Order Code RL34038
Military Construction, Veterans Affairs, and
Related Agencies: FY2008 Appropriations
June 12, 2007
Daniel H. Else
Specialist in National Defense
Foreign Affairs, Defense, and Trade Division
Christine Scott
Specialist in Tax Economics
Domestic Social Policy Division
Sidath Viranga Panangala
Analyst in Social Legislation
Domestic Social Policy Division

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The annual consideration of appropriations bills (regular, continuing, and
supplemental) by Congress is part of a complex set of budget processes that also
encompasses the consideration of budget resolutions, revenue and debt-limit legislation,
other spending measures, and reconciliation bills. In addition, the operation of programs and
the spending of appropriated funds are subject to constraints established in authorizing
statutes. Congressional action on the budget for a fiscal year usually begins following the
submission of the President’s budget at the beginning of each annual session of Congress.
Congressional practices governing the consideration of appropriations and other budgetary
measures are rooted in the Constitution, the standing rules of the House and Senate, and
statutes, such as the Congressional Budget and Impoundment Control Act of 1974.
This report is a guide to one of the regular appropriations bills that Congress considers
each year. It is designed to supplement the information provided by the House Military
Quality of Life and Veterans Affairs and Senate Military Construction and Veterans Affairs
Appropriations Subcommittees. It summarizes the status of the bill, its scope, major issues,
funding levels, and related congressional activity, and is updated as events warrant. The
report lists the key CRS staff relevant to the issues covered and related CRS products.
NOTE: A Web version of this document with active links is
available to congressional staff at
[http://beta.crs.gov/cli/cli.aspx?PRDS_CLI_ITEM_ID=2349].

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Military Construction, Veterans Affairs, and Related
Agencies: FY2008 Appropriations
Summary
The House introduced its version of the FY2008 Military Construction,
Veterans Affairs, and Related Agencies appropriations bill, H.R. 2642, on June 11,
2007. House action on the bill is scheduled for June 13. The Senate subcommittee
and committee markup on its version of the bill is expected within the week.
The President submitted his FY2008 appropriations request to Congress on
February 5, 2007, including $105.2 billion for programs covered in this
appropriations bill: $21.2 billion for Title I (military construction and family
housing); $83.9 billion for Title II (veterans affairs); and $163 million for Title III
(related agencies). With no regular appropriation passed or enacted for FY2007, this
must be compared with the combined totals of the subsequent continuing resolutions
and emergency supplemental appropriations: $17.9 billion for Title I; $79.6 billion
for Title II; and $149 million for Title III. The request represents an increase of $3.2
billion (18.0%) in Title I, $4.4 billion (5.5%) in Title II, and $14 thousand (9.2%) in
Title III above the FY2007 enacted appropriations. The overall FY2008 request
exceeds the FY2007 appropriations by $7.6 billion, an increase of 7.8%.
While the general appropriations request for Title I activities has increased
above FY2007, this increase has not occurred across all appropriations accounts.
Funds for armed forces reserve components and for military family housing requested
in FY2008 are less than those enacted for FY2007, while requested construction
funding for the active Army, Navy, Marine Corps, and Air Force and appropriations
for Base Realignment and Closure (BRAC) actions exceed the currently enacted
amounts. Much of this addition can be attributed to the recently authorized increase
in end-strength of military ground forces and the onset of construction required by
the 2005 BRAC round.
In the area of veterans’ non-medical benefits, mandatory spending is increasing
as claims for disability compensation, pension, and readjustment benefits increase
due to a combination of several factors including the aging of the veterans population
and the current conflicts in Iraq and Afghanistan. As a result of the increase in the
number of claims, the average processing time for a disability claim in FY2006 was
177 days. To reduce the pending claims workload and improve the claims processing
time, funds were provided in the FY2007 supplemental and in the FY2008
appropriation for hiring and training additional claims processing staff. While
mandatory spending has increased by 19.6% between FY2006 and FY2008 (from
$37.2 billion to $44.5 billion), mandatory spending has declined as a share of the
total VA appropriation (from 52.1% in FY2006 to 50.7% in FY2008).
In terms of medical care afforded to veterans, similar to the past five years, the
Administration has included several cost sharing proposals including increase in
pharmacy copayments and enrollment fees for lower priority veterans. The House
Appropriations Committee draft bill provides $37.1 billion for VHA for FY2008 ,
a 9.1% increase over the FY2007 enacted amount of $34.0 billion, and 7.3% above
the President’s request of $34.6 billion. The draft bill does not include any
provisions that would give VA the authority to implement fee increases. This report
will be updated as events warrant.

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Key Policy Staff for Military Construction, Military Quality of Life,
and Veterans Affairs Appropriations
Area of
Name
Telephone
E-Mail
Expertise
Acquisition
Valerie Bailey Grasso
7-7617
vgrasso@crs.loc.gov
Stephen H. Chadwick
7-8983
schadwick@crs.loc.gov
Base Closure
Daniel H. Else
7-4996
delse@crs.loc.gov
Defense Budget
Stephen Daggett
7-7642
sdaggett@crs.loc.gov
Amy Belasco
7-7627
abelasco@crs.loc.gov
Health Care;
Richard A. Best, Jr.
7-7607
rbest@crs.loc.gov
Military
Military
Daniel H. Else
7-4996
delse@crs.loc.gov
Construction
Military
David F. Burrelli
7-8033
dburrelli@crs.loc.gov
Personnel
Charles A. Henning
7-8866
chenning@crs.loc.gov
Military
David F. Burrelli
7-8033
dburrelli@crs.loc.gov
Personnel;
Charles A. Henning
7-8866
chenning@crs.loc.gov
Reserves
Related Agencies
Daniel H. Else
7-4966
delse@crs.loc.gov
Veterans Affairs
Christine Scott
7-7366
cscott@crs.loc.gov
Veterans Affairs;
Sidath Viranga
7-0623
spanangala@crs.loc.gov
Healthcare
Panangala

