Panel seeks answers on VA cuts

Defense Secretary Leon Panetta and Veterans Affairs Secretary Eric Shinseki are set to testify on Capitol Hill on Wednesday about the steps they’re taking to work better together.

Instead, they’ll likely be peppered with questions from members of the House Veterans Affairs Committee on whether the VA is completely exempt from sequestration spending cuts.

“For nearly a year now, America’s veterans have been held in limbo due to this administration’s overt prerogative to play politics with sequestration,” said Committee Chairman Jeff Miller (R-Fla.). “Exempting veterans’ funding from sequestration was crystal clear last August to members of Congress – and, yet, we still have not received a definitive answer from the administration on whether or not VA will be subject to cuts.”

“Conveniently this week,” Miller pointed out, “the president declared ‘veterans’ benefits’ are exempt in a speech before a group of veterans, but his own acting OMB (Office of Management and Budget) director, Jeffrey Zients, has stated that VA may face sequestration under current law. Which is it?”

Miller said he was determined to “get an answer once and for all and assure our veterans they are still a priority to this nation.”

The Budget Control Act of 2011 laid out a doomsday scenario of an additional $1.2 trillion in spending cuts over 10 years across all government agencies, beginning on Jan. 2, unless Congress acts to stave it off.

The Defense Department is staring down a $500 billion hit, but the VA breathed a sigh of relief when OMB said the department would be exempt.

Back in April, OMB released a letter saying sequestration would not affect the VA, which has been flooded with new veterans after more than a decade of war in Iraq and Afghanistan.

“The conclusion that we have reached is that all programs administered by the VA, including veterans’ medical care, are exempt from sequestration,” the OMB said then.

Still, the committee was confused by this assertion: “We do not address other potential sequester questions under the BBEDCA [Balanced Budget and Emergency Deficit Control Act of 1985], the PAYCO Act [The Statutory Pay-As-You-Go Act of 2010], and the BCA [Budget Control Act], including the application to VA programs of the ‘Federal Administrative Expenses’ sequester provision at Section 256(h) of BBEDCA.”

The letter is referring to other programs and legislation that help fund the VA that could take a hit if sequester is enacted, though that cut would be no more than 2 percent.

In a response to an inquiry in May by Sen. Patty Murray (D-Wash.), chairwoman of the Senate Veterans Affairs Committee, the Government Accountability Office also noted that “administrative expenses incurred in connection with VA programs may be subject to sequestration. The execution and impact of any spending reductions will depend on the legal interpretations and actions taken by the Office of Management and Budget, which is vested with implementing the Budget Control Act.”

In a June 15 letter to the House committee, Zientz referred the committee again to the April letter and said Congress could avoid this confusion and uncertainty by getting to work on a debt-reduction plan.

“More than six months remain before the sequester is scheduled to take effect, and Congress has ample time to act to avoid it,” Zeints wrote. “Should it become necessary, the administration will be ready to implement the sequester as prescribed by the BCA (Budget Control Act). However, now is the time for Congress to enact bipartisan, balanced deficit reduction legislation that the president can sign into law and avoid the sequestration.”

Asked by POLITICO to clarify whether the VA is completely exempt from sequester, an OMB spokeswoman also referred back to the April letter.  

Posted to: Federal Government Military Politico

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