Interim Joint Committee on Seniors, Veterans, Military Affairs, and Public Protection


Minutes of the<MeetNo1> 1st Meeting

of the 2003 Interim


<MeetMDY1> June 5, 2003


The<MeetNo2> 1st meeting of the Interim Joint Committee on Seniors, Veterans, Military Affairs, and Public Protection was held on<Day> Thursday,<MeetMDY2> June 5, 2003, at<MeetTime> 1:00 PM, in<Room> Room 131 of the Capitol Annex. Senator Dan Seum, Co-Chair, called the meeting to order, and the secretary called the roll.


Present were:


Members:<Members> Senator Dan Seum, Co-Chair; Representative Mike Weaver, Co-Chair; Senators Walter Blevins, Tom Buford, Paul Herron Jr., Joey Pendleton, Albert Robinson, Richard Roeding, and Jack Westwood; Representatives Sheldon Baugh, Carolyn Belcher, Bill Farmer, Danny Ford, Mary Harper, Jodie Haydon, Fred Nesler, Tanya Pullin, Steve Riggs, Tom Riner, Dottie Sims, and Jim Thompson.


Guests:  BG (Ret.) Jim Shane, Kentucky Commission on Military Affairs; Larry Cox, Office of Sen. Mitch McConnell; BG (Ret.) Les Beavers, Kentucky Department of Veterans Affairs (KDVA); Howard Howells, Joint Executive Council of Veterans Organizations (JECVO).


LRC Staff:  Scott Varland, Clint Newman, Mike Bennett, Todd Stephens, and Wanda Gay.


A quorum being present, Co-Chair Seum began the meeting by mentioning the death of Congressman Ron Lewis’ mother.  The death of Senator Katie Stine’s mother-in-law was announced.  Also, Senator Seum commented that Senator Elizabeth Tori’s husband was ill and not doing well.  The members of the Committee were asked to keep each of these families in their thoughts.


The first item on the agenda was a discussion of the current federal military Base Realignment and Closure procedure that will conclude in 2005 (BRAC 2005).  Co-Chair Seum introduced BG (Ret.) Jim Shane and Mr. Larry Cox.  Senator Seum noted the importance of Fort Knox, Fort Campbell, and the Bluegrass Army Depot to Kentucky and asked General Shane to begin his presentation.  An outline of the information discussed by General Shane is contained in a PowerPoint presentation included as a part of the meeting materials archived in the LRC library.


BG (Ret.) Jim Shane, Executive Director, Kentucky Commission on Military Affairs noted the assistance of Ms. Stacey Games, his principal assistant.  He also thanked Mr. Larry Cox, State Director, Office of Sen. Mitch McConnell and mentioned the past efforts of Kentucky’s Congressional delegation in supporting Kentucky’s military installations. 


Following his opening remarks, General Shane acknowledged a twofold purpose for his presentation: (1) to provide an overview of base closure and its importance to the Commonwealth, and (2) to ask for legislative assistance and support, as the state moves forward over the next two years, in helping to protect the state’s military assets. 


General Shane gave an overview of the authorization and mission of the Kentucky Commission on Military Affairs.  The seven major military installations in the Commonwealth are: Fort Campbell, Fort Knox, Bluegrass Army Depot, 100th Div. (IT), Corp of Engineers, Ford Regional Training Center and the Kentucky National Guard.  The military is a four billion dollar Kentucky industry.  Thirteen other states have created military commissions similar to Kentucky’s and all are concentrating on developing strategies and initiatives for BRAC 2005.  General Shane noted that military leadership, headed by Secretary Rumsfeld, is facing a tremendous challenge on what to do with excess capacity that exists within the United States defense structure. 


General Shane highlighted the importance of homeland security in consideration for this round of base closures.  Also, the preservation of training areas will no longer focus primarily on the Army, but instead, will focus on combining efforts between the military branches to foster a joint training posture that will enhance readiness and evaluate the cost efficiencies of day-to-day operations. 


General Shane stated the BRAC 2005 timeline.  The first year, 2003, is considered the planning year.  2004 is the assessment year, primarily performed by the Department of Defense.  2005 is the decision year, and he indicated that if Kentucky were in a bad position in this phase of the process the state would have a difficult time preserving or protecting any installations included on a recommended list.  One area of involvement that state leadership may have during this process, is to take advantage of opportunities to assist with key milestone goals.


Senator Roeding asked how the nine member BRAC Commission was selected and what were the member qualifications.  General Shane answered that the selections were done by various individuals including the President of the United States, the majority party of the United States Senate (two members), the minority party of the United States Senate (one member), the majority party of the United States House of Representatives (two members), and the minority party of the United States House of Representatives (one member).  He emphasized that the makeup of the commission has the potential to play a critical role in representing interests.


Representative Baugh inquired as to whether the Department of the Army makes the list of recommended base closures or if it would be the responsibility of the BRAC Commission to do so.  According to General Shane, the Army will use a rigorous and extensive process to evaluate which installations are to be included on a recommended list which will then be provided to the Commission.  The process begins by the Army making recommendations to an executive group which performs the initial evaluation and then forwards their findings back to the Department of the Army.  The findings are then presented to the Secretary of Defense for approval.  Finally, the Secretary of Defense forwards the recommending list to the BRAC Commission. 


Representative Baugh stated that he hoped the Department of the Army would support the continued operation of the bases in Kentucky, but asked if the work of Kentucky’s Commission would be too late should a Kentucky installation be included on the Army’s recommended list of closures.  General Shane affirmed the comment and suggested that one of the main reasons for his presentation was to demonstrate that Kentucky needs to take a very proactive approach to preclude any Kentucky installation from being included on a recommended closure list.  He further mentioned that in light of the fact that 30% of the nation’s bases will close, Kentucky has an opportunