to be asking them to do border security and other things. At the very minimum, for God's sake, we ought to give them the same protection.

They are there. It is national emergency. The Governor has called them up at the request of the President of the United States of America. Why in the world do we not give them the same protection?

So, today, as a member of this committee, I hope we will move this legislation expeditiously, and I would like to smoke the Department of Defense out. I would like to know what is the possible justification for their opposition? Because so far the only thing I have heard, does not hold up, which is, well, States should do it. States cannot. States do not have the authority.

So I hope we can move this legislation, and frankly I hope we can pass this. I wish we could figure out a way of-I know the Guard members will say, hey, we are serving our country, but I wish we could figure out some way of providing some kind of income assistance or something that helps these families because they are really hurting.

Thank you.

[The prepared statement of Senator Wellstone follows:]

PREPARED STATEMENT OF HON. PAUL WELLSTONE, U.S. SENATOR FROM MINNESOTA

I am glad to be here this morning to talk about S. 1680, a bill to amend the Soldiers' and Sailors' Civil Relief Act (SSCRA) to expand the protections of that Act to National Guard personnel protecting our nation's airports and other vulnerable public facilities. Specifically, the bill will provide civil relief to National Guard personnel mobilized by state governors at the request of the President, in support of an operation during a war or national emergency.

The SSCRA provides essential protections to service-members on active duty. Unfortunately, it only applies to National Guard personnel mobilized directly by the President of the United States, and does not protect those mobilized by state governors at the request of the President-as is the case with many of the men and women protecting our nations airports and other public facilities.

Right now nationwide there are about 7,600 National Guard personnel in active duty title 32-status conducting these essential security missions. About 5,800 of them are at 405 airports throughout the nation. In Minnesota, we have 31 MN National Guard soldiers providing security at the Minneapolis-St. Paul airport. The President has stated he is determined to remove the National Guard from airport security duty and that de-mobilization is underway. Unfortunately, in the meantime, the men and women of the National Guard doing this important work are not receiving the financial protections they rightly deserve.

Colleagues, the SSCRA is an important Act that provides help to people who have taken on financial burdens without knowing they would be called up to serve in the military. I won't go into too much detail of the protections offered by it though I would like to mention a few. The SSCRA provides substantial debt relief, capping interest rates at 6% for any debts a service-member incurred before he or she went on active duty. This is very important since many of these men and women have mortgages on their homes and student loans, but have left higher-paying jobs to provide security for their fellow citizens. Capping interest on their debt is important to ensuring their and their loved ones financial security. The SSCRA also protects service-members on active federal duty against court judgments, evictions and cancellation of their life insurance.

S. 1680 passed the Senate, with 12 co-sponsors, as an amendment to the 2002 Department of Defense Appropriations Bill. Unfortunately, it was stripped out of the conference report to that bill. Today the bill has the support of the Military Coalition-a consortium of 33 nationally prominent uniformed services and veterans organizations, representing more than 5.5 million current and former members of the seven uniformed services, plus their families and survivors-as well as the Minnesota National Guard. I would like to insert in the Committee record letters of support for the bill from the Military Coalition and the Enlisted Association of the National Guard.

I understand the Committee has requested DOD's formal written views on the bill. I look forward to hearing those views. To date, DOD has opposed S. 1680 due to command structure differences between service-members called up by a state and those under the command of the Federal government, and because DOD believes states, and not the federal government, should provide "Soldiers and Sailors-like" protections. It is clear to me and all those that I have spoken with that DOD's reasoning for this opposition is flawed.

The federal government pays the salaries of National Guard men and women in title 32 status and title 32 missions are always federal missions, regardless of the command and control situation. National Guard personnel in title 32 status deserve the same protections of those in title 10 status because, honestly, they are doing a very similar type of duty. It is impossible to articulate why one Guardsman who is in title 32 status on airport security duty can lose his home to foreclosure while one in title 10 status on border security duty can not. The fact that the Governor issued the call-up orders rather than the President himself is irrelevant.

