Veterans' Employment and Training Service: Preliminary Observations on Changes to Veterans' Employment Programs
Published: 2005-05-12T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: The Department of Labor's Veterans' Employment and Training Service (VETS) administers two programs designed to assist the roughly 700,000 veterans who are unemployed in any given month. These two programs, the Disabled Veterans' Outreach Program (DVOP) and the Local Veterans' Employment Representative (LVER) program, fund employment, training, and job placement services to veterans. In 2002, Congress passed the Jobs for Veterans Act (JVA), which redefined the roles of DVOP and LVER staff and required that VETS establish a new performance accountability system. This testimony is based on GAO's ongoing work in this area and focuses on three aspects: (1) the separation of DVOP's and LVER's roles and responsibilities; (2) VETS' performance accountability system for DVOP and LVER staff; and (3) VETS' system for monitoring DVOP and LVER performance.
section_title: What GAO Found
paragraphs: VETS has established separate roles for DVOP and LVER staff and has provided policy guidance and training to states explaining these changes. Under JVA, states now determine how many DVOP and LVER staff they hire, where to place them within the local workforce areas, and 23 states are planning to use some part-time DVOP staff. There are indications that integrating DVOP and LVER staff into the local workforce offices remains challenging. While VETS has issued guidance on an incentive program to encourage improved performance, state implementation of the program has varied, and 11 states do not plan to participate. VETS has implemented employment measures for DVOP and LVER staff, but a minimum standard that all states must meet for veterans entering employment will not be available before 2007. VETS reported meeting Labor's goal of achieving a 58-percent employment rate for all veteran job seekers during program year 2003, but fell somewhat short of reaching a 60-percent employment goal for disabled veterans. Assessing how well DVOP and LVER programs are serving veterans may continue to be difficult due to ongoing concerns about data reliability. VETS implemented a monitoring system in program year 2004 that relies primarily on state self-assessments of performance in conjunction with onsite reviews. It is unclear, however, how VETS staff at the state, regional, and national levels will use this information consistently to guide or improve the DVOP and LVER programs. VETS is working with other Labor agencies to coordinate monitoring and enforcement efforts.

section_title: Letter
paragraphs: I am pleased to be here today to talk about our preliminary observations  on the status of implementation of some key provisions of the Jobs for  Veterans Act (JVA).  This legislation was passed in 2002 to improve  various aspects of employment, training, and placement services provided  to veterans.  The need for such services is growing, given that roughly  700,000 veterans are unemployed in any given month and the number of  service members leaving active duty—estimated by the Department of  Labor (Labor) at 200,000 yearly—is anticipated to rise with more troops  returning to civilian life.  Viewing employment services for veterans as a  national responsibility, Congress established the Veterans’ Employment  and Training Service (VETS) within Labor to carry out national policy that  veterans receive priority in employment and training opportunities.
Among the programs that VETS administers as part of its responsibilities  to help veterans find employment are the Disabled Veterans’ Outreach  Program (DVOP) and the Local Veterans’ Employment Representative  (LVER) program.  Nationwide, there are more than 2,000 DVOP and LVER  staff.  The DVOP staff are responsible for providing outreach to veterans  needing VETS employment services and in offering them a variety of  intensive services, such as career guidance and provision of job  development contacts.  The DVOP staff are to give priority of service to  veterans who are disabled.  The LVER staff are focused on establishing  relationships with area employers and on facilitating employment,  training, and placement services for veterans.  The DVOP and LVER staff  are also mandatory partners in the one-stop center system created in 1998  by the Workforce Investment Act (WIA) where services provided by  numerous employment and training programs are made available through  a single network.
My testimony today addresses the current implementation status of three  aspects of the DVOP and LVER programs that have changed as a result of  JVA:  (1) The separation of DVOP’s and LVER’s roles and responsibilities;  (2) VETS performance accountability system for DVOP and LVER staff;  and (3) VETS system for monitoring DVOP and LVER performance.  My  testimony is based on our past reports and ongoing work for this  subcommittee and other congressional committees.  We will report on our  ongoing work at the end of the year, as mandated.
We recently held discussions with national and regional VETS officials and  visited two judgmentally selected states, Washington and Colorado.  In  Colorado, we interviewed state VETS officials, and visited the National  Veterans’ Training Institute (NVTI) where we interviewed NVTI officials as  well as DVOP and LVER staff from 24 states who were attending training  classes.  We also met with officials from various veterans’ service  organizations and the National Association of State Workforce Agencies.   We started this work in January 2005, and it is ongoing.  Our work is being  conducted in accordance with generally accepted government auditing  standards.
