BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                     AB 171


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          Date of Hearing:  March 10, 2015


                       ASSEMBLY COMMITTEE ON VETERANS AFFAIRS


                                    Irwin, Chair


          AB  
                     171 (Irwin) - As Introduced  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:

             a)   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.









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             b)   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.

             c)   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  :   








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          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 









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          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:








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          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

















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