Existing law requires the Department of Veterans Affairs to disburse funds, appropriated to the department for the purpose of supporting county veterans service officers pursuant to the annual Budget Act, on a pro rata basis, to counties a county that comply complies with certain conditions.

This bill would appropriate on an annual basis the sum of $5,600,000 from the General Fund to the Department of Veterans Affairs to be available for allocation to counties to fund the activities of county veterans service officers, as specified. The bill would specify that the money appropriated would only be available for encumbrance and expenditure for one year. The bill would require the department, no later than July 1, 2016, to develop an allocation formula based upon performance standards that encourage innovation and reward outstanding service by county veterans service officers, and would require those continuously appropriated moneys to be allocated allocated, upon appropriation by the Legislature, in accordance with that formula, as specified. The bill would require the department to annually report to the Legislature the efficacy, return on investment, work volume, and regional impact of the subvention funds on each county that receives those funds, as specified. The bill would also delete obsolete provisions and would make conforming changes.

Existing law requires the Department of Veterans Affairs to disburse funds, appropriated to the department for the purpose of supporting county veterans service officers pursuant to the annual Budget Act, on a pro rata basis, to counties that comply with certain conditions.

This bill would continuously appropriate on an annual basis the sum of $5,600,000 from the General Fund to the Department of Veterans Affairs to be available for allocation to counties to fund the activities of county veterans service officers, as specified. The bill would specify that the money appropriated would only be available for encumbrance and expenditure for one year. The bill would require the department, no later than July 1, 2016, to develop an allocation formula based upon performance standards that encourage innovation and reward outstanding service by county veterans service officers, and would require those continuously appropriated moneys to be allocated in accordance with that formula, as specified. The bill would also delete obsolete provisions and would make conforming changes.

This bill would declare that it is to take effect immediately as an urgency statute.

Existing law requires the Department of Veterans Affairs to disburse funds, appropriated to the department for the purpose of supporting county veterans service officers pursuant to the annual Budget Act, on a pro rata basis, to counties that comply with certain conditions.

This bill would continuously appropriate the sum of $5,600,000 from the General Fund to the Department of Veterans Affairs to be available for allocation to counties to fund the activities of county veterans service officers, as specified. The bill would require the department, no later than July 1, 2016, to develop an allocation formula based upon performance standards that encourage innovation and reward outstanding service by county veterans service officers, and would require those continuously appropriated moneys to be allocated in accordance with that formula, as specified. The bill would also delete obsolete provisions and would make conforming changes.

This bill would declare that it is to take effect immediately as an urgency statute.

Existing law requires the Department of Veterans Affairs to disburse funds, appropriated to the department for the purpose of supporting county veterans service officers pursuant to the annual Budget Act, on a pro rata basis, to counties that comply with certain conditions.

This bill would continuously appropriate the sum of $5,600,000 from the General Fund to the Department of Veterans Affairs to be available for allocation to counties to fund the activities of county veterans service officers, as specified. The bill would require the department, no later than July 1, 2016, to develop an allocation formula based upon performance standards that encourage innovation and reward outstanding service by county veterans service officers, and would require those continuously appropriated moneys to be allocated in accordance with that formula, as specified. The bill would also delete obsolete provisions and would make conforming changes.

This bill would declare that it is to take effect immediately as an urgency statute.

 THIRD READING  

Bill No: AB 171

Author: Irwin (D), et al.

Amended: 8/31/15 in Senate

Vote: 27 - Urgency

SENATE VETERANS AFFAIRS COMMITTEE: 5-0, 6/23/15

AYES: Nielsen, Hueso, Allen, Nguyen, Roth

SENATE APPROPRIATIONS COMMITTEE: 5-0, 8/27/15

AYES: Lara, Beall, Hill, Leyva, Mendoza

NO VOTE RECORDED: Bates, Nielsen

ASSEMBLY FLOOR: 78-0, 6/2/15 - See last page for vote

SUBJECT: Department of Veterans Affairs: veterans’ services

SOURCE: Author

DIGEST: This bill modifies the formula by which the Department of Veterans Affairs (CalVet) allocates state funds to county veterans service officers (CVSOs), and adds reporting requirements to help determine how effectively and efficiently state funds are being spent.

ANALYSIS:

Existing law:

1. Provides for CVSOs, who assist veterans in making claims for benefits provided for by federal or state law, and who perform other veteran-related services requested by the board of supervisors.

2. Provides that the compensation and expenses of the CVSO shall be a county charge, but CalVet, out of state moneys made available, shall pay each county a portion of those costs in an amount determined by CalVet.

3. Provides for an annual state appropriation for the CVSOs as determined in each year's Budget Act, currently funded at $5.6 million.

4. Requires CalVet to determine and report to the Department of Finance (DOF):

1. The number of claims filed to achieve benefits such as pension, disability compensation, and health care on behalf of veterans and their dependents.