In summary, VETS has established newly defined roles for DVOP and  LVER staff and has provided this information by issuing policy guidance  letters and conducting ongoing training at NVTI.  States have been using  the flexibility that these programs now provide, such as being able to  determine how many DVOP and LVER staff are sufficient to meet their  needs, where to place them within the local workforce area, and how to  more effectively use them to serve local veteran job seekers.  Almost half  of the states plan to use JVA’s authority to assign DVOP staff on a part- time basis.  However, integrating DVOP and LVER staff into one-stop  centers remains a long-standing challenge.  While VETS has issued  guidance on the new incentive program to recognize exemplary service  delivery by DVOPs and LVER staff, 11 states do not plan to participate due  to reasons such as state laws or other policies that prevent individuals  from receiving awards.
VETS has implemented employment measures for DVOP and LVER staff.   However, VETS estimated that it will be at least until 2007 before it has the  trend data needed to establish the minimum standard that all states must  meet for the rate at which veterans enter employment.  Using goals  negotiated with the states in the interim, VETS reported that DVOP and  LVER programs, as a whole, met Labor’s goal of achieving a 58-percent  employment rate for all veteran job seekers during program year 2003,  although the programs fell somewhat short in reaching a 60-percent  employment goal for disabled veterans.  However, assessing how well  DVOP and LVER programs are serving veterans may continue to be  difficult due to VETS’ ongoing concerns about the reliability of service- related data.
VETS has implemented changes to its system for monitoring state  compliance with the DVOP and LVER programs, and work continues to  determine how best to use the monitoring information to improve program  performance.  VETS staff completed their first round of reviewing state  plans and self-assessments of performance in program year 2004.  In  addition, VETS staff performed their first round of on-site reviews.  It is  unclear, however, how VETS staff at the state, regional, and national levels  will use this information to consistently guide or improve the DVOP and  LVER programs.  VETS and the Employment and Training Administration  (ETA) are working together to coordinate monitoring and enforcement  efforts.
subsections: section_title: Background
paragraphs: VETS administers national programs to (1) ensure that veterans receive  priority in employment and training opportunities from the employment  service; (2) assist veterans, reservists, and National Guard members in  securing employment; and (3) protect veterans’ employment rights and  benefits.  VETS carries out its responsibilities through a nationwide  network that includes representation in each of Labor’s 10 regions and  staff in each state.  The Office of the Assistant Secretary for VETS  administers the agency’s activities through regional administrators and a  VETS director in each state.  The state VETS directors are the link  between VETS and the states’ employment service system, to whom the  DVOP and LVER staff--as state employees--directly report, and which is  overseen by Labor’s ETA.  In fiscal year 2005, VETS requested $220.6  million for all its programs, including $162.4 million for the DVOP and  LVER programs.  States plan to use this funding to support more than  2,100 DVOP and LVER positions.
In September 2001, we identified some key areas in which VETS could  better serve its clients by providing more flexibility and accountability in  its programs.  With its passage in November 2002, JVA amended the  legislation that governs the DVOP and LVER programs by addressing many  of the concerns we raised in our prior work.  For example, JVA clarified  the roles of DVOP and LVER staff, and gave states greater flexibility in  determining how the staff are used.  Under VETS guidance, the DVOP  staff’s duties now focus on providing intensive services--with priority given  to disabled veterans--including assessing the veterans’ special needs and  skills, developing a plan of action, and coordinating any needed supportive  services, such as training and job referrals.  The DVOP staff also provide  outreach activities to locate candidates who could benefit from intensive  services, such as homeless veterans.  As stated in VETS guidance, the  LVER staff’s duties now include developing regular contact with  employers to promote employment and training for veterans, developing  relationships with community leaders to further promote veterans’  employment, and promoting and monitoring the participation of veterans  in federally funded programs.