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Contents
Most Recent Developments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Status of Legislation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Summary and Key Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Appropriations Subcommittee Jurisdiction Realignment, 110th Congress . . 2
Appropriations for Fiscal Year 2007 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Continuing Resolutions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
FY2007 Emergency Supplemental Request for the Global War on
Terror . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
U.S. Troop Readiness, Veterans Care, Katrina Recovery, and
Iraq Accountability Appropriations Act, 2007 (H.R. 1591 and
H.R. 2206) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Fiscal Year 2008 Appropriations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Title I: Department of Defense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Military Construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Key Budget Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Base Realignment and Closure/Integrated Global Presence and
Basing Strategy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
“Growing the Force” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Overseas Initiatives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Title II: Department of Veterans Affairs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Agency Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Key Budget Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Medical Care . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Title III: Related Agencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
American Battle Monuments Commission . . . . . . . . . . . . . . . . . . . . . . . . . 12
U.S. Court of Appeals for Veterans Claims . . . . . . . . . . . . . . . . . . . . . . . . . 12
Department of Defense - Civil (Army Cemeterial Expenses) . . . . . . . . . . . 13
Armed Forces Retirement Home (AFRH) . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Appendix A. Consolidated Non-VA Funding Tables . . . . . . . . . . . . . . . . . . . . . 15
Appendix B. Additional Resources . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Budget . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Selected Websites . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

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List of Tables
Table 1a. Status of FY2008 Military Construction, Veterans Affairs, and
Related Agencies Appropriations (H.R. 2642) . . . . . . . . . . . . . . . . . . . . . . . 2
Table 1b. Status of FY2008 National Defense Authorization
(H.R. 1585, S. 1549) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Table 2. Department of Veterans Affairs Appropriations, FY2001-FY2007 . . . . 7
Table 3. Appropriations: Department of Veterans Affairs, FY2006-FY2008 . . . 7
Table 4. Appropriations: Related Agencies, FY2006-FY2008 . . . . . . . . . . . . . . 13
Table 5. DOD Military Construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

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Military Construction, Veterans Affairs, and
Related Agencies:
FY2008 Appropriations
Most Recent Developments
The House Committee on Appropriations Subcommittee on Military
Construction, Veterans Affairs and Related Agencies marked its draft of the
appropriations bill on May 22, 2007, recommending a total Fiscal Year 2008
appropriation of $109.2 billion. The full Committee marked the bill on June 6.
Representative Chet Edwards, chair of the subcommittee, introduced the bill on June
11 (H.R. 2642, H.Rept. 110-186). Floor action is scheduled for June 13. Senate
appropriations subcommittee markup is expected on June 13, with full committee
markup scheduled for June 14, 2007.
Military construction appropriation authorization is effected in the annual
National Defense Authorization Act. The House passed its version of the bill (H.R.
1585, H.Rept. 110-146 and 110-146, Part II) on May 17, 2007. It was received in the
Senate on June 5. The Senate Committee on Armed Services introduced its bill (S.
1547, S.Rept. 110-77) on June 5.1 The Senate is expected to take up the authorization
bill later in June.2
1 The Senate committee usually introduces several related defense authorization bills, a
general authorization and one each to authorized military activities, military construction,
and defense activities of the Department of Energy. S. 1549, the Military Construction
Authorization Act for Fiscal Year 2008, was introduced on June 5, 2007. An umbrella bill,
S. 1547, the National Defense Authorization Act for FY2008, includes military construction
as its Division B (Military Construction Authorizations) and was introduced the same day,
and it is this bill that will be tracked in this report.
2 For details on the FY2008 defense authorization, see CRS Report RL33999, Defense:
FY2008 Authorization and Appropriations, by Pat Towell, Stephen Daggett, and Amy
Belasco.

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CRS-2
Status of Legislation
Table 1a. Status of FY2008 Military Construction, Veterans
Affairs, and Related Agencies Appropriations (H.R. 2642)
Conference Report
Committee Markup
House
House
Senate
Senate
Conf.
Approval
Public
Report
Passage
Report
Passage
Report
Law
House
Senate
House
Senate
H.Rept.
6/6/07
—
—
—
—
—
—
—
—
110-186
Table 1b. Status of FY2008 National Defense Authorization
(H.R. 1585, S. 1549)
Conference Report
Committee Markup
House
House
Senate
Senate
Conf.
Approval
Public
Report
Passage
Report
Passage
Report
Law
House
Senate
House
Senate
H.Rept.
5/9/07
—
5/17/07
—
—
—
—
—
—
110-146
Summary and Key Issues
Appropriations Subcommittee Jurisdiction Realignment,
110th Congress
With the opening of the 110th Congress, the House and Senate brought the
responsibilities of their appropriations subcommittees more closely into alignment.
On the House side, this resulted in a new alignment of jurisdictions and the renaming
of several subcommittees.
Non-construction quality-of-life defense appropriations that had been considered
in the House version of this appropriations bill during the 109th Congress, including
Facilities Sustainment, Restoration, and Modernization, Basic Allowance for
Housing, Environmental Restoration, and the Defense Health Program, were
transferred to the jurisdiction of the House Committee on Appropriations
Subcommittee on Defense. The former Subcommittee on Military Quality of Life,
Veterans Affairs, and Related Agencies became the Subcommittee on Military
Construction, Veterans Affairs, and Related Agencies, mirroring its counterpart in
the Senate.
Appropriations for Fiscal Year 2007
Continuing Resolutions. The 109th Congress was unable to pass H.R. 5385,
the Military Construction, Military Quality of Life, and Veterans Affairs
Appropriations Act for Fiscal Year 2007. In the absence of an annual appropriation,