2. The annualized monetary value of benefits received by veterans and their dependents as a result of the efforts of CVSOs, broken down by type of benefit.

3. A summary of other services provided by CVSOs and participation in outreach activities, such as homeless veteran “Stand Downs,” and job fairs.

5. Requires CalVet, on or before October 1 of each year, to prepare and transmit its determination for the preceding fiscal year to DOF and the Legislature.

6. Directs DOF to review CalVet's determination in time to use the information in the annual Budget Act with regard to CalVet’s budget for the next fiscal year.

7. Provides that state subvention funds shall be disbursed each fiscal year on a pro rata basis to counties that have established and maintain a CVSO in accordance with the staffing level and workload of each CVSO under a formula based upon performance, as specified, developed by CalVet.

8. Repeals existing language:

1. That will be superseded by the new allocation formula and reporting requirements.

2. That offers legislative findings, declarations and intent regarding CVSO funding levels.

This bill:

1. Requires CalVet, no later than July 1, 2016, to develop an allocation formula based upon performance standards that encourage innovation and reward outstanding service by CVSOs.

2. Requires that the moneys, upon appropriation by the Legislature, be allocated each fiscal year among only those counties that, in the discretion of the secretary, comply with the following requirements:

1. Establish and maintain a CVSO.

2. Collect and report all information required by CalVet in departmental regulations.

3. Comply with the training and accreditation standards for CVSOs and veterans service representatives (VSRs) as may be set by CalVet.

4. Require CVSOs and VSRs to become accredited with CalVet for the purposing of providing representation services before the United States Department of Veterans Affairs (USDVA) within 18 months of being hired, or on or before June 1, 2017, whichever is later.

5. Requires CalVet to report, annually to the Legislature, the efficacy, return on investment, work volume, and regional impact of the subvention funds on each county that receives those funds.

6. Also requires CalVet to report, annually to the Legislature by October 1:

1. The amount of new or increased monetary benefits paid to eligible veterans by the federal government attributable to CVSO assistance and the basis for that determination.

2. The amount paid to each county, including the amounts paid to each county for each category of workload unit, as defined, included in the allocation formula.

3. An evaluation as to each county’s use of subvention funds, including recommendations for improvement of each county’s use of subvention funds.

Background

County veterans service officers. CVSOs are trained, accredited professionals, who work at the county level of government and partner with CalVet. CVSOs may legally represent veterans in the federal benefits claims process, and also help connect veterans with state- and locally-provided benefits. VSRs are claims workers who work under the supervision of CVSOs.

Collectively, the CVSOs, through claims initiation and development, and CalVet, through claims development and representation, provide assistance to veterans and their dependents in preparing and submitting claims and in representing claimants before the federal, state and local agencies providing veterans benefits. CVSOs use the CalVet-sponsored VetPro software program to enhance their claims reporting and tracking.

California’s utilization of veteran benefits. California’s utilization of the primary monetary veteran benefits, referred to as compensation and pension, has historically lagged behind that of the nation as a whole. Recently, however, California has improved its utilization rates.

In 2007, CalVet recommended several strategies to address benefit underutilization, including providing resources in support of additional full time professional service representative staff with a focus on areas with large veteran populations and lower than average benefit participation rates. The primary strategies are:

1. That subvention funding for CVSOs should be increased to support an expansion of CVSO office staffing. The additional funding shall be directed to expanding the staff dedicated to full time outreach and claims work.

2. That resources are needed to fund additional professional service representative staff at CalVet district offices in support of claims representation (appeals), local training, and local outreach. Outreach should specifically increase in areas where the state can provide economy of scale.

According to CalVet’s latest annual report (October 20, 2014), CVSOs brought in approximately $546 million in new, recurring veteran benefits into the state’s economy.

CVSO funding. While CVSOs are independent local agencies, funding is derived from a combination of local and state resources. The state provides limited local assistance funding from various sources, including the General Fund (subvention), Veterans Service Office Fund, and reimbursements (Medi-Cal cost avoidance). The subvention funding is appropriated to CalVet, which allocates the funds to the CVSOs.

Since 2004, the state’s contribution to CVSO funding has languished at $2.6 million until recent years. The Legislature enacted consecutive “one-time” augmentations of $3 million, which were included, respectively, in the 2013-14 and 2014-15. The 2015-16 state budget process established the level of $5.6 as the new budgetary baseline.

The single-year augmentations have been dedicated to one of three main themes from the CalVet/CVSO best practices manual:

• Contacting veterans.

• Connecting veterans to their benefits and services.

• Continuous communication with veterans.

The funding increase boosted the abilities of CVSOs and CalVet to connect veterans in their communities with the expansion of outreach activities, thereby linking more veterans with their community-based system of care and local service providers. The funds have allowed for the deployment of 32.5 additional professional VSRs and 30 support staff to connect veterans with their compensation and pension benefits available through the USDVA, resulting in an increase of federal dollars drawn down to the state this year and continuing into future years.

