlined in the 

President’s FY 2009 Budget Submission. It is important to understand that the contractor will not have full responsibility over the administration of the Post-9/11 GI 

Bill. Instead, the contractor will be responsible for development of the information 

technology (IT) solution, and general administrative or data entry functions. Claims 

that are rejected by the automated process and require a manual eligibility determination will remain the responsibility of trained VA personnel. The contractor’s 

mission is to support VA in its implementation of the Post-9/11 GI Bill by developing a secure solution so that VA can meet the statutory requirements of the new 

educational assistance program. 

We plan to award a contract for this support in the very near future. The contractor will be accountable for providing timely and accurate education claims processing by completing original claims within 10 days, supplemental claims within 7 

days, and achieving a 98 percent accuracy rate. The technological solution and services provided will be under the close direction and oversight of Veterans Benefits 

Administration (VBA) employees. VA’s solicitation for a contractor has established 

June 1, 2009, as the deadline for the contractor to demonstrate functionality of the 

IT solution. 

Additionally, since the enactment of the Post-9/11 GI Bill, Education Service has 

been working with system developers from the VA Office of Information and Technology, as well as our Office of Business Process Integration, to enhance key existing VA IT systems. For example, VA–ONCE, an application that allows school certifying officials to transmit enrollment data electronically to VA, is being modified to 

accommodate the reporting requirements of the new program. Further, Education 

Service is working closely with elements within the Department of Defense, including the Defense Manpower Data Center, to establish data requirements and procedures for implementation of the transferability provisions of the Post-9/11 GI Bill 

program. 

Our goal is to transition servicemembers and veterans into the new Post-9/11 GI 

Bill with no disruption in the payment of education benefits in accordance with the 

August 1, 2009, effective date for the new program. 

Based on the implementation strategies being pursued, VA does not anticipate the 

loss of Federal employment for any present employees associated with VA’s Education programs. Since the Post-9/11 GI Bill will result in tuition and fee payments 

being made directly to educational institutions, some current claims processing resources will be shifted to increased compliance and oversight responsibilities. 

VA employees will continue to staff and operate our Nationwide customer call center in Muskogee. VA employees will also continue to respond to all on­line inquiries received through the VA Web site, including Post-9/11 GI Bill inquiries. 

Regulations 

The provisions of the Post-9/11 GI Bill require VA to develop rules and regulations to administer the new program. Education Service is actively engaged in the 

process of developing the required regulations, and we anticipate publishing the program’s final regulations in the Federal Register by May 2009. 

Outreach 

The VA’s GI Bill Web site was updated to include information regarding the Post9/11 GI Bill within hours of the law’s enactment. To date, over 3,500 individuals 

have signed up to receive automatically generated e-mails from VA whenever information about the Post-9/11 GI Bill is updated on the Web site, and over a quarter 

million have viewed the Post-9/11 GI Bill ‘‘frequently asked questions.’’ In addition 

to web-based outreach, Education Service is preparing posters, pamphlets and direct 

mailings to veterans, servicemembers, and college and university Executives. In late 

2008, VA will launch a multimedia advertising campaign in an effort to reach individuals who may have dropped from our direct mailing rolls. These are individuals 

who have left the military and have not used VA benefits or have relocated since 

last using VA benefits. 

Madam Chairwoman, this concludes my statement. I would be pleased to answer 

any questions you or any of the other Members of the Subcommittee may have. 

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[TEXT VERSION OF VA SLIDE PRESENTATION] 

Chapter 33 Implementation Overview 

Presented to the House Veterans’ Affairs Committee, Subcommittee on 

Economic Opportunity 

Introduction 

• The strategy to implement chapter 33 builds upon and accelerates the pre-existing strategy to employ rules based technology for eligibility determinations and 

claims processing. 

• Vendor support will be utilized to ensure that the legislatively mandated August 1, 2009 deadline is met. 

• Precise strategy dependent on winning vendor’s solution. 

• VA employees will continue to process other education benefits and will have 

a role in chapter 33 processing. 

• No VA staff will lose Federal employment as a result of implementation of the 

Post-9/11 GI Bill. 

• VBA has a longstanding history of managing change without negatively 

impacting employees. 

• VA anticipates shifting some resources from claims processing to increased oversight functions. 

• Claims decisions will continue to be made by VA staff. 

• Rules engine criteria defined and controlled by VA will automatically adjudicate the majority of claims received. 

• ‘‘Rejected’’ claims adjudicated individually by VA. 

Acquisition Timeline 

8/29/08 VA released request for proposal to vendors. 

9/15/08 Deadline for vendor responses to VA’s request for proposal. 

9/16/08 VA proposal evaluation team begins initial review of vendor 

written proposals. 

9/22–9/23/08 Vendors present oral presentations to VA proposal evaluation team. 

9/26/08 (tent) Chapter 33 contract formally awarded to selected vendor. 

Project Milestones 

Within 10 days of contract award Vendor submits Draft Project Management Plan to VA. 

10/31/2008 Vendor submits Business Requirements and Process Flows 

to VA. 

3/1/2009 Vendor demonstrates solution capabilities to VA. User testing begins. 

5/1/2009 Solution must be available to begin making eligibility and 

entitlement decisions. 

6/1/2009 Solution must be available to make full benefits awards, 

payments, accounting, and all other required 

functionalities. 