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CRS-3
Fiscal Year 2007 funding for all of the accounts included in that bill was sustained
by a series of continuing resolutions that spanned the final weeks of the 109th
Congress and the initial weeks of the first session of the 110th Congress. Div. B of
H.R. 5631 (P.L. 109-289), the Department of Defense Appropriations Act for Fiscal
Year 2007, continued appropriations for a variety of activities, including those
covered by H.R. 5385, from the beginning of Fiscal Year 2007 through November
16, 2006, using various formulas.3 In general, these equated to the lowest of the
House-passed, Senate-passed, or last-enacted funding levels.
H.J.Res. 100 (P.L. 109-369) continued appropriations through December 18,
2006.
H.J.Res. 102 (P.L. 109-383) continued appropriations through February 15,
2007.
H.J.Res. 20 (P.L. 110-5) was passed by the 110th Congress and enacted on
February 15, 2007. It incorporated the previous continuing resolutions and extended
them, with some modification to military construction and veterans benefits, through
the end of Fiscal Year 2007 (September 30, 2007).
Additional information regarding the recent history of and practices regarding
continuing resolutions can be found in CRS Report RL30343, Continuing
Appropriations Act: Brief Overview of Recent Practices, by Sandy Streeter, and CRS
Report RL32614, Duration of Continuing Resolutions in Recent Years, by Robert
Keith.
FY2007 Emergency Supplemental Request for the Global War on
Terror. As part of his Fiscal Year 2008 Budget Request, President George W. Bush
included a recommendation for an additional $93.4 billion emergency supplemental
appropriation to support what the Administration terms the Global War on Terror
(GWOT). As stated in the Fiscal Year 2008 Budget Appendix (Additional FY2007
and FY2008 Proposals), the included military construction funds would be “used to
build urgent facilities needed for the Global War on Terror, including buildings,
perimeter fences and barriers, secure fuel facilities, and roads to improve the force
protection and safety of U.S. military forces. The funds would also be used to
construct theater-located operations facilities needed to improve the capabilities of
combat forces. In addition, the funds would cover the cost of housing, maintenance,
and training infrastructure needed to support an expansion of Army and Marine
Corps ground combat forces.”4
This supplemental request asked to add $1.38 billion to the FY2007 Army
military construction account, $412.5 million to the FY2007 Navy and Marine Corps
military construction account, and $60.2 million to the FY2007 Air Force military
construction account.
3 See Div. B, Sec. 101(b) — (e) of the act.
4 The quotation is taken from pg. 1161. The appendix is available on the World Wide Web
at [http://www.whitehouse.gov/omb/budget/fy2008/].

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CRS-4
Supplementary budget documentation forwarded by DOD distributed the
funding along three main functions: “Continuing the Fight,” “Reconstituting the
Force,” and “Enhancing Ground Forces.” Military construction was included in the
first and the last of these.
Under “Continuing the Fight,” DOD indicated that approximately $980.0
million would be devoted to the construction and improvement of facilities in Iraq
and Afghanistan in direct support of ground force military operations. The Navy
would spend $85.1 million for facilities in Djibouti and at Naval Station
Guantanamo, Cuba, and the Air Force would use $60.2 million to improve airfield
facilities in Afghanistan.
Approximately $100 million of military construction under “Enhancing Ground
Forces”was intended to accelerate the transition of existing Army and Marine units
into two Brigade Combat Teams (Army) and a single Regimental Combat Team
(Marine). The remaining construction funding, approximately $729 million, would
build housing and maintenance and training facilities for 92,000 new troops to be
added to Army and Marine end strength by the end of 2012 (See “Growing the
Force” under Military Construction Key Budget Issues below).
U.S. Troop Readiness, Veterans Care, Katrina Recovery, and Iraq
Accountability Appropriations Act, 2007 (H.R. 1591 and H.R. 2206).
Representative David R. Obey, chair of the House Committee on Appropriations,
introduced an emergency supplemental bill (H.Rept. 110-60) on March 20, 2007. The
bill passed the House on Friday, March 23, and was received in the Senate on the
same day. It was laid before the Senate on the following Monday, March 26,
whereupon Senator Robert C. Byrd, chair of the Senate Committee on
Appropriations, offered the text of a similar bill, S. 965 (S.Rept. 110-37), as an
amendment in the nature of a substitute. Senate debate continued through March 29,
2007, when the chamber passed the bill with amendment and requested a conference.
The Conference Committee filed its report on April 24, 2007 (H.Rept. 110-107). The
amended H.R. 1591 passed both houses by April 26, and was presented to the
President on May 1, 2007. The President vetoed the bill.
Mr. Obey introduced a new bill (H.R. 2206) on May 8, 2007, that was passed
on May 10. The Senate passed an amended bill on May 17. A newly conferenced bill
was passed by both houses on May 24 and presented to the President the next day.
He signed it on May 25, 2007 (P.L. 110-28). Funding provided by the emergency
appropriation is noted in the tables located in Appendix A to this report.
One significant effect of this supplemental appropriation was its impact on
funding to implement the 2005 BRAC round. DOD had requested approximately
$5.6 billion in FY2007 to begin a number of construction projects in anticipation of
facility and troop movements. When the new fiscal year began on October 1, 2006,
these projects could not be initiated. The continuing resolution (H.J.Res. 20)
provided partial funding by appropriating $2.5 billion for BRAC 2005 activities. P.L.
110-28 appropriated the remaining $3.1 billion to fund BRAC to the originally
requested level.