Comments

1. The previous version of this bill contained a provision, which would have continuously appropriated $5.6 million annually from the General Fund to CalVet for allocation to counties to fund CVSO activities. This was removed in Senate Appropriations Committee.

2. In July 2015, the State Auditor released Report 2015-505, which concluded, among other things, that CalVet’s auditing of CVSO workload activity reports is inadequate and hinders the department’s ability to demonstrate that the funding it distributes to the CVSOs is consistent with their actual workloads:

• The auditing process does not generally identify errors that can be found only by reviewing the records that are the basis of the reports.

• The procedures for conducting audits are not documented, thereby reducing assurance that audits are conducted correctly and completely.

According to CalVet, the language in AB 171 is part of the Department’s effort to respond to the audit’s findings and recommendations.

Related/Prior Legislation

AB 2703 (Quirk-Silva, 2014) (1) would have required CalVet, no later than January 1, 2015, to develop an allocation formula based upon performance standards that incentivize CVSO performance; and (2) would have declared the Legislature’s intent to fund specified CVSO activities and to provide an additional $400,000 for disbursement to the counties to encourage innovation and reward outstanding service by CVSOs. (Held, suspense, Senate Committee on Appropriations)

SB 419 (Senate Committee on Veterans Affairs, Chapter 48, Statutes of 2009) (1) revises findings and declarations in existing law by declaring that 50 percent of the amount annually budgeted for CVSOs is (should be) approximately $11 million (rather than the existing $5 million), and (2) sunsets after January 1, 2016.

SB 418 (Senate Committee on Veterans Affairs, Chapter 48, Statutes of 2009) revises existing legislative findings and declarations with regard to the use of General Fund monies for services provided by veterans service organizations by clarifying that the General Fund monies shall not be allocated until the annual budget for CVSOs reaches $5 million.

FISCAL EFFECT: Appropriation: Yes Fiscal Com.: Yes Local: No

According to the Senate Appropriations Committee:

• Unknown costs, potentially in the tens of thousands for CalVet to annually report on the impact of funds provided in the annual Budget Act to support activities of CVSOs (General Fund).

• Minor costs to develop an allocation formula to govern the distribution of the appropriated funds to CVSOs (General Fund).

SUPPORT: (Verified 8/28/15)

None received

OPPOSITION: (Verified 8/28/15)

None received

ASSEMBLY FLOOR: 78-0, 6/2/15

AYES: Achadjian, Alejo, Travis Allen, Baker, Bigelow, Bloom, Bonilla, Bonta, Brough, Brown, Burke, Calderon, Campos, Chang, Chau, Chiu, Chu, Cooley, Cooper, Dababneh, Dahle, Daly, Dodd, Eggman, Frazier, Beth Gaines, Gallagher, Cristina Garcia, Eduardo Garcia, Gatto, Gipson, Gomez, Gonzalez, Gordon, Gray, Hadley, Harper, Roger Hernández, Holden, Irwin, Jones, Jones-Sawyer, Kim, Lackey, Levine, Linder, Lopez, Low, Maienschein, Mathis, Mayes, McCarty, Medina, Melendez, Mullin, Nazarian, Obernolte, O'Donnell, Olsen, Patterson, Perea, Quirk, Rendon, Ridley-Thomas, Rodriguez, Salas, Santiago, Steinorth, Mark Stone, Thurmond, Ting, Wagner, Waldron, Weber, Wilk, Williams, Wood, Atkins

NO VOTE RECORDED: Chávez, Grove

Prepared by: Wade Cooper Teasdale / V.A. / (916) 651-1503

8/30/15 19:49:06

**** END ****

SENATE COMMITTEE ON APPROPRIATIONS

Senator Ricardo Lara, Chair

2015 - 2016 Regular Session

AB 171 (Irwin) - Department of Veterans Affairs: veterans’ services.

*********** ANALYSIS ADDENDUM – SUSPENSE FILE ***********

The following information is revised to reflect amendments

adopted by the committee on August 27, 2015

Bill Summary:

This bill requires the Department of Veterans Affairs (Department) to develop an allocation formula for funding provided to counties to support the activities of county veterans service officers. This bill also requires the Department to annually report to the Legislature on the impact of these funds.

Fiscal Impact:

• Unknown costs, potentially in the tens of thousands for the Department to annually report on the impact of funds provided in the annual Budget Act to support activities of county veterans service officers (General Fund).

• Minor costs to develop an allocation formula to govern the distribution of the appropriated funds to county veterans service officers (General Fund).

Author Amendments:

Amend to remove appropriation and add a reporting requirement regarding the impact of funds, as specified, provided in the budget for county veterans service officers.