The JVA legislation required states to develop plans that include details of  the specific duties required of the DVOP and LVER positions and the  strategy for their integration into the one-stop system.  The legislation also  required the establishment of a comprehensive performance  accountability system to measure performance of the DVOP and LVER  staff, using performance measures consistent with those of WIA.  In  addition, JVA established an incentive program to recognize eligible  employees for excellence in providing veterans services and to encourage  the improvement of services, with 1 percent of each state’s annual grant  allocation to be designated for incentive funding.  In addition, JVA  required VETS to establish a minimum standard for the rate at which  veterans enter employment, a standard which all states are required to  meet.  The JVA legislation further required annual performance reviews of  veterans’ services, which VETS uses to monitor the DVOP and LVER  programs to ensure proper accountability.
section_title: VETS Has Implemented Changes to DVOP and LVER Roles and Responsibilities, but One-Stop Integration Issues Remain
paragraphs: VETS has taken action to implement the changes to the DVOP and LVER  programs.  VETS has issued policy guidance and conducted training on the  DVOP and LVER staff’s new roles and responsibilities.  In addition, nearly  half the states are taking advantage of JVA’s flexibility to employ part-time  DVOP staff.  Although VETS has issued guidance on the performance  incentive program to recognize exemplary staff as required by JVA, states  have implemented this program differently, and 11 states do not plan to  implement the incentive program because sometimes it conflicts with the  state’s policy if awards are given to individuals.  In addition, integrating  DVOP and LVER staff into one-stop centers continues to be challenging.
subsections: section_title: VETS Has Provided Guidance and Training to Distinguish DVOP from LVER Staff Duties and Many States Plan to Use Part-Time DVOP Staff
paragraphs: Through its policy guidance letters, VETS has clarified the DVOP and  LVER staff’s new functions, along with new staffing and reporting  requirements, including the use of part-time positions for DVOPs.  In  addition, shortly after JVA was enacted, NVTI held a series of  implementation seminars covering DVOP and LVER staff’s new roles and  responsibilities that were attended by representatives from all states.   NVTI also conducts case management training aimed at DVOP staff.  At  the end of its first training year in October 2004 following passage of JVA,  NVTI reported training 282 DVOPs and estimated that an additional 144  would be trained each year in the future.  Similarly, NVTI conducts  employer outreach training focused on LVERs.  Because this class is new,  NVTI estimates that it will train 264 LVERs by October 2005, and projects  that an additional 240 LVERs would be trained each year.
One of the key changes in the new law gives states the flexibility to  establish part-time DVOP and LVER positions, though this was already  permitted to some extent for LVERs.  According to their fiscal year 2005  state plans, 23 states planned to use the new flexibility under JVA to  employ both full- and part-time DVOPs, while 34 states planned to use the  long-standing authority to employ both full- and part-time LVERs.  As  shown in table 1, part-time DVOP positions would comprise about 18  percent of the total DVOP staff and about 44 percent of the total LVER  staff.
Some states plan to use part-time DVOPs and LVERs extensively.  For  example, two states, Maine and Washington, planned to use part-time  LVERs exclusively.  In addition, South Dakota plans on having 87 percent  of its DVOPs be part-time, and Vermont plans to have 91 percent of LVERs  be part-time.  By contrast, in New Jersey, only 5 percent of DVOPs are to  be part-time and, in Indiana, 6 percent of LVERs are to be part-time.
section_title: Not All States Plan to Use Incentive Awards
paragraphs: VETS has implemented JVA’s requirement to establish a performance  incentive awards program by issuing policy guidance that lays out criteria  and monetary as well as nonmonetary awards for states to consider in  developing an awards program.  According to fiscal year 2005 state plans,  11 states did not plan to use the incentive program due to reasons such as  conflicts with state law or other policies if the awards are given to  individuals.  The remaining 40 states planned to implement the incentive  program in various ways.  For example, in one state, two DVOPs were  awarded a one-time maximum award of $1,000.  In another state, however,  top performing DVOP and LVER staff were given a one-time cash award  for as little as $16.  Regardless of their current approach to implementing  incentives, some VETS officials said they would like to see award  eligibility criteria expanded beyond individuals to include entire units.
section_title: Challenges Continue with Integrating DVOP and LVER Staff into One-Stop Centers
paragraphs: Labor officials acknowledge that integration of DVOP and LVER staff into  the one-stop centers has been a persistent challenge.  The extent that  implementing changes under JVA will assist in breaking down the barriers  and entrenched cultures that have precluded integration in the one-stop  centers will likely take years.  According to the DVOP and LVER staff we  interviewed, integration still varied widely among local areas, depending  on the level of support provided by the one-stop manager for the DVOP  and LVER programs.  For example, one DVOP staff told us that the  veterans program is highly integrated with the WIA program in her local  one-stop, with both sharing case management responsibilities.  In addition,  she participates in regular meetings with the one-stop partners and  attributed this cohesion to the commitment by her one-stop manager to  work cooperatively with all the partners.  In contrast, a DVOP from  another state told us that he was assigned to tasks that prevented him  from serving as many veterans as he would have liked.
