BILL ANALYSIS Ó
AB 1596
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Date of Hearing: April 12, 2015
ASSEMBLY COMMITTEE ON VETERANS AFFAIRS
Jacqui Irwin, Chair
AB 1596
(Mathis) - As Amended March 28, 2016
SUBJECT: Veteran service organizations
SUMMARY: This bill appropriates $3,000,000 from the General
Fund to the Department of Veterans Affairs (CalVet) for the
purpose of grants to veterans service organizations (VSOs).
Specifically, this bill:
Requires CalVet to establish criteria for any VSO it contracts
with and reporting requirements regarding any funds distributed
through those contracts.
Refines the definition of veteran service organization under
Military and Veterans Code section 699.5(e)(3)(d) to require
that a VSO must have regularly maintained an established
committee or agency in a regional office of the United States
Department of Veterans Affairs (USDVA) in California rendering
services to veterans and their dependents and survivors for at
least the past five years.
Requires the VSO to have had an active statewide California
organization with a presence in the state and be registered with
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the Secretary of State and the Attorney General.
Appropriates three million dollars ($3,000,000) from the General
Fund to the department, without regard to fiscal years, for the
purpose of grants and contracts pursuant to Section 699.5 of the
Military and Veterans Code, to be awarded over a five-year
period beginning with the 2017-18 fiscal year.
EXISTING LAW: Contains a grant of authority to CalVet to
contract with VSOs under specified circumstances and defines
VSO.
FISCAL EFFECT: Unknown at this time, however the bill does
contain an appropriation of $3,000,000.
COMMENTS: In California, many veterans' get connected to any
veterans benefits for which they are eligible through a County
Veteran Service Officer (CVSO). CVSOs are funded in part
(currently a total of approximately $5.6 million shared among
all 58 counties) by the state. California relies heavily on
the CVSOs to reach and serve the approximately 1.8 million
California veterans. (CalVet has a very small number of state
employees that assist veterans with claims.) Though veterans
are able to file claims themselves, staff is informed that due
to the complexity of the claims process it is rarely advisable
for veterans to self-file.
In California and throughout the country, in addition to CVSOs
or their equivalent state government counterparts, VSOs assist
veterans in filing claims. VSOs are not government entities,
they are private, non-profit organizations that serve and
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advocate for veterans. Many VSOs have decades, if not over a
century, of history serving veterans.
The state partially funds the work of CVSOs and relies heavily
on CVSOs to support veterans in connecting to benefits. This
structure inherently creates some tension between the state and
the counties about the appropriate level of state oversight and
control. CVSOs are county, not state employees and as such the
state's ability to manage their performance is at best indirect.
However, the strategy of combining state funding with local
government employment and control of key veterans staff takes
into account the great diversity of the state in terms of
resources, veteran population, and other factors and allows
local governments to tailor their efforts using their knowledge
of the locality. Some of the tension in the relationship is
managed through statutes and regulations which clarify the
requirements for CVSO participation in the state subvention and
the respective responsibilities of CalVet and the CVSO.
This bill would create an additional source of support for
veterans filing claims, the VSOs, with their existing networks,
knowledge, and experience. However, should the state add VSOs
to its strategy to assist veterans in connecting to their
benefits, that relationship is likely to have similar challenges
as that between the state and CVSOs.
In addition to the appropriation the bill adds some language to
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the definition of VSO under Military and Veterans Code section
699.5(e)(3). The current language in code states:
(3) "Veterans service organization" means an organization
that meets all of the following criteria:
(A) Is formed by and for United States military veterans.
(B) Is chartered by the United States Congress.
(C) Has regularly maintained an established committee or
agency in a regional office of the United States Department
of Veterans Affairs in California rendering services to
veterans and their dependents and survivors.
It is the perceived intent of the existing code definition to
set a minimum level of experience, legitimacy, and presence in
California. The elements of this definition trace back to at
least to 1993 and prior versions of this code section. The
context is important because, due to the conflicts in Iraq and
Afghanistan, a whole new generation of veterans has arisen and
the landscape of veteran service organizations has changed. It
is unclear if the existing language or the proposed additions
achieve the perceived intent. Further, the existing code may be
overly restrictive and the proposed additions may enhance the
restriction further.