-- END --

SENATE COMMITTEE ON APPROPRIATIONS

Senator Ricardo Lara, Chair

2015 - 2016 Regular Session

AB 171 (Irwin) - Department of Veterans Affairs: veterans’ services

This bill meets the criteria for referral to the Suspense File.

Bill Summary:

AB 171 would appropriate $5.6 million from the General Fund every year to the Department of Veterans Affairs to support county veterans service officers.

Fiscal Impact:

• Annual costs of $5.6 million per year to provide support to county veterans service officers by the Department of Veteran’s Affairs (General Fund).

• Minor costs to develop an allocation formula to govern the distribution of the appropriated funds to county veterans service officers (General Fund). The Department has already developed most of the criteria required in the bill.

Background:

County veterans service officers are county officials who are authorized to represent veterans in the process for claiming federal veterans’ benefits. 56 of California’s 58 counties have a county veterans service officer. Due to historically low levels of receipt of benefits by California’s veterans, the Department of Veteran’s Affairs has provided funding to county veterans service officers to provide assistance to veterans in claiming the benefits they are entitled to.

Current law authorizes funding in the annual budget act to the Department of Veteran’s Affairs for allocation to county veterans service officers. Current law requires the Department to collect information on the additional federal veterans’ benefits that California veterans receive due to assistance by county veterans service officers.

Proposed Law:

AB 171 would appropriate $5.6 million from the General Fund every year to the Department of Veterans Affairs for allocation to counties to support county veterans service officers.

The bill would require the Department of Veteran’s Affairs to develop an allocation formula based upon performance standards for allocating the appropriated money to county veterans service officers.

This bill is an urgency measure.

Related Legislation:

AB 2703 (Quirk-Silva, 2014) would have required the Department of Veteran’s Affairs to develop an allocation formula to distribute funds to county veterans service officers. That bill was held on this committee’s Suspense File.

Staff Comments: The current year (2015-16) budget includes $7.5 million in funding for county veterans service officers, including $5.6 million from the General Fund.

By assisting veterans with the requirements to access their benefits, county veterans service officers help veterans access the benefits they are entitled to, bring additional federal funds into the state economy, and potentially reduce the dependence of veterans on state and local programs. According to the Department of Veterans’ Affairs, during the 2013-14 fiscal year, county veterans service officers assisted California veterans in accessing $545 million in federal benefits.

-- END --

SENATE COMMITTEE ON VETERANS AFFAIRS

Senator Jim Nielsen, Chair

2015 - 2016 Regular

Bill No: AB 171 Hearing Date: 6/23/15

Subject: Department of Veterans Affairs: veterans’ services.

DESCRIPTION

Summary:

Appropriates $5.6 million annually to the California Department of Veterans Affairs (CalVet) for allocation to counties to fund county veterans service officers (CVSOs).

Existing law:

1. Provides for annual appropriation to the CVSOs as determined in each year's Budget Act.

2. Requires CalVet to determine and report to the Department of Finance (DOF) the following: The amount of new or increased monetary benefits paid to eligible veterans by the federal government that is attributable to the assistance by CVSOs.

3. Mandates that CalVet must, on or before October 1 of each year, prepare and transmit its determination for the preceding fiscal year to the Department of Finance and the Legislature.

4. Directs DOF to review CalVet's determination in time to use the information in the annual Budget Act with regard to CalVet’s budget for the next fiscal year (FY).

This bill:

1. Appropriates $5.6 million annually from the General Fund (GF) to CalVet for allocation to counties to fund the activities of CVSOs.

2. Clarifies that this money shall be available for encumbrance and expenditure for only one year from the date upon which it first becomes available for encumbrance.

3. Directs CalVet to develop, no later than July 1, 2016, an allocation formula based upon performance standards that encourage innovation and reward outstanding service by CVSOs. Moneys appropriated for this purpose shall be allocated each FY in accordance with that formula among those counties that have established and maintained a CVSO office.

4. Contains an urgency clause. The basis for the urgency is stated as: "Approximately 50 percent of the current GF appropriation in support of county veteran service offices operations expires on June 30, 2015. In order to provide for continuity of services critical to the successful reintegration of California’s veterans, to increase California’s utilization of veteran benefits, and to ensure veteran’s claims for benefits are processed in a timely manner, it is necessary that this act take effect immediately."

5. Deletes existing references in statute that are obsolete or conflict with this bill’s provisions.

BACKGROUND

County Veterans Service Officers

CVSOs are trained, accredited professionals, who may legally represent veterans in the federal benefits claims process, and also help connect veterans with state- and locally-provided benefits. Fifty-six of California’s 58 counties have CVSOs, whose professional interests are represented by the California Association of County Veterans Service Officers (CACVSO).

The California CVSO model requires close partnership between state and county governments through the auspices of CalVet and the various CVSO offices. Collectively, the CVSO, through claims initiation and development, and CalVet, through claims development and representation, provide assistance to veterans and their dependents in preparing and submitting claims and in representing claimants before the federal, state and local agencies providing veterans benefits. CVSOs use the CalVet-sponsored VetPro software program to enhance their claims reporting and tracking.