DOD has also suggested that State's should provide "Soldiers' and Sailors-like" protections but that solution that will not work for many National Guard personnel. The U.S. Supreme Court made clear in Marquette National Bank of Minneapolis v. First of Omaha Service Corp. Et. Al. (439 U.S. 299) that one state can not regulate the interest rate of a national bank located in another state. One of the primary benefits of the SSCRA is the 6% cap on interest rates. A state simply can not enforce such a state law.

We are in a very unique situation. We must be aware that National Guard units may be asked to do more in the coming months and years. S. 1680 will ensure we provide our citizen-soldiers the civil relief they rightly deserve. Addressing this now will ease the burden placed upon these patriots and their families now and in the future. Colleagues, these young people are not asking for much. Extending the protections of the SSCRA is an important way to say that we value their service and that we will not forget them or their families commitment to the United States. I urge my colleagues to support it.

Chairman ROCKEFELLER. Thank you, Senator Wellstone.

I want to move on now to our panel. We are going to hear from Tim McClain, who is the VA General Counsel, who is accompanied by-is my protocol correct?

Mr. MCCLAIN. Yes, sir.

Chairman ROCKEFELLER. -Dr. Fran Murphy, Deputy Under Secretary of Health; Bob Epley, VBA's Associate Deputy Under Secretary for Policy and Program Management; Jack Thompson, the Deputy General Counsel; Mick Kicklighter, the Assistant Secretary for Policy and Planning and currently Acting Director of the new Office of Operations, Security and Preparedness; and Vince Barile, who is Deputy Under Secretary for Management from the National Cemetery Administration. I thank you all for coming.

Mr. McClain is right in front of me. I put to you the impossible task of trying to do this in 5 minutes.

STATEMENT OF HON. TIM MCCLAIN, GENERAL COUNSEL, DEPARTMENT OF VETERANS AFFAIRS, ACCOMPANIED BY FRANCES M. MURPHY, M.D., DEPUTY UNDER SECRETARY FOR HEALTH, VETERANS HEALTH ADMINISTRATION; ROBERT EPLEY, ASSOCIATE DEPUTY UNDER SECRETARY FOR POLICY AND PROGRAM MANAGEMENT, VETERANS BENEFITS ADMINISTRATION; JOHN [JACK] THOMPSON, DEPUTY GENERAL COUNSEL; HON. CLAUDE [MICK] KICKLIGHTER, ASSISTANT SECRETARY FOR POLICY AND PLANNING/ACTING DIRECTOR, OFFICE OF OPERATIONS, SECURITY AND PREPAREDNESS; AND VINCE BARILE, DEPUTY UNDER SECRETARY FOR MANAGEMENT, NATIONAL CEMETERY ADMINISTRATION

Mr. MCCLAIN. I will endeavor to do it in 5 minutes.

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Mr. Chairman, thank you very much for inviting the Department to give you its views and comments on the many, many bills that are pending before this committee.

I, first of all, request that my full statement be inserted in the record at this point.

Chairman ROCKEFELLER. Absolutely.

Mr. MCCLAIN. Getting right to the point, the VA is pleased to lend its unqualified support for the following measures on today's agenda: S. 1113 and S. 2025, which would enhance pensions paid to Medal of Honor recipients; S. 1576, which would extend by 10 years our special treatment authority for Persian Gulf War veterans; S. 2043, extending by 5 years, the institutional and noninstitutional extended care authorities from the Millennium Act; and S. 2074, the Compensation COLA bill.

Mr. Chairman, we also very much appreciate your introducing three bills at our request and inviting testimony from the different witnesses today, including S. 1905 to authorize care for newborns of enrolled women veterans, dental care for all POWs, and for other provisions; S. 2229, which is the Departments' version of the Compensation COLA bill, but also includes a provision to revise the current requirement for maintaining levels of VA institutional extended care provided to veterans in accord with 1998 levels. We believe this proposal is essential if veterans are to retain options for receiving nursing home care in the manner and locale of their choice; and S. 2186, legislation in support of a new VA Assistant Secretary for Office of Operations, Security and Preparedness.

My prepared statement details our support for all of these bills, and it explains our support, also, for the Medical Emergency Preparedness Centers in S. 2132, and the State Approving Agency funding increases in S. 2231.

