In these tight budget times, the Senate Veterans Affairs Committee has learned it must cut current spending to fund new initiatives for veterans.
For example, U.S. Sen. Patty Murray, D-Wash., committee chairman, would pay for her Hiring Heroes Act of 2011 (S 951) by extending by three years, to 2014, a higher fee on veterans who reuse their VA home loan authority. So the committee agreed that the current fee of 3.3 percent for "subsequent" home loan usage, set to fall to 2.15 percent Oct. 1, should only fall now to 3.0 percent.
The full Congress would have to agree to that.
Likewise, to pay for the Senate version of a bill to repair a glitch in last December's Post-9/11 GI Bill Reform Act so it doesn't lower benefits for at least 4,000 students enrolled in private colleges across seven states, U.S. Sen. Charles Schumer, D-N.Y., got committee agreement to extend higher fees on VA home loans with 5 perent or 10 percent down payments, by three years and one year respectively. The fees in question are 1.5 percent for loans with 5 percent down payments and 1.25 percent for 10 percent.
But another tradeoff agreed to last week will anger base shoppers.
To free up billions of dollars for the cost of providing VA health care to veterans and family members exposed to contaminated water over three decades at Camp Lejeune, N.C., U.S. Sen. Richard Burr, R-N.C., won approval, without debate, to consolidate all base exchanges and commissary operations worldwide into a single for-profit retailing system.
The Congressional Budget Office floated a similar deficit-reduction idea last January, projecting savings to the Department of Defense of $200 million the first year after consolidation and $9.1 billion over the first 10 years.
A large part of the savings is derived from reducing the value of commissary shopping where groceries now are sold at cost plus a small surcharge.
Burr spokeswoman Chandler Smith said Burr's store consolidation plan would be different, but she could not provide full details.
"No, this is not the same plan," Smith said. "Senator Burr intends for DoD to merge duplicative management functions without impacting service delivery for personnel and families. The potential cost savings in the first year would be $267 million."
The Congressional Budget Office plan would have softened the effect of selling food at exchange prices by phasing in a tax-free grocery allowance for service members. Exchanges, or base department stores, earn profit on items sold and the profits then are used to fund base morale, welfare and recreational activities such as gyms and libraries.
The budget office estimated that base shoppers would pay 7 percent more for groceries under a consolidated system. Burr's bill would need only half of the budget office's projected savings to cover care of the ill Camp Lejeune veterans.
During a mark-up hearing on six bills previously considered by the veterans' committee, the Caring for Camp Lejeune Veterans Act (S 277) sailed through with unanimous support and no discussion over Burr's late-hour plan to pay for it. The bill would extend health services to Marine Corps and Navy veterans and family members assigned to Lejeune sometime from 1957 to 1987, a period when water there was contaminated by "volatile organic compounds including known carcinogens and probable carcinogens," explained the committee's short summary of the bill.
But one Senate source, upset by Burr's funding plan, said it likely would mean an end to the annual $1.3 billion subsidy of commissary operations and, therefore, "do away with commissaries as we know it."
The bill would direct VA to provide the care to Lejeune veterans and families but collect those costs from DoD. Burr estimates the size of the potential population at 600,000 but VA officials said it's one million, and total costs over the next a decade could reach $4.1 billion.
VA opposes Burr's bill, citing inadequate scientific evidence so far to assess levels of exposure or to confirm what health conditions it caused.
A few weeks ago funding seemed to be its biggest hurdle. The Obama administration and congressional leaders continue to seek ways to slash federal spending and lower the nation's $14 trillion debt. No new entitlement programs can be launched unless lawmakers find offsets in current direct spending programs. Burr and staff struggled to do so for the Lejeune veterans and finally settled on ordering DoD to consolidate base stores.
The bill is being filed for consideration of the full Senate. But the Senate Armed Services Committee is expected to request "sequential referral" of the bill so that its members can weigh the merits of consolidating the store system. The armed services committee has oversight responsibility for all matters under the Department of Defense. If sequential referral doesn't occur because it needs the unanimous consent of the Senate, opponents will try to derail Burr's funding scheme through floor amendment.
Commissary and exchange consolidation "is not something we would support," said Steve Strobridge, director of government relations for Military Officers Association of America. "And certainly not without going through the armed services committee. I hope it gets the kind of scrutiny it deserves."