California’s Utilization of Veteran Benefits

California’s utilization of the primary monetary veteran benefits, referred to as compensation and pension (C&P), has historically lagged behind that of the nation as a whole. Recently, however, California has improved its utilization rates.

In 2007, CalVet recommended several strategies to address benefit underutilization, including providing resources in support of additional full time professional service representative staff with a focus on areas with large veteran populations and lower than average benefit participation rates. The primary strategies are:

1. That subvention funding for CVSOs should be increased to support an expansion of county veterans service office staffing. The additional funding shall be directed to expanding the staff dedicated to full time outreach and claims work.

2. That resources are needed to fund additional professional service representative staff at CalVet district offices in support of claims representation (appeals), local training, and local outreach. Outreach should specifically increase in areas where the state can provide economy of scale.

According to CalVet’s latest annual report (October 20, 2014), CVSOs brought in approximately $546 million in new, recurring veteran benefits into the state’s economy.

CVSO Funding

While CVSOs are independent local agencies, funding is derived from a combination of local and state resources. The state provides limited local assistance funding from various sources, including the GF (subvention), Veterans Service Office Fund (VSOF), and reimbursements (Medi-Cal cost avoidance). The subvention funding is appropriated to CalVet, which allocates the funds to the CVSOs.

Although Military and Veterans Code (MVC) Section 972.1 sets a target of $11 million dollars for subvention funding, actual funding has never reached that level. Since 2004, the state’s contribution to CVSO funding has languished at $2.6 million with two temporary exceptions. The exceptions occurred recently, when the Legislature enacted two consecutive single-year augmentations of $3 million, which were included, respectively, in the 2013-14 and 2014-15 state budget bills.

The two additional single-year augmentations were dedicated to one of three main themes from the CalVet/CVSO best practices manual:

• Contacting veterans.

• Connecting veterans to their benefits and services.

• Continuous communication with veterans.

The funding increase boosted the abilities of CVSOs and CalVet to connect veterans in their communities with the expansion of outreach activities, thereby linking more veterans with their community-based system of care and local service providers. The funds have allowed for the deployment of 32.5 additional professional veterans service representatives and 30 support staff to connect veterans with their compensation and pension benefits available through the USDVA, resulting in an increase of federal dollars drawn down to the state this year and continuing into future years.

COMMENT

Author Statement

"California is home to an estimated two million veterans, and their widows or widowers, who are often unaware that they may be eligible for benefits or federal pensions and California’s CVSOs are the initial local point of contact for these potential claimants.

“According to CalVet reporting, it has been determined that from 1995 to 2013, the state had cumulatively budgeted $41.4 million to CVSO funding, an investment that helped local veterans obtain $4.1 billion in new federal moneys. This is a return of about $98 for every $1 the state allocates to CVSOs. Furthermore, the $4.1 billion in new funding reflects benefits that veterans and their dependents may continue to receive for the rest of their lives.”

Committee Comments

Without permanent legislative recalibration or another temporary, annual Budget augmentation, State GF funding for CVSOs will continue at $5.6 million only through June 2015, then will revert back to $2.6 million. During the period 2007 to 2013, the Legislature considered numerous bills, which would have increased state subvention funding to CVSOs, but none were enacted. If enacted, AB 171 would break through that wall.

Related Legislation

AB 2703 (Quirk-Silva, 2014): (1) requires CalVet, no later than January 1, 2015, to develop an allocation formula based upon performance standards that incentivize CVSO performance; and (2) declares the Legislature’s intent to fund specified CVSO activities and to provide an additional $400,000 for disbursement to the counties to encourage innovation and reward outstanding service by CVSOs. (Held, suspense, Senate Committee on Appropriations)

SB 419 (Senate Veterans Affairs Comm, Chapter 48, Statutes of 2009) (1) revises findings and declarations in existing law by declaring that 50 percent of the amount annually budgeted for CVSOs is (should be) approximately $11 million (rather than the existing $5 million); (2) sunsets after January 1, 2016; and (3) only becomes operative if SB 418 (Senate Committee on Veterans Affairs, 2009) is chaptered. This majority-vote bill contained no appropriation, and was not keyed fiscal.

SB 418 (Senate Veterans Affairs Comm, Chapter 48, Statutes of 2009) revises legislative findings and declarations in existing law with regard to the use of General Fund monies for services provided by veterans service organizations by clarifying that the General Fund monies shall not be allocated until the annual budget for CVSOs reaches $5 million. Contained no appropriation. Nonfiscal.