No later than 8/1/2009 Solution must be certified and fully operational. 

Vendor Performance Metrics 

• Process original claims in 10 days or less. 

• Process supplemental claims in 7 days or less. 

• Achieve at least 98 percent accuracy. 

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RFP Objectives 

1. Solution shall meet all requirements in all objectives and address interrelations. 

2. Consult with VA subject-matter experts to develop business requirements and 

process flows. 

3. Data transmissions between solution and VA must use XML standards and be 

bi-directional. 

4. NLT 3/1/2009 VA will determine if the solution meets Post-9/11 GI Bill requirements. 

5. Meet requirements according to section E authorities including adhering to finance standards and regs, adhering to moderate system sensitivity categorization, ensure privacy is maintained, and meet all testing capabilities. 

6. Support both paper and electronic submission of claims and check processing, 

and provide online access to VA and stakeholders. 

7. Demonstrate capability to manage and control change. Ensure services delivered employ technology that is effective and scalable. 

8. Establish and maintain a support capability that adheres to industry best practices. 

9. Adhere to the following performance requirements: 10 days or less to complete 

original claims, 7 days or less to complete supplemental claims, 98 percent administrative and payment accuracy rate. 

RFP Mandatory Tasks 

1. Detailed Project Management Plan. 

2. Develop business requirements and detailed process flows. 

3. Provide a secure solution in accordance with the objectives. 

4. Host the Post-9/11 GI Bill solution in a secure facility. 

5. Demonstrate an acceptable process that clearly articulates inputs and outputs 

of solution. 

6. Work with Federal oversight entities and VA’s OCIS staff to remediate any security issues identified in reviews. 

7. Propose enhancements that improve efficiency and effectives of secure solution 

and meet evolving needs of VA. 

8. Propose industry standard best practices for training and other adoption requirements. 

9. Upon termination of the contract, the vendor shall comply with the Continuity 

of Services provisions in FAR 52.237–3. 

VA Responsibilities 

• Control authorization of benefits and payments through established rules for 

the system and human intervention when automatic processing is not possible 

• Provide oversight of the work being accomplished through the vendor’s secure 

solution 

• Ensure that performance metrics are being met 

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MATERIAL SUBMITTED FOR THE RECORD 

Committee on Veterans’ Affairs 

Subcommittee on Economic Opportunity 

Washington, DC 

December 8, 2008 

Hon. James B. Peake, M.D. 

Secretary, 

U.S. Department of Veterans Affairs 

810 Vermont Ave., NW 

Washington, DC 20420 

Dear Secretary Peake: 

I am sending you a deliverable in reference to our House Committee on Veterans’ 

Affairs Subcommittee on Economic Opportunity Hearing on ‘‘Oversight of GI Bill 

Implementation’’ on September 11, 2008. Please answer the enclosed hearing questions by no later then Tuesday, January 13, 2009. 

In an effort to reduce printing costs, the Committee on Veterans’ Affairs, in cooperation with the Joint Committee on Printing, is implementing some formatting 

changes for material for all full committee and subcommittee hearings. Therefore, 

it would be appreciated if you could provide your answers consecutively on letter 

size paper, single-spaced. In addition, please restate the question in its entirety before the answer. 

Due to the delay in receiving mail, please provide your response to Ms. Orfa 

Torres at by fax at (202) 225–2034. If you have any questions, please call (202) 226– 

4150. 

Sincerely, 

Stephanie Herseth Sandlin 

Chairwoman 

VA Response to Chairwoman Sandlin’s Letter 

December 8, 2008 

VA’s original IT plan (prior to enactment of P.L. 110–252) included the development of a rules-based engine to be fully deployed by 2013. In our hearing, Mr. Keith 

Wilson mentioned that the VA’s IT staff did not have the capabilities to standing 

up a rules-based system. What do you need internally to do so? 

Congressional Inquiry 

Date: January 5, 2009 

Source: Cliff Britton, Office of Information and Technology (OIT) 

Inquiry from: Representative Stephanie Sandlin, Chairwoman, House Committee 

on Veterans’ Affairs Subcommittee on Economic Opportunity 

Context of inquiry: 

Chairwoman Sandlin sent a letter to Secretary Peake on December 8, 2008, requesting VA respond to a question related to a hearing her Subcommittee held on 

September 11, 2008, related to ‘‘Oversight of G.I. Bill Implementation.’’ 

The Subcommittee understood Mr. Wilson’s testimony to be that the Department 

of Veterans Affairs does not have the capability to stand up a rules-based system 

and wants to know what VA needs internally to have that capability. The testimony 

was misunderstood. VA has the capability through its relationship with SPAWAR. 

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VA Response (OIT) 

Mr. Keith Wilson’s testimony meant to convey that the Department of Veterans 

Affairs (VA) did not have the resources to support developing and deploying a rulesbased system in time to meet the legislative requirement to pay Chapter 33 benefits 

by August 1, 2009. VA is working with the Space and Naval Warfare Systems Command (SPAWAR), in Charleston, South Carolina, to design, develop and deploy a 

rules-based solution as part of the Post 9/11 G.I. Bill long-term solution. The VA 

plans to deploy this rules-based solution in November 2010. 

VA Office of Enterprise Development Program Offices: Kai Miller 

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