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CRS-5
Fiscal Year 2008 Appropriations
Title I: Department of Defense
Military Construction
Military construction accounts provide funds for new construction, construction
improvements, planning and design, and host nation support of active and reserve
military forces and Department of Defense agencies. The North Atlantic Treaty
Organization Security Investment Program (NSIP) is the U.S. contribution to defray
the costs of construction (airfields, fuel pipelines, military headquarters, etc.) needed
to support major NATO commands. Family housing accounts fund new construction,
construction improvements, federal government costs for family housing
privatization, maintenance and repair, furnishings, management, services, utilities,
and other expenses incurred in providing suitable accommodation for military
personnel and their families where needed. The Chemical Demilitarization
Construction, Defense-Wide, account provides for the design and construction of
disposal facilities required for the destruction of chemical weapons stockpiles. The
Base Realignment and Closure Account 1990 funds the remaining environmental
remediation requirements (including the disposal of unexploded ordnance) arising
from the first four base realignment and closure (BRAC) rounds (1988, 1991, 1993,
and 1995). The Base Realignment and Closure Account 2005 provides funding for
the military construction, relocation, and environmental requirements of the
implementation of both the 2005 BRAC round and the DOD Integrated Global
Presence and Basing Strategy (military construction only).
Key Budget Issues
Several issues regarding military construction funding may be of interest to
some Members in their consideration of the Fiscal Year 2008 appropriation request.
Funding of the various accounts included under Title I (Department of Defense) is
listed in Table 5 of Appendix A to this report.
Base Realignment and Closure/Integrated Global Presence and
Basing Strategy. In its appropriations request for Fiscal Year 2007, DOD
estimated that the total one-time implementation between 2006 and 2011 of the 2005
BRAC round (the realignment and closure of a number of military installations on
United States territory) and the Integrated Global Presence and Basing Strategy (the
redeployment of 60,000 - 70,000 troops and their families from overseas garrisons
to bases within the United States) would cost $17.9 billion.
Between the submission of that request in February 2006 and submission of the
Fiscal Year 2008 BRAC funding request, DOD advanced its planning for the
execution of all military construction, movement of facilities, and relocation of
personnel necessary to carry out the approved recommendations of the 2005 BRAC

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CRS-6
Commission. This revision caused the estimate of one-time implementation cost to
rise to more than $26.4 billion.5
“Growing the Force”. DOD has recommended increasing the end strength
of the regular Army by 65,000 soldiers and Marine Corps by 27,000 Marines and the
Army National Guard and Army Reserves by an additional 9,200 citizen-soldiers
over the next five years. This will require additional military construction to
accommodate, train, and house these personnel and their families.
DOD has requested more than $3.7 billion in Fiscal Year 2007 emergency
supplemental and Fiscal Year 2008 military construction appropriations to support
this increase. The Congressional Budget Office has estimated that the additional
military construction cost between 2007 and 2013 of these soldiers and Marines will
total $15.7 billion, with the bulk of the appropriations required during Fiscal Years
2008-2010.6
Overseas Initiatives. While redeploying a number of troops to the United
States, DOD is renegotiating the location and garrisoning of a number of its
remaining overseas installations. These efforts are principally focused on the Federal
Republic of Germany, Italy, the Republic of Korea, and Japan. In addition, a number
of new, relatively austere, installations are being created in eastern Europe and in the
Pacific, Central, and Southern Command areas. Funding is being requested for the
construction of “enduring” sites in the Central Command area of responsibility
(Afghanistan and Djibouti). The House Committee on Appropriations noted that the
establishment of a new Africa Command (AFRICOM) may create the need for future
military construction on that continent.
In Germany, U.S. forces are continuing to consolidate at existing installations
in the south of the country, while the installation near Vicenza, Italy, is being
expanded in anticipation of the deployment of a modular brigade.
DOD and the Government of Japan have agreed to move approximately 8,000
Marines and 9,000 of their family members from bases on Okinawa to new facilities
in the U.S. territory of Guam. The construction costs associated with this move have
been estimated at $10 billion, and Japan has agreed to underwrite 60% of this
expense. The Departments of the Army, Navy, and Air Force have separately
initiated their own increase in presence on Guam, which is expected to add personnel
and family members to this total over the next several years.
U.S. forces in the Republic of Korea are in the process of shifting from sites
presence immediately along the Demilitarized Zone, at the frontier between that
nation and the Democratic People’s Republic of Korea (DPRK), and in a large
headquarters garrison in the capital of Seoul to expanded facilities further to the
south. While the bulk of construction cost will be borne by the Korean government,
5 Office of the Under Secretary of Defense (Comptroller), National Defense Budget
Estimates for FY 2008, Department of Defense, March 2007.
6 Letter from Peter R. Orszag, Director, Congressional Budget Office, to the Hon. Carl
Levin, Chairman, Senate Committee on Armed Services, April 16, 2007, p. 8.

