Members of the House Committee on Veterans’ Affairs focused on a $20 billion item in the Department of Veterans Affairs’ (VA) $325.1 billion 2024 budget request during a March 23 hearing to assess the Biden administration’s fiscal 2024 funding proposal for the department—and advance appropriations request for 2025.
Panel members questioned VA Secretary Denis McDonough over plans to pull the $20 billion from the fund created as part of the landmark PACT Act enacted in August 2022, which expands health care and benefits to veterans who were exposed to toxins while serving.
A central component of the PACT Act, into which Congress rolled the Cost of War Toxic Exposures Fund (TEF), is $300 billion in financial benefits.
Members of the panel explained that they thought that the VA, as reflected in its budget proposal, looked at the TEF fund as a new and massive resource from which money could be allocated to pay for broad VA medical and health care spending, rather than only for the specific purpose and group for which it’s intended—veterans harmed by exposure to toxic chemicals and their survivors.
“I have some concerns about how this budget request is structured,” Committee Chairman Mike Bost (R-Ill.), a Marine Corps veteran, said in his opening statement.
“It has far too many gimmicks. And today’s gimmicks are tomorrow’s headaches,” he added.
“There has been a process for a long time, called the Second Bite, where VA revises its medical care request during the year. It exists for a reason, and it works. Why should we get rid of it?
“I don’t believe anyone intended the Toxic Exposure Fund to replace it. The more complex a budget is, the harder it is to manage and have transparency. And these complexities make VA less accountable to the veterans they serve.”
In his opening remarks, Mark Takano (D-Calif.), the ranking Democrat on the committee, also dug into the issue of the VA budget and the use of TEF money.
“For fiscal year ’24, I want to highlight a concern of mine regarding VA not requesting a second bite,” Takano said.
“It has been the custom in previous budgets that we have a second bite. VA health care is funded through an advance appropriations process—and the so-called second bite allows VA to adjust its previous ask to Congress to address unexpected changes to health care costs, such as new prescription drugs coming to market or increased costs for labor and materials.
“Instead, this year’s budget relies on a request of over $21 billion to the Toxic Exposure Fund, which was only appropriated $5 billion for fiscal year ’23. That is a significant difference. Relying on the Toxic Exposure Fund as a means to address increasing demands is a risky proposition.”
Bost kept after McDonough and the TEF and PACT segment of the VA’s budget request, although the figure he referenced for the VA’s TEF budget item was $1 billion less than the number cited by Takano.
“Mr. Secretary, you’re asking for $20 billion for Toxic Exposure funds for next year,” the Illinois Republican said. “But you aren’t even planning on spending at least $3 billion of that. Why are you requesting money that you can’t or won’t spend?”
McDonough emphasized the frequent reporting and accounting of the VA to the Committee on Veterans’ Affairs and that he has recently corresponded with the department’s inspector general and asked him to apply particular scrutiny to the VA’s use of TEF.
“But the PACT Act is a new way of doing business,” he said. “And, importantly, you gave us authority in there that said any dollars for toxic exposure-related care and benefits above the F21 baseline can be moved into the TEF.
“We’ve done exactly that and no more in this budget.”