SB 1778 (Senate Committee on Veterans Affairs, 2008) changes findings and declarations by increasing the amount budgeted for CVSOs from $5 million to $11 million. This bill was not an appropriation. (Vetoed)

SB 1222 (Cedillo, 2008) (1) increases funding for veterans outreach by appropriating three dollars for every California veteran; and (2) requires that each three-dollar appropriation be disbursed as follows: CVSOs - $2.35; veteran service organizations - $0.50; and the Veteran Services Division/CalVet - $0.15. (Held, suspense, Senate Committee on Appropriations)

AB 1814 (DeVore, 2008) “The Veterans Benefit Recovery Augmentation Plan” facilitates CalVet contracting with veteran services organizations to augment the outreach services provided CalVet’s Veterans Service Division. (Held, suspense, Senate Committee on Veterans Affairs)

AB 2577 (Salas, 2008) supports reinstating funding cut by the Governor for the CVSOs as well as the State Veteran Service Officers. (Held Assembly Committee on Rules)

AB 389 (Salas, 2007) appropriates $5,000,000 from the General Fund to CalVet for disbursement to the counties. (Held, suspense, Assembly Committee on Appropriations)

AB 2268 (Samuelian, Chapter 804, Statutes of 2004) authorizes CalVet to contract out services to VSOs and, with the approval from the Department of Finance, to reimburse those organizations for services rendered on a formula/performance basis starting in fiscal year 2006-07.

SB 608 (Johannessen, Chapter 318, Statutes of 1997) approves a CVSO funding level of up to $5,000,000 of which only approximately $2,500,000 has traditionally been funded.

POSITIONS

Sponsor: California Association of County Veteran Service Officers (CACVSO)

Support:

Amador, County of

American Legion, Department of California

AMVETS, Department of California

California State Association of Counties (CSAC)

California State Commanders Veterans Council

Butte, County of

Colusa, County of

Contra Costa, County of

Del Norte, County of

El Dorado, County of

Fresno, County of

Glendale City Employees Association

Kings, County of

Placer, County of

Los Angeles, County of

Madera, County of

Mariposa, County of

Merced, County of

Plumas, County of

Marin, County of

Military Officers Association of America, California Council of Chapters

Napa, County of

National Guard Association of California

Rural County Representatives of California (RCRC)

San Bernardino Public Employees Association

San Joaquin County Health Care Services Agency

San Luis Obispo County Employees Association

Santa Barbara, County of

Shasta, County of

Sierra, County of

SMUD Employees

Tehama, County of

Tulare, County of

Ventura, County of

Veterans of Foreign Wars, Department of California

Vietnam Veterans of America, California State Council

Yuba, County of

Oppose: None received

-- END --

ASSEMBLY THIRD READING

ATR Bill Id:AB 171

Author:(Irwin)

As Amended Ver:May 28, 2015

2/3 vote. Urgency

SUMMARY: Appropriates money to the California Department of Veterans Affairs (CDVA) for allocation to the County Veterans Service Officers (CVSOs) as specified. There are currently two Military and Veterans Code Section 972.1; one is applicable until the end of 2015, another applies January 1, 2016. As to the current section, this bill deletes language pertaining to a $500,000 appropriation and other obsolete references that would conflict with the intent to raise the annual appropriation to $5.6 million dollars. Specifically, this bill:

1. As to the Military and Veterans Code Section 972.1 taking effect January 1, 2016, deletes conflicting or obsolete references and raises the annual appropriation minimum to $5.6 million.

2. Adds Military and Veterans Code Section 972.3. This new section:

   1. Appropriates $5.6 million annually from the General Fund (GF) to CDVA for allocation to counties to fund the activities of county veterans service officers pursuant to Military and Veterans Code Section 972.1(a).

   2. Clarifies that this money shall only be available for encumbrance and expenditure for one year from the date upon which it first becomes available for encumbrance.

   3. Directs the CDVA to, no later than July 1, 2016, develop an allocation formula based upon performance standards that encourage innovation and reward outstanding service by county veterans service officers. Moneys appropriated for this purpose shall be allocated each fiscal year (FY) in accordance with that formula among those counties that have established and maintained a county veterans service officer pursuant to Military and Veterans Code Section 970.

   4. Contains an urgency clause. The basis for the urgency is stated as: "Approximately 50 percent of the current GF appropriation in support of county veteran service offices operations expires on June 30, 2015. In order to provide for continuity of services critical to the successful reintegration of California’s veterans, to increase California’s utilization of veteran benefits, and to ensure veteran’s claims for benefits are processed in a timely manner, it is necessary that this act take effect immediately."

FISCAL EFFECT: According to the Assembly Appropriations Committee:

1. The Governor's Budget proposes a $2.6 million GF appropriation to the CDVA for allocation to the CVSOs in 2015-16. Assuming this amount was approved and was the same every year thereafter, the annual impact of this bill will be an additional $3 million GF cost.

2. Minor one-time costs to the CDVA to develop an allocation formula.

3. Unknown savings to various state programs if the CVSOs are able to transfer participants from state programs to appropriate federal veterans programs.