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CRS-7
this initiative could require as much as $750 million in U.S. construction funding to
complete.
Title II: Department of Veterans Affairs
Table 2. Department of Veterans Affairs Appropriations,
FY2001-FY2007
(budget authority in billions)
FY2001
FY2002
FY2003
FY2004
FY2005
FY2006
FY2007
VA
$47.95
$52.38 $58.10 $61.84
$65.84
$71.46 $79.55
Source: Amounts shown are from reports of the Appropriations Committees accompanying the
appropriations bills for the following years.
Agency Overview
The Department of Veterans Affairs (VA) administers directly, or in conjunction
with other federal agencies, programs that provide benefits and other services to
veterans and their spouses, dependents and beneficiaries. The VA has three primary
organizations to provide these benefits: the Veterans Benefits Administration
(VBA), the Veterans Health Administration (VHA), and the National Cemetery
Administration (NCA). Benefits available to veterans include service-connected
disability compensation; a pension for low-income veterans who are elderly or have
a nonservice-connected disability; vocational rehabilitation for disabled veterans;
medical care; life insurance; home loan guarantees; burial benefits; and educational
and training benefits to transition active servicemembers to civilian life.
Table 3. Appropriations: Department of Veterans Affairs,
FY2006-FY2008
(budget authority in billions)
FY2006
FY2007
FY2008
House
Program
enacted
enacted
request
Committee
Total $71.458
$79.551
$83.904
$87.697
Mandatory
Compensation, pensions, burial
33.898
38.007
41.236
41.236
Readjustment benefits
3.309
3.262
3.300
3.300
Insurance/indemnities
0.046
0.050
0.041
0.041
Housing programs (net, indefinite)a
-0.047
-0.034
-0.091
-0.091
Subtotal: Mandatory
$37.206
$41.285
$44.487
$44.487
Discretionary
Medical services
21.322
25.518
27.168
28.906
Emergency funding
1.225
—
—
—
Emergency funding (P.L. 109-148)
0.225
—
—
—

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CRS-8
FY2006
FY2007
FY2008
House
Program
enacted
enacted
request
Committee
Emergency funding (P.L. 110-028)
—
0.467
—
—
Medical administration
2.858
3.178
3.442
3.636
Emergency funding (P.L. 110-028)
—
0.250
—
—
Medical facilities
3.298
3.570
3.592
4.100
Emergency funding (P.L. 110-028)
—
0.595
—
—
Medical & prosthetic research
0.412
0.414
0.411
0.480
Emergency funding (P.L. 110-028)
—
0.033
—
—
Medical care collection fundb
(offsetting receipts)
-2.170
-2.329
-2.414
-2.414
(appropriations — indefinite)
2.170
2.329
2.414
-2.414
Subtotal: Medical programs &
administration (appropriations)
29.341
34.024
34.613
37.122
Total available to VHA
31.511
36.353
37.027
39.536
General administration expense
1.411
1.481
1.472
1.599
Emergency funding (P.L. 109-148)
0.025
—
—
—
Emergency funding (P.L. 110-028)
—
0.083
—
—
Information technology
1.214
1.214
1.859
1.859
Emergency funding (P.L. 110-028)
—
0.035
—
—
National Cemetery Administration
0.156
0.161
0.167
0.170
Emergency funding (P.L. 109-148)
c
— —
—
Inspector General
0.070
0.071
0.073
0.077
Construction
0.806
0.598
0.961
2.026
Emergency funding (P.L. 109-148)
0.369
—
—
—
Emergency funding (P.L. 109-234)
0.586
—
—
—
Emergency funding (P.L. 110-028)
—
0.326
—
—
Grants for state extended care facilities
0.085
0.085
0.085
0.165
Grants for state veterans cemeteries
0.032
0.032
0.032
0.037
Housing & other loan administration
0.155
0.155
0.156
0.156
Disaster compensation (P.L. 106-148)
0.003
—
—
—
Subtotal: Other Discretionary
4.912
$4.241
4.804
6.088
Subtotal: Discretionary
$34.252
$38.265
$39.417
43.210
Source: Table prepared by the Congressional Research Service based on reports of the House
Appropriations Committee, various fiscal years.
a. This negative budget authority is the result of combining the loan subsidy payments estimated to
be needed during FY2006 with the offsetting receipts expected to be collected.
b. Medical Care Collections Fund (MCCF) receipts are restored to the VHA as an indefinite budget
authority equal to the revenue collected.
c. $200,000.

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CRS-9
Key Budget Issues
The budget submitted by the Administration in February 2007 calls for funding
VA at a level of $83.9 billion for FY2008 (see Table 4). This would be an increase
of $4.4 billion, or 5.5%, over the FY2007 appropriation (including the supplemental).
One of the key issues for VA non-medical benefits has been the size of the
disability claims workload and the average time (177 days in FY2006)7 to process
claims. The U.S. Troop Readiness, Veterans’ Care, Katrina Recovery, and Iraq
Accountability Appropriations Act, 2007 (P.L. 110-028), provided additional funding
to the VA for resources to address the large number of pending claims and shorten
processing times. P.L. 110-028 provided an additional $60.75 million for hiring and
training of additional claims processing personnel, and $20.0 million for information
technology to support claims processing.
The FY2008 appropriation bill, H.R. 2642, continues to provide additional
funds for claims processing by including full-year funding for the personnel hired
with P.L. 110-028 funding, and providing funding for the additional claims
processing personnel proposed in the FY2008 budget request.
The FY2008 appropriation also includes:
! funds for a cost-of-living adjustment (COLA) for certain VA
benefits including compensation benefits — disability compensation
and dependency and indemnity compensation (the COLA is
estimated at 1.4%, and is the same COLA provided to Social
Security beneficiaries);
! an increase of $1.01 billion above the FY2007 appropriation for new
construction, with no specific projects designated at this time;
! an increase of $416.06 million in minor construction with the
requirement that the VA submit an expenditure plan for the total
funding for minor construction ($615.0 million) within 30 days of
enactment; and
! an increase of $8.0 million in grants for construction of state
extended care facilities.
7 Department of Veterans Affairs, FY2008 Budget Submission, Summary Volume, pg. 1-22.