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Congressional Charter:
There are only 42 congressionally chartered VSOs, total, in the
entire United States. The most recent charter for a VSO was
granted seven years ago, in 2009. Granting of Congressional
Charters is still possible, but rarely done. In addition, the
Congressional Research Service (Congressionally Chartered
Nonprofit Organizations ("Title 36 Corporations"): What They Are
and How Congress Treats Them, 2004") noted that the reason for
the curtailment of Congressional Charters was:
Chartered corporations listed in Title 36 are not agencies of
the United States, and the charter does not assign the
corporate bodies any governmental attributes. For instance,
the corporation's debt is not guaranteed, explicitly or
implicitly, by the full faith and credit of the United States.
The attraction of Title 36 status for national organizations
is that it tends to provide an "official" imprimatur to their
activities, and to that extent it may provide them prestige
and indirect financial benefit. In recent years, some in
Congress have expressed concern that the public may be misled
by its chartering process into believing that somehow the U
.S. government approves and supervises the corporations, when
in fact this is not the case. As a consequence, in 1989 the
House Judiciary Committee decided upon a moratorium on
granting new charters.
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Five-Year USDVA Regional Office (VARO) Co-Location Requirement:
The bill includes a new requirement that the VSO must have had
its "committee or agency office" for at least the past five
years. The following VSOs currently have co-located offices in a
VARO (It is unknown how many of these 9 organizations have had
offices in the VARO for the past five years.):
1.American Legion
2.AMVETS
3.Disabled American Veterans
4.Military Order of the Purple Heart
5.Veterans of Foreign Wars
6.American Ex-POWs
7.Blinded Veterans Association
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8.Paralyzed Veterans of America
9.Vietnam Veterans of America
This is a very small pool of potential contract recipients and
almost certainly bars many experienced and legitimate VSOs.
Finally, the bill also adds a requirement that the VSO must have
an "active statewide California organization with a presence in
the state." The term "active statewide California organization
with a presence in the state' is vague and might be hard to
prove/define.
Proposed Policy Questions for Members:
1)Should the state expand claims support to veterans?
2)Should the state expand claims support to veterans in any of
the following ways:
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a) Through enhanced funding for CVSOS?
b) Through a new program of contracting with VSOs as
proposed?
c) Through funding CalVet Joint Claims Initiative (Strike
Team) or other CalVet staff?
3)Should the definition of VSOs eligible for contracting with
CalVet as specified in the bill be so narrow that only 9 or
fewer VSOs are eligible?
4)CVSOs, in order to participate in the state subvention through
CalVet, must comply with certain process and procedural
requirements that allow CalVet to administer the subvention
and account for the expenditure of state funds. If CalVet
contracts with VSOs for claims services, should VSOs meet
substantially similar process and procedure requirements as
CVSOs do?
Staff recommends the following amendments:
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Amendment 1 : Military and Veterans Code section 699.5(b)
The department shall, by June 1, 2017, prescribe policies,
procedures, rules and regulations necessary to implement this
section, including but not limited to:
(1) VSO operational requirements such as data-reporting
systems, the maintenance of financial records, and a data
collection system that provides documentation and
justification for contracted activities;
(2) VSO eligibility requirements which shall consider factors
including, but not limited to: history of the VSO's service to
veterans, accreditation requirements, maintenance of offices
in a VARO and statewide, congressional charter, and
registration with the Secretary of State and the Attorney
General; and
(3) Contract audit procedures.
Amendment 2 : Delete Military and Veterans Code section
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699.5(e)(3)
REGISTERED SUPPORT / OPPOSITION:
Support
American G.I. Forum of California (Sponsor)
AMVETS- Department of California (Sponsor)
American Legion- Department of California (Sponsor)
VFW- Department of California (Sponsor)
Vietnam Veterans of America, California State Council (Sponsor)
California Association of County Veteran Service Officers
California State Commanders Service Council
Military Officers Association- California Council of Chapters
County of Ventura
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Opposition
None on File.
Analysis Prepared by:John Spangler / V.A. / (916) 319-3550