The additional work by CVSOs may result in additional federal payments to California veterans.

COMMENTS: CVSOs are local agencies established in 1946 to assist veterans and their families in obtaining benefits and services accrued through military service. They act as the department's network for claim initiation and development and draw down significant federal dollars annually.

The cost of maintaining a CVSO is primarily a county general fund expense; however, counties with an established CVSO receive some State reimbursement funds as authorized by the California Military and Veterans Code. Depending on the revenue source, these funds are distributed either based on specific performance measurements or as a percentage of net county cost. It is important to emphasize that while state general funds and federal pass-through funds distributed by the CDVA assists counties in maintaining their CVSOs, the primary cost of the CVSO program statewide is a county expense, as opposed to a State expense. Funds received by CVSOs are subject to both internal county audits and regular audits by the CDVA in accordance with the California Code of Regulations.

According to the California Association of County Veterans Service Officers 2015 Annual Report and Directory, in FY 2013-14, when CVSO state local assistance funding was temporarily increased from $2.6 million to $5.6 million, the CVSO’s were able to increase federal benefits to California veterans by over $100 million.

The total state audited amount of federal compensation and pension payments to veterans and their families rose from $445 million in FY 2012-13 to $545 million in FY 2013-14. The majority of those payments are paid monthly to the veteran over his or her lifetime.

California’s Utilization of Veteran Benefits

California’s utilization of the primary monetary veteran benefits, referred to as compensation and pension (C&P), has historically lagged behind the nation as a whole. Recently, however, California has improved its utilization rates though there is still work to be done.

In 2007 CDVA recommended several strategies to correct the underutilization including:

…providing resources in support of additional full time professional service representative staff with a focus on areas with large veteran population and lower than average benefit participation rates.

1. Subvention funding for county veteran service offices should be increased to support an expansion of county veterans service office staffing. The additional funding shall be directed to expanding the staff dedicated to full time outreach and claims work.

2. Resources are needed to fund additional professional service representative staff at CalVet district offices in support of claims representation (appeals), local training, and local outreach. Outreach should specifically increase in areas where the State can provide economy of scale.

Currently subvention funding in support of CVSO operations is temporarily at $5.6 million but is scheduled to revert to the historic level of $2.6 million unless action is taken to set a new minimum funding level. Many counties used this temporary increase to add additional staff but also report that those positions are temporary and most will be eliminated if the funding is not made permanent.

Analysis Prepared by: John Spangler / V.A. / (916) 319-3550 FN: 0000700

Date of Hearing: March 25, 2015

ASSEMBLY COMMITTEE ON APPROPRIATIONS

Jimmy Gomez, Chair

ABPCA Bill Id:AB 171

Author:(Irwin) – As Amended Ver:March 17, 2015

Urgency: Yes State Mandated Local Program: No Reimbursable: No

SUMMARY:

This bill, beginning July 1, 2015, continuously appropriates $5.6 million from the General Fund (GF) annually to the California Department of Veterans Affairs (CDVA) for allocation to County Veterans Service Officers (CVSOs). The CDVA is required to develop an allocation formula by July 1, 2016

FISCAL EFFECT:

1. The Governor's Budget proposes a $2.6 million GF appropriation to the CDVA for allocation to the CVSOs in 2015-16. Assuming this amount was approved and was the same every year thereafter, the annual impact of this bill will be an additional $3 million GF cost.

2. Minor one-time costs to the DCVA to develop an allocation formula.

3. Unknown savings to various state programs if the CVSOs are able to transfer participants from state programs to appropriate federal veterans programs.

The additional work by CVSOs may result in additional federal payments to California veterans.

COMMENTS:

1. Purpose: According to the author, recent military conflicts are creating a new generation of veterans eligible for federal benefits. CVSOs are local agencies established in 1946 to assist veterans and their families in obtaining benefits and services accrued through military service. AB 171 is intended to provide a minimum level of predictable funding for CVSOs.

2. Background: Funding for CVSOs is provided in each year's Budget Act. The current Budget Act includes $5.6 million (GF), but the 2014-15 Governor's Budget proposes $2.6 million (GF).

3. Comments: This committee generally does not support continuous appropriations, which reduce legislative discretion.

Analysis Prepared by: Pedro Reyes / APPR. / (916) 319-2081

Date of Hearing: March 10, 2015

ASSEMBLY COMMITTEE ON VETERANS AFFAIRS

Irwin, Chair

ABPCA Bill Id:AB 171

Author:(Irwin) – As Introduced Ver:January 22, 2015

SUBJECT:

Department of Veterans Affairs: veterans’ services.

Appropriates money to the California Department of Veterans Affairs (CDVA) for allocation to the County Veterans Service Officers (CVSOs) as specified. There are currently two Military and Veterans Code sections 972.1, one is applicable until the end of 2015, another applies January 1, 2016. As to the current section, this bill deletes language pertaining to a $500,000 appropriation and other obsolete references that would conflict with the intent to raise the appropriation to $5.6 million dollars.