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CRS-10
Medical Care
The Veterans Health Administration (VHA) is a direct service provider of
primary care, specialized care, and related medical and social support services to
veterans through an integrated health care system. In FY2007, VHA operated 155
medical centers, 135 nursing homes,8 717 ambulatory care and community-based
outpatient clinics (CBOCs),9 and 209 Readjustment Counseling Centers (Vet
Centers).10 VHA also pays for care provided to veterans by independent providers
and practitioners on a fee basis under certain circumstances. Inpatient and outpatient
care is provided in the private sector to eligible dependents of veterans under the
Civilian Health and Medical Program of the Department of Veterans Affairs
(CHAMPVA).11 In addition, VHA provides grants for construction of state-owned
nursing homes and domiciliary facilities, and collaborates with the Department of
Defense (DOD) in sharing health care resources and services.
The total amount requested by the Administration for VHA for FY2008 is $34.6
billion, a 1.7% increase in funding compared to the FY2007 enacted amount. The
total amount of funding that would be available for VHA under the President’s
budget proposal for FY2008, including third-party collections, is approximately
$37.0 billion. For FY2008, the Administration is requesting $27.2 billion for
medical services, a $1.2 billion, or 4.6%, increase in funding over the FY2007
enacted amount. The Administration’s budget proposal is also requesting $3.4
billion for medical administration, $3.6 billion for medical facilities, and $411
million for medical and prosthetic research.
As in FY2003, FY2004, FY2005, FY2006, and FY2007, the Administration
has included several cost sharing proposals. The first proposal is the tiered annual
enrollment fee for all enrolled Priority Group 7 and Priority Group 8 veterans, which
is structured to charge $250 for veterans with family incomes from $50,000 to
8 Data on the number of hospitals and nursing homes includes facilities damaged by
Hurricane Katrina. The data are current as of December 1, 2006.
9 Data on the number of CBOCs differ from source to source. Some count clinics located
at VA hospitals while others count only freestanding CBOCs. The number represented in
this report excludes clinics located in VA hospitals. VA plans to activate 38 new CBOCs
in FY2007 and FY2008.
10 On February 7, 2007, the Department announced that it will be establishing 23 new
centers in communities across the nation during 2007 and 2008. New Vet Centers will be
located in Montgomery, Alabama; Fayetteville, Arkansas; Modesto, California; Grand
Junction, Colorado; Orlando, Fort Myers, and Gainesville, Florida; Macon, Georgia;
Manhattan, Kansas; Baton Rouge, Louisiana; Cape Cod, Massachusetts; Saginaw and Iron
Mountain, Michigan; Berlin, New Hampshire; Las Cruces, New Mexico; Binghamton,
Middletown, Nassau County and Watertown, New York; Toledo, Ohio; Du Bois,
Pennsylvania; Killeen, Texas; and Everett, Washington. During 2007, VA plans to open
facilities in Grand Junction, Orlando, Cape Cod, Iron Mountain, Berlin and Watertown. The
other new Vet Centers are scheduled to open in 2008.
11 For further information on CHAMPVA, see CRS Report RS22483, Health Care for
Dependents and Survivors of Veterans, by Jacqueline Rae Roche and Sidath Viranga
Panangala.

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CRS-11
$74,999; $500 for those with family incomes from $75,000 to $99,999; and $750 for
those with family incomes equal to or greater than $100,000. According to the VA,
this proposal would increase government revenue by $138 million beginning in
FY2009, and by $526 million over five years.
The Administration is proposing to increase the pharmacy copayments from $8
to $15 for all enrolled Priority Group 7 and Priority Group 8 veterans, whenever they
obtain medication from VA on an outpatient basis for the treatment of a nonservice-
connected condition.12 The Administration put forward this proposal in its FY2004,
FY2005, FY2006, and FY2007 budget requests as well, but did not receive any
approval from Congress. At present, veterans in Priority Groups 2-8 pay $8 for a 30-
day supply of medication, including over-the-counter medications. The VA estimates
that this proposal would increase government revenue by $311 million beginning in
FY2008, and by $1.6 billion over five years.
Lastly, the Administration is proposing to bill veterans directly for treatment
associated with nonservice-connected conditions. Presently, VA uses third-party
collections to satisfy veterans’ first-party debt; that is, if VA treats an insured veteran
for a nonservice-connected disability, and the veteran is also determined by VA to
have copayment responsibilities, VA will apply each dollar collected from the
insurer to satisfy the veteran’s copayment debt related to that treatment. The
Administration proposes eliminating this practice. According to the VA, this
proposal would increase government revenue by $44 million beginning in FY2008,
and by $217 million over five years.
It should be noted that compared to previous budget proposals, the FY2008
budget proposals if implemented would deposit all collections in the U.S. Treasury
and not in the Medical Care Collections Fund (MCCF) as is the current practice with
regard to collections.13 The President’s budget request amount for medical services
does not reflect these legislative proposals.
On June 6, 2007, the House Appropriations Committee recommended $37.1
billion for VHA for FY2008 , a 9.1% increase over the FY2007 enacted amount of
$34.0 billion, and 7.3% above the President’s request. This amount includes $28.9
billion for medical services, $1.8 billion (6.4%) above the President’s request and
$2.9 billion (11.2%) over the FY2007 enacted amount of $26.0 billion. Of the
amount recommended for the medical services account, the Committee has included
12 The term “service-connected” means, with respect to disability, that such disability was
incurred or aggravated in the line of duty in the active military, naval, or air service. VA
determines whether veterans have service-connected disabilities, and for those with such
disabilities, assigns ratings from 0 to 100% based on the severity of the disability.
Percentages are assigned in increments of 10%.
13 VA deposits copayments collected from veterans obligated to make such payments for
either medical services or inpatient pharmacy benefits for outpatient medication, and
third-party insurance payments from service-connected veterans for nonservice-connected
conditions into MCCF. These collected funds do not have to be spent in any particular
fiscal year and are available until expended.