In cases where there was poor integration, several reasons were cited by  DVOP and LVER staff we interviewed from various states.  One reason  was that other one-stop staff were not educated or trained on serving  veterans.  An NVTI official told us that the institute has provided training  to states that have requested it, but was concerned that the states that  were struggling with providing veterans’ services were the very ones that  did not request training.  Other reasons included the perception among  DVOP and LVER staff we interviewed that there is little coordination  between VETS and ETA to ensure integration among all partner programs,  adopt uniform definitions of eligible veterans, and consistently give  veterans priority of service regardless of program.
section_title: New Performance System Implemented for DVOPs and LVERs, but Too Early to Link Changes to Veterans’ Employment Outcomes
paragraphs: VETS has implemented some JVA changes to the accountability system  related to the measures used for assessing DVOP and LVER performance,  but it estimates that it will be at least 2007 before it can implement a  minimum standard for veterans entering employment that all states will be  expected to meet.  Until the standard becomes available, VETS has used  historically based outcomes in negotiating performance goals with states.   In addition, Labor has established an entered-employment goal of 58  percent for veterans served through the DVOP and LVER programs.  While  VETS reported that the DVOP and LVER programs met Labor’s program  year 2003 goals for some measures, concerns about data reliability remain,  preventing an accurate assessment of how well DVOP and LVER staff are  performing.
subsections: section_title: Performance Measures Implemented, but More Time Needed to Establish Minimum Standard
paragraphs: The performance measurement system for the DVOP and LVER programs  has been in transition over the last several years.  Prior to JVA,  performance measures placed more emphasis on process-oriented  measures—measures that simply tracked services provided to veterans,  not on the employment outcomes veterans achieved.  In addition, states  used different data sources to report employment-related outcomes,  resulting in performance that was not comparable across states.    According to VETS officials, VETS adopted performance measures,  beginning July 1, 2003, that are consistent with those of WIA, but has not  yet specified when it will implement a system for weighting the measures  to provide special consideration for such groups as disabled veterans, in  accordance with JVA’s requirements.  Another fundamental change was  the use of Unemployment Insurance (UI) wage records to identify veterans  who get jobs rather than the use of time-consuming follow-up procedures.   The current performance standards for the DVOP and LVER programs  apply to various veterans populations, including disabled veterans.  Three  measures are based on WIA:  (1) veterans that entered employment; (2)  retention in employment at 6 months; and (3) job seeker satisfaction.   In  addition, VETS tracks entered employment following receipt of staff- assisted services and entered employment following receipt of case  management.
VETS officials told us, however, that the measures will change again on  July 1, 2005, when VETS will adopt the Office of Management and Budget’s  new common measures.  VETS will retain several existing measures that  track employment following services provided by DVOP and LVER staff.    While the new common measures afford some advantages over existing  measures, the frequent shifts in focus have made it difficult to collect  comparable data that can be used to establish a pattern of performance for  the DVOP and LVER programs and compare outcomes across different  time periods.  As such, VETS anticipates that it will take at least until 2007  to collect the necessary trend data to establish the minimum standard for  the entered-employment rate that all states will be expected to meet.  In  the interim, states are required to meet performance goals that they  negotiate annually with VETS based on historic outcome levels.  For  example, according to VETS, states’ program year 2004 negotiated goals  for entered employment ranged from 46 percent to 67 percent for veterans,  and from 41 percent to 65 percent for disabled veterans.
section_title: VETS Reports Meeting Goals, but Data Reliability Concerns Remain
paragraphs: Nationwide, VETS reported that the DVOP and LVER programs met  Labor’s goals for the entered employment rate (58 percent) for all eligible  veterans in program year 2003, while they fell short of their 60-percent  target entered employment rate for disabled veterans (see table 2).    Similarly, VETS reported that the programs exceeded goals for the rate at  which veterans retained employment 6 months later.
Even after the new measures will be adopted, VETS officials remain  concerned about the reliability of data used to assess performance.  VETS  officials attribute their concerns about service-related data reliability to  DVOP and LVER staff not understanding the new definitions of the  performance measures, lacking training on entering data into an  automated system, inconsistent registration policies, or simply inputting  erroneous data.  In addition, VETS officials told us that some states have  known data reliability issues with their management information systems.   While Labor has established data validation procedures, the reliability of  performance data is an issue that is not fully addressed by Labor’s current  validation procedures.  For example, all states must certify that their data  are correct using validation software that cross-checks the totals they  report to VETS.  However, validation does not extend to the case file level  to ensure that DVOP and LVER staff accurately collect and report data at  the point of service delivery.  In comparing the reliability of data on  services to those on employment outcomes, VETS officials believe that  outcome data are more reliable because they are based on Unemployment  Insurance (UI) wage records.  However, as we have noted in past work,  while UI wage records are reliable, they suffer from significant time lags,  resulting in at least an approximately 1½- year wait to obtain information  on outcomes.