Specifically, this bill:

1. As to the section 972.1 taking effect January 1, 2016, deletes conflicting or obsolete references and raises the annual appropriation minimum to $5.6 million.

2. Adds section 972.3. This new section:

1. Continuously appropriates five million six hundred thousand dollars ($5,600,000) annually from the General Fund to CDVA for allocation to counties to fund the activities of county veterans service officers pursuant to subdivision (a) of Section 972.1.

2. Directs the Department of Veterans Affairs to, no later than July 1, 2016, develop an allocation formula based upon performance standards that encourage innovation and reward outstanding service by county veterans service officers. Moneys appropriated for this purpose shall be allocated each fiscal year in accordance with that formula among those counties that have established and maintained a county veterans service officer pursuant to Section 970.

3. Contains an urgency clause. The basis for the urgency is stated as : "Approximately 50 percent of the current General Fund appropriation in support of county veteran service offices operations expires on June 30, 2015. In order to provide for continuity of services critical to the successful reintegration of California’s veterans, to increase California’s utilization of veteran benefits, and to ensure veteran’s claims for benefits are processed in a timely manner, it is necessary that this act take effect immediately."

EXISTING LAW:

1. Provides for annual appropriation to the CVSOs as determined in each year's Budget Act.

2. Requires annual reporting by CDVA to the Department of Finance The department must annually determine the amount of new or increased monetary benefits paid to eligible veterans by the federal government attributable to the assistance of county veterans service officers.

3. Mandates that CDVA must, on or before October 1 of each year, prepare and transmit its determination for the preceding fiscal year to the Department of Finance and the Legislature.

4. Directs the Department of Finance to review CDVA's determination in time to use the information in the annual Budget Act for the budget of CDVA for the next fiscal year.

FISCAL EFFECT: Unknown at this time.

COMMENTS:

CVSOs are local agencies established in 1946 to assist veterans and their families in obtaining benefits and services accrued through military service. They act as the department's network for claim initiation and development and draw down significant federal dollars annually.

The cost of maintaining a CVSO is primarily a county general fund expense; however, counties with an established CVSO receive some State reimbursement funds as authorized by the California Military and Veterans Code. Depending on the revenue source, these funds are distributed either based on specific performance measurements or as a percentage of net county cost. It is important to emphasize that while state general funds and federal pass-through funds distributed by the California Department of Veterans Affairs (CalVet) assists counties in maintaining their CVSOs, the primary cost of the CVSO program statewide is a county expense, as opposed to a State expense. Funds received by CVSOs are subject to both internal county audits and regular audits by the CalVet in accordance with the California Code of Regulations.

According to the California Association of County Veterans Service Officers 2015 Annual Report and Directory, in FY 2013-14, when CVSO state local assistance funding was temporarily increased from $2.6 million to $5.6 million, the CVSO’s were able to increase federal benefits to California veterans by over $100 million.

The total state audited amount of federal compensation and pension payments to veterans and their families rose from $445 million in FY 2012-13 to $545 million in FY 2013-14. The majority of those payments are paid monthly to the veteran over his or her lifetime.

CALIFORNIA’S UTILIZATION OF VETERAN BENEFITS

California’s utilization of the primary monetary veteran benefits, referred to as compensation and pension (C&P), has historically lagged behind the nation as a whole. Recently, however, California has improved its utilization rates though there is still work to be done.

In 2007 CalVet recommended several strategies to correct the underutilization including:

“… providing resources in support of additional full time professional service repre­sentative staff with a focus on areas with large veteran population and lower than average benefit participation rates.

a. Subvention funding for county veteran service offices should be increased to support an expansion of county veterans service office staffing. The additional funding shall be directed to expanding the staff dedicated to full time outreach and claims work.

b. Resources are needed to fund additional professional service representative staff at CalVet district offices in support of claims representation (appeals), local training, and local outreach. Outreach should specifically increase in areas where the State can provide economy of scale.”

Currently subvention funding in support of CVSO operations is temporarily at $5.6 million but is scheduled to revert to the historic level of $2.6 million unless action is taken to set a new minimum funding level. Many counties used this temporary increase to add additional staff but also report that those positions are temporary and most will be eliminated if the funding is not made permanent.

REGISTERED SUPPORT / OPPOSITION:

Support

American Legion, Department of California

AMVETS, Department of California

California State Commanders Veterans Council

County of Butte

County of El Dorado

County of Fresno

County of Plumas

County of Santa Barbara

County of Shasta

County of Sierra

County of Tehama

County of Ventura

County of Yuba

Military Officers Association of America, California Council of Chapters

Veterans of Foreign Wars, Department of California

Vietnam Veterans of America, California State Council

Opposition

None on File

Analysis Prepared by:

John Spangler/V.A./(916) 319-3550