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CRS-12
bill language stipulating $2.9 billion for speciality mental health care, $130 million
for the homeless veterans grant and per diem program, $429 million for the substance
abuse program, and $100 million for the blind rehabilitation services.
The Committee recommendation also includes $3.6 billion for medical
administration, $193 million above the Administration’s request of $3.4 billion; $4.1
billion for medical facilities, a 14% increase over the President’s request; and $480
million for medical and prosthetic research, a 17% increase over the President’s
request of $411 million. The Committee did not recommend any fee increases as
requested by the Administration’s budget proposal for VHA for FY2008.
Title III: Related Agencies
American Battle Monuments Commission
The American Battle Monuments Commission (ABMC) is responsible for the
maintenance and construction of U.S. monuments and memorials commemorating
the achievements in battle of U.S. armed forces since the nation’s entry into World
War I; the erection of monuments and markers by U.S. citizens and organizations in
foreign countries; and the design, construction, and maintenance of permanent
cemeteries and memorials in foreign countries. The Commission maintains 24
cemeteries and 25 monuments, memorials, and markers in 15 countries, including
three memorials on U.S. soil.
The ABMC was responsible for the planning and construction of the World War
II Memorial on the Mall in Washington, DC. Though the National Park Service
assumed responsibility for the operation and maintenance of the Memorial at its
dedication, the ABMC retains a fiduciary responsibility for the remaining public
contributions given for its construction. The ABMC has undertaken the construction
of an Interpretive Center at the Normandy American Cemetery, in Normandy, France,
to commemorate the World War II Allied invasion of France on June 6, 1944, and
the subsequent land battles in Europe. The new facility opened on June 6, 2007.
U.S. Court of Appeals for Veterans Claims
The U.S. Court of Appeals for Veterans Claims was established by the
Veterans’ Administration Adjudication Procedure and Judicial Review Act of 1988
(P.L. 100-687). The Court is an independent judicial tribunal with exclusive
jurisdiction to review decisions of the Board of Veterans’ Appeals. It has the
authority to decide all relevant questions of law; interpret constitutional, statutory,
and regulatory provisions; and determine the meaning or applicability of the terms
of an action by the VA. It is authorized to compel action by the VA. It is authorized
to hold unconstitutional or otherwise unlawful and set aside decisions, findings,
conclusions, rules and regulations issued or adopted by the VA or the Board of
Veterans’ Appeals.
The Court currently occupies leased facilities near Judiciary Square in the
District of Columbia and is searching for a permanent location. The Court’s major

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CRS-13
operational initiative is its transition to an electronic case filing system, which is also
funded through this appropriation.
Department of Defense - Civil (Army Cemeterial Expenses)
The Secretary of the Army is responsible for the administration, operation and
maintenance of Arlington National Cemetery and the Soldiers’ and Airmen’s Home
National Cemetery. In addition to its principal function as a national cemetery,
Arlington is the site of approximately 3,100 non-funeral ceremonies each year and
has approximately 4,000,000 visitors annually.
Armed Forces Retirement Home (AFRH)
The Armed Forces Retirement Home Trust Fund provides funds to operate and
maintain the Armed Forces Retirement Home in Washington, DC (also known as the
United States Soldiers’ and Airmen’s Home), and the Armed Forces Retirement
Home in Gulfport, Mississippi (originally located in Philadelphia, PA, and known
as the United States Naval Home). These two facilities provide long-term housing
and medical care for approximately 1,600 needy veterans. The Gulfport campus,
encompassing a 19-story living accommodation and medical facility tower, was
severely damaged by Hurricane Katrina at the end of August, 2005, and is not
currently in use. Residents of the facility were transferred to the Washington, DC,
location immediately after the storm.
The appropriation for the AFRH facilities is from the Armed Forces Retirement
Home Trust Fund. The Trust Fund is maintained through gifts, bequests, and a $0.50
per month assessment on the pay of active duty enlisted military personnel and
warrant officers.
The FY2008 budget request includes a $5.1 million federal fund contribution
to the trust, and $800,000 for a study of the long-term viability of the Trust. The
FY2008 appropriation bill, H.R. 2642, does not include the federal contribution, but
does include $800,000 for the study.
Table 4. Appropriations: Related Agencies, FY2006-FY2008
(budget authority in thousands)
FY2006
FY2007
FY2008
House
Account
enacted
enacted
request
Committee
American Battle Monuments Commission
Salaries and expenses
$35,888
$37,000
$42,100
$43,470
Foreign currency fluctuations
15,098
5,000
11,000
11,000
Total
50,986
42,000
53,100
54,470
U.S. Court of Appeals for Veterans Claims
Salaries and expenses
18,607
20,189
21,217
21,397
Department of Defense-Civil
Army cemeterial expenses
28,760
30,000
26,892
30,592
Armed Forces Retirement Home

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CRS-14
FY2006
FY2007
FY2008
House
Account
enacted
enacted
request
Committee
Operations and maintenance
56,463
55,991
55,724
55,724
Capital program
1,236
1,236
—
—
General fund appropriation
—
—
5,900
800
Emergency funding (P.L. 109-148)
65,800
—
—
—
Total
299,499
57,227
61,624
56,524
Total, related agencies
$397,852
$149,146
$162,833
$162,983
Source: Table prepared by the Congressional Research Service based on reports of the House Appropriations
Committee, various fiscal years.

