BILL ANALYSIS                                                                                                                                                                                                    

                                                                     AB 255

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          Date of Hearing:   


                                 Jacqui Irwin, Chair

          AB 255  
          (Irwin) - As Introduced February 9, 2015

          SUBJECT:  Veterans:  Inspector General for Veterans Affairs

          SUMMARY:  Recreates the office of Inspector General in the  
          California Department of Veterans Affairs (department).   
          Specifically, this bill:  

          1)Creates the office of Inspector General (IG) for Veterans  
            Affairs, who would be subject to the direction of the  
            Governor, within the department. 

          2)Requires the IG to be appointed by the Governor, subject to  
            Senate confirmation.

          3)Assigns responsibility to the IG for reviewing the operations  
            and financial condition of each California veterans home, the  
            veterans farm and home purchase program, and all other  
            veterans programs supported by the state. 


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          4)Directs that beginning January 1, 2017, and each year after,  
            the Inspector General shall submit a report to the board and  
            the Legislature and make any recommendations he or she deems  
            necessary for improving the operations of the veterans  

          5)Authorizes the Inspector General to receive communications  
            from any individual who believes he or she may have  
            information that warrants a review or investigation of a  
            veterans program. 

          6)Authorizes, and in some instances requires, the IG to conduct  
            a review or investigation. 

          7)Mandates the establishment of a toll-free telephone number to  
            report alleged wrongdoing regarding veterans programs.

          8)Repeals the provisions described above on January 1, 2020.

          EXISTING LAW:  

          Military and Veterans code section 78.5 refers to the IG, "The  
          secretary shall conduct audits as required by Section 13402 of  


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          the Government Code, on internal controls of the department,  
          that shall be provided to the inspector general." The department  
          had an IG but the position, which was created in 1999, was  
          eliminated by budget action in 2004.

          Creates the California Veterans Board (Board). Members of the  
          Board are appointed by the Governor.  The Board advises the  
          department and secretary on policies for operations of the  
          department. The Board has access to all documents and employees  
          of the department.  

          Creates the California State Auditor's office with broad  
          authority. The State Auditor promotes the efficient and  
          effective management of public funds and programs by providing  
          to citizens and the State independent, objective, accurate, and  
          timely evaluations of state and local governments' activities. 

          FISCAL EFFECT:  Unknown at this time.

          COMMENTS:  There is not an Inspector General within the  
          department.  State correctional agencies have an Inspector  
          General.  Most federal agencies have an Inspector  

          General.  The Military Department has an Inspector General.

          Previous to the passage of AB 92, the department had an internal  
          auditor position. The Inspector General position was created by  
          AB 92 (Floyd) then eliminated in 2004 by SB 1111, a budget bill.  

          This bill is largely modeled on AB 92.  The Senate Committee on  
          Veterans Affairs analysis of AB 92 from June of 1999 contains  


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            The author states that a lack of oversight over the California  
            Department of Veterans Affairs has resulted in major problems  
            in the administration of the Cal-Vet farm and home loan  
            program and the operation of the two state veterans homes.

          Unfortunately, though the focus has shifted away from the Farm  
          and Home Loan Program, the rationale, that there is a lack of  
          internal oversight at CalVet which has resulted in  
          inefficiencies, cost overruns, and mis-management concerns, is  
          still valid.  

          Moreover, since 1999, the world has changed tremendously and, in  
          particular, for most of the first decade of the 2000's the  
          United States has been in protracted armed conflict in Iraq and  
          Afghanistan as well as in shorter conflicts throughout the  
          world.  These conflicts have and continue to produce many  
          veterans who reside in California, currently approximately 1.8  

          Keeping pace so that it might continue to serve California  
          veterans well, the department has also grown.  In particular,  
          the then two state veterans homes have grown to a system of  
          eight, The Veterans Homes range in size from 60 residents on 20  
          acre campuses to over 1,000 residents on a 500 acre campus. Each  


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          Home is distinctive within its region and offers its own unique  
          environment, levels of care combinations.  Furthermore, there  
          are now two state veterans cemeteries operated by CalVet and a  
          third site is being evaluated. 

          There are far too many activities the department performs to  
          list them all.  However, some of the larger roles are: Approving  
          schools' eligibility for GI Bill funds, the CalVet Homeless  
          Veteran Outreach Support Program, the California Veterans  
          Registry, the DVBE Advisory Council, programs for incarcerated  
          veterans. a Veterans Services division which performs many  
          functions including administering funding for the County Veteran  
          Service Officers, programs to reach women, Lesbian, Gay,  
          Bi-Sexual, and Transgender (LGBT) Veterans, and Minority  
          Veterans.  In summary, the department is extremely active and  
          supporting veterans in a host of ways.

          Unfortunately the department has been scrutinized for issues  
          including administration of Morale Welfare, and Recreation  
          funds, cost overruns on the Enterprise Wide Veteran Healthcare  
          Information System, questions concerning Veterans Homes' not  
          being at full capacity, the lack of the requisite kitchen at the  
          West Los Angeles Home (including a series of several pieces in  
          the Los Angeles Times), the overall cost of the Homes, a dearth  
          of implementing regulations, and other matters.

          There have been multiple recent changes in executive level  
          leadership at the department including the departure of the  
          previous Secretary and Undersecretary.  Most recently a new  
          Acting Secretary was appointed.  The Acting Secretary has  
          publicly shared that her mission is one of organizational change  
          and her goals include improving the administration and improving  
          efficiencies at the department.  


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          The IG concept is to have an internal person authorized to  
          investigate most or all matters, but having that person be able  
          or required to report outside the chain of command as necessary.  
           This allows the IG to both internally assist, in this case the  
          Secretary within the organization, and to report externally,  
          directly to the Governor or Legislature, when necessary.  Given  
          the growth in the department's role and number of the programs  
          it supports, the rapid growth of the Homes System, and the  
          questions on various issues outlined above, the IG seems  
          warranted here.  This bill contains a sunset provision so that  
          the utility of the IG will be reevaluated by the Legislature.  

          There is recent precedent in the California Military Department.  
           In response to a series of negative incidents, in 2012 SB 921  
          (Lieu) the California Military Whistleblower Protection Act,  
          signed by the Governor September 28, 2012, created an inspector  
          general in the California Military Department at a time when a  
          new Adjutant General was being appointed with the mission of  
          organizational change.





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          None on File. 


          None on File. 

          Analysis Prepared by:John Spangler / V.A. / (916) 319-3550