section_title: Monitoring Systems Evolving to Strengthen Program Accountability
paragraphs: In response to JVA’s requirement to monitor the DVOP and LVER  programs, VETS has shifted greater responsibility for monitoring program  performance to the state level, and VETS’ monitoring role continues to  evolve from enforcer to partner in achieving state goals.  VETS staff  completed their first review of annual state self-assessments in program  year 2004 and have completed their first round of site visits to a random  sample of local offices.  However, the extent that this new approach to  monitoring DVOP and LVER performance strengthens program  accountability may require several years of state and VETS experience  collecting, reporting, and using information to improve services to  veterans.
subsections: section_title: First Round of Reviews Completed
paragraphs: Beginning in program year 2004, VETS began reviewing all the state plans  for compliance with program requirements and, for any deficiencies noted  during the review, required states to correct the relevant section of the  plan.  In addition, VETS requires states to submit annual self-assessments  to identify best practices, ensure the approved state plan is being  effectively implemented, determine the state’s progress toward meeting its  performance goals, and identify areas for technical assistance and training.
Besides conducting reviews of the state plans and self-assessments, VETS  also conducts annual on-site monitoring reviews of 20 percent of local  offices within each state, and all local offices must be visited at least once  in 5 years.  While we do not know how many offices have DVOP or LVER  staff, there are an estimated 1,900 comprehensive one-stop centers and  about 1,600 affiliate one-stop centers around the nation.  The on-site  reviews include interviewing personnel who are involved in providing  services to veterans, observing the flow of customers in the lobby, and  reviewing local guidance and plans.
section_title: VETS Still Working to Determine How Best to Use Monitoring Information
paragraphs: Now that VETS has completed its first year under the new performance  accountability system, it is unclear how it will use its monitoring results to  improve DVOP and LVER program performance.  At the national level,  VETS has developed a system to track corrective actions needed in states’  plans, but has not yet developed a strategy to best meld performance  information from its other monitoring efforts to improve program  performance at the local, state, and regional levels.  For example, VETS  officials in two states we visited told us that they use the site visit results  to identify local offices needing targeted technical assistance.  However,  one state VETS official told us that because local offices varied  considerably in their performance, he was uncertain whether the 20- percent sample used for site visits would accurately capture areas most in  need of technical assistance.  While information on DVOP and LVER  performance is also available through local office reporting, VETS officials  have not provided a consistent methodology to incorporate and analyze  relative performance among the local offices, states, and regional offices.   VETS and ETA continue to work on issues related to sharing the results of  monitoring efforts, coordinating corrective actions, and taking a joint  approach to enforcement.
Mr. Chairman, this concludes my prepared remarks.  I will be pleased to  answer any questions you or other members of the subcommittee may  have.  Our remaining work will examine these and other issues in greater  depth to meet our mandated reporting date at the end of the year.
section_title: Contact and Acknowledgments
paragraphs: For further information regarding this testimony, please contact me at  (202) 512- 7215.  Key contributors to this testimony were Lacinda Ayers,  Jeremy Cox, Meeta Engle, Emily Pickrell, and Stanley Stenersen.
section_title: Related GAO Products
paragraphs: Workforce Investment Act: States and Local Areas Have Developed  Strategies to Assess Performance, but Labor Could Do More to Help.   GAO-04-657. Washington, D.C.: June 1, 2004.
Veterans’ Employment and Training Service: Flexibility and  Accountability Needed to Improve Service to Veterans. GAO-01-928.  Washington, D.C.: September 12, 2001.
Veterans’ Employment and Training Service: Proposed Performance  Measurement System Improved, But Further Changes Needed.   GAO-01-580. Washington, D.C.: May 15, 2001.
Veterans’ Employment and Training Service:  Strategic and  Performance Plans Lack Vision and Clarity.  GAO/T-HEHS-99-177.  Washington, D.C.: July 29, 1999.
Veterans’ Employment and Training Service:  Assessment of the Fiscal  Year 1999 Performance Plan.  GAO/HEHS-98-240R. Washington, D.C.:  September 30, 1998.
Veterans’ Employment and Training:  Services Provided by Labor  Department Programs. GAO/HEHS-98-7. Washington, D.C.:  October 17,  1997.
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