Regarding some of the other bills under consideration today, we do not believe there is adequate justification for the following bills, and the VA or the administration does not support their enactment.

First, is the beneficiary travel amendments in S. 984 and the pharmacy copayment amendments in S. 1408 because of their adverse impact on the resources for the provision of health care in the Department; the Montgomery GI bill amendments in S. 1517; the anti-assignment provisions of S. 2003; the specialized mental health services provision of S. 2044, which would require VA to fund these services outside our VERA equitable allocation model; the provisions of 2079 that would subject VA's rating schedule to vexatious litigation and fundamentally change the role of the Court of Appeals for Veterans Claims; revisions of the law governing nonprofit research corporations, as proposed in S. 2132; and the retirement annuity amendment in S. 2227.

Mr. Chairman, as to the other provisions and bills under discussion today, as our formal written statement provides, VA either does not object or does not yet have VA or administration positions on the bills. We will be providing views on those bills in writing in the very near future.

That completes my brief oral statement, and myself and my colleagues accompanying me would be glad to answer any questions that you or the panel might have.

[The prepared statement of Mr. McClain follows:]

PREPARED STATEMENT OF TIM MCCLAIN, GENERAL COUNSEL, DEPARTMENT OF VETERANS AFFAIRS

Mr. Chairman and Members of the Committee:

Thank you for the opportunity to testify today on a number of legislative items of interest to veterans.

S. 984

This bill would increase the beneficiary travel mileage rates to reimbursement rates (applicable to privately owned vehicles) established by the General Services Administration (GSA). It would also include a new group of veterans among those entitled to beneficiary travel benefits under 38 U.S.C. §111, specifically veterans whose travel is in connection with treatment for a non-service connected disability at a non-VA facility, if the treatment is recommended by VA medical personnel at a facility that is not able to provide the recommended treatment.

VA does not support S. 984. While VA's reimbursement rates are less than those established by GSA, any increase would decrease funds available for direct medical care. It is estimated that an increase in beneficiary mileage reimbursement rates to GSA's level of 36.5 cents would cost approximately $97 million that would have to come from medical care funding. Even a modest increase of 5 cents per mile would cost approximately $20 million. We cannot support diminishing VA's capacity to provide direct patient care to provide an added benefit to the very limited groups of veterans eligible for travel reimbursement benefits.

S. 1113 AND S. 2025

Both of these bills would enhance the special pension paid by VA to those who have been awarded the Congressional Medal of Honor, by increasing the monthly benefit to $1,000 (it is currently $600) and indexing the rate to annual increases in the cost of living. S. 2025 would, in addition, provide that the special-pension eligibility shall commence on the first day of the month beginning after the date of the act for which an individual is awarded the Medal of Honor. Currently, the period of eligibility does not begin until after the military service concerned certifies to VA that the Medal of Honor has been awarded and the recipient applies for the pension. Under S. 2025, all individuals in receipt of the special pension on the date of enactment would be entitled to lump-sum payments representing the additional amounts of pension that would have been payable had they been eligible from the first of the month following the acts for which they received the medals. We note that as of March 2002, there were only 143 Medal of Honor recipients drawing the special pension.

Last October we notified the Committee that we favor an increase of the monthly payments to $1,000 and the indexing of the rate, as provided in S. 1113. We also support the earlier effective dates for the awards called for in S. 2025. We are aware of situations in which there have been lengthy delays—through no fault of the recipients in the awarding of Medals of Honor. The proposed effective-date amendment would be more equitable than current law, which bases periods of eligibility on when the Government acts to award Medals of Honor. We believe, however, there may be an internal inconsistency in the language of sections 2(a) and 2(c) of S. 2025 concerning the calculation of retroactive payments which we do not believe was intended. We would be pleased to work with the Committee staff to revise the bill to correct this technical problem. We would defer to the views of the Department of Justice regarding the merits of the criminal-law amendments in S. 2025.