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CRS-15
Appendix A. Consolidated Non-VA Funding Tables
Table 5. DOD Military Construction
(budget authority in $000)
FY2007
FY2008
House
Account
Senate
Conference
Enacted
Request
Committee
Military Construction, Army
2,017,321
4,039,197
4,070,959
—
—
Rescissions
(43,348)
—
—
—
—
Emergency Appropriations
1,255,890
—
—
—
—
(P.L. 110-28)
Emergency Appropriations
(P.L. 110-28, By transfer,
(6,250)
—
—
—
—
Army Sec. 3309)
Total
3,229,863
4,039,197
4,070,959
—
—
Military Construction,
1,130,821
2,104,276
2,125,138
—
—
Navy and Marine Corps
Rescissions
(27,500)
—
(5,862)
—
—
Emergency Appropriations
370,990
—
—
—
—
(P.L. 110-28)
Total
1,474,311
2,104,276
2,119,276
—
—
Military Construction,
1,083,000
912,109
927,428
—
—
Air Force
Rescissions
(2,694)
—
(5,319)
—
—
Emergency Appropriations
43,300
—
—
—
—
(P.L. 110-28)
Total
1,123,606
912,109
922,109
—
—
Military Construction,
1,127,000
1,799,336
1,806,928
—
—
Defense-wide
Rescissions
(110,229)
—
(7,592)
—
—
Total
1,016,771
1,799,336
1,799,336
—
—
Total, Active components
6,844,551
8,854,918
8,911,680
—
—
Military Construction,
473,000
404,291
439,291
—
—
Army National Guard
Rescissions
(2,129)
—
—
—
—
Total
470,871
404,291
439,291
—
—
Military Construction,
128,000
85,517
95,570
—
—
Air National Guard
Military Construction,
166,000
119,684
154,684
—
—
Army Reserve
Military Construction,
43,000
59,150
69,150
—
—
Naval Reserve
Military Construction,
45,000
26,559
39,628
—
—

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CRS-16
FY2007
FY2008
House
Account
Senate
Conference
Enacted
Request
Committee
Air Force Reserve
Rescissions
—
—
(3,069)
—
—
Total
45,000
26,559
36,559
—
—
Total, Reserve components
850,871
695,201
795,201
—
—
Total, Military Construction
7,695,422
9,550,119
9,706,881
—
—
NATO Security Investment
204,789
201,400
201,400
—
—
Program
Family Housing Construction,
579,000
419,400
419,400
—
—
Army
Family Housing Ops and Debt,
671,311
742,920
742,920
—
—
Army
Family Housing Construction,
305,000
298,329
298,329
—
—
Navy and Marine Corps
Family Housing Ops and Debt,
505,472
371,404
371,404
—
—
Navy and Marine Corps
Family Housing Construction,
1,168,000
362,747
362,747
—
—
Air Force
Rescissions
(18,000)
—
—
—
—
Total
1,150,000
362,747
362,747
—
—
Family Housing Ops and Debt,
750,000
688,335
688,335
—
—
Air Force
Family Housing Construction,
9,000
—
—
—
—
Defense-wide
Family Housing Ops and Debt,
49,000
48,848
48,848
—
—
Defense-wide
DOD Family Housing
2,475
500
500
—
—
Improvement Fund
Total, Family Housing
4,021,258
2,932,483
2,932,483
—
—
Chemical Demilitarization
131,000
86,176
86,176
—
—
Construction, Defense-wide
Base Realignment and Closure
BRAC, 1990
252,279
220,689
270,689
—
—
BRAC, 2005
2,489,421
8,174,315
8,174,350
—
—
Emergency Appropriations
3,136,802
—
—
(P.L. 110-28)
Total
5,878,502
8,395,004
8,445,004
—
—
Grand Total, MilCon & FH
17,930,971
21,165,182
21,371,944
—
—

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CRS-17
Appendix B. Additional Resources
Budget
CRS Report RL30002, A Defense Budget Primer, by Mary T. Tyszkiewicz and
Stephen Daggett.
CRS Report 98-720, Manual on the Federal Budget Process, by Robert Keith and
Allen Schick.
Selected Websites
House Committee on Appropriations
[http://appropriations.house.gov/]
Senate Committee on Appropriations
[http://appropriations.senate.gov/]
House Committee on Armed Services
[http://www.house.gov/hasc/]
Senate Committee on Armed Services
[http://armed-services.senate.gov/]
House Committee on Veterans Affairs
[http://veterans.house.gov/]
Senate Committee on Veterans Affairs
[http://veterans.senate.gov/]
Commission on Review of Overseas Military Facility Structure of the United States
(Overseas Basing Commission)
[http://www.obc.gov/]
CRS Appropriations Products Guide
[http://www.crs.gov/products/appropriations/apppage.shtml]
CRS Multimedia Library
[http://www.crs.gov/products/multimedia/multimedialibrary.shtml]
Congressional Budget Office
[http://www.cbo.gov/]
Defense Base Closure and Realignment Commission (BRAC Commission)
[http://www.brac.gov]
Government Accountability Office
[http://www.gao.gov/]

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