These proposals would increase direct spending; therefore, they are subject to the pay-as-you-go (PAYGO) provisions of the Omnibus Budget Reconciliation Act of 1990. We estimate the PAYGO costs associated with enactment of the rate increases in either S. 1113 or S. 2025 to be $670,000 for FY 2003, $3.2 million for the fiveyear period FY 2003 through FY 2007, and $6.1 million for the 10-year period FY 2003 through FY 2012. We have not yet estimated the costs of the effective-date amendment in S. 2025.

S. 1408

This bill would increase the income threshold used to define the group of low-income veterans who are exempted from paying the outpatient pharmacy co-payment. The exempted group would be expanded to include veterans who, for purposes of receiving VA health care, are deemed unable to defray necessary expenses of care, i.e., those with incomes below VA's "means-test" threshold. A provision of the bill

would also prohibit the Secretary from increasing the pharmacy co-payment until VA begins collecting co-payments for outpatient care.

Currently, the low-income exemption applies only to those veterans whose incomes do not exceed the maximum annual rate of pension payable under 38 U.S.C. § 1521 were they eligible for such pension. This is a much smaller group composed of very low-income veterans. Although VA appreciates the desire to standardize the definition of "low-income" veteran for purposes of both health care eligibility and the pharmacy co-payment exemption, VA cannot support S.1408. The proposal would significantly reduce much-needed revenue upon which the Department relies to continue providing services. We also recommend deletion of the provision deferring increases in the amount of the pharmacy co-payment. VA is already implementing new regulations pertaining to both the pharmacy co-payment and the outpatient copayment.

We estimate the PAYGO costs of S. 1408 to be $300 million dollars annually.

S. 1517

S. 1517 would enhance certain aspects of the Montgomery GI Bill (MGIB). Specifically, the bill would amend the chapter 30 MGIB-Active Duty program by eliminating both the $1200 pay reduction currently required to participate in the chapter 30 MGIB program and the election required of those who choose not to participate. The Administration does not support this proposal.

S. 1517 would also add a new category of individuals under the chapter 30 program who would be entitled to transfer their entire entitlement or a portion of it to one or more of their dependents. Under this provision, individuals with not less than 15 years of active duty service would become eligible to transfer MGIB education benefits. While this provision would have significant PAYGO costs, our PAYGO estimate is still under development. Since this proposal does not support the readjustment goals of the MGIB, the Administration does not concur in its en

actment.

S. 1517 also would extend the time limitation for using an individual's chapter 30 MGIB entitlement from 10 years after the date of discharge or release from active duty to 20 years. In like manner, it would provide for a 20-year delimiting period for members of the MGIB-Selected Reserve as well. The Administration does not support these provisions. In our view, extending the 10-year period is not consistent with the stated purposes of the MGIB. We believe that 10 years is sufficient time for most individuals to make the readjustment from military to_civilian life. Finally, S. 1517 would provide for increased MGIB education benefits for those members of the Selected Reserve who are called to active duty for more than one year for a contingency operation. The Administration also does not support this proposal.

S. 1561

This bill would authorize $2 million for fiscal year 2002 and such sums as may be needed for each subsequent fiscal year for VA to continue its efforts in responding to, and training of VA and other health-care professionals for, the medical consequences of bio-terrorism.

We support increasing VA's efforts in the area of emergency medical preparedness. However, we believe that the objectives of this legislation should be addressed in the context of other measures being considered that address VA's role in bio-terrorism preparedness. VA's current funding in these areas is appropriated in the Department of Health and Human Services budget for reimbursement to VA, in order to ensure close coordination. The Homeland Security Council is currently evaluating the distribution of resources and effort of each agency in the context of a national strategy.

S. 1576

S. 1576 would extend through December 31, 2011, VA's special authority to treat Gulf War veterans for any disability, notwithstanding there is insufficient medical evidence to conclude that such disability may be associated with such service. That authority will expire after December 31, 2002. VA supports this proposal.

S. 1680

S. 1680 would amend the Soldiers' and Sailors' Civil Relief Act of 1940 (SSCRA) to treat certain National Guard duty as military service under that Act. This legislation would enable National Guard members who are called or ordered to service by their governor in support of Operation Enduring Freedom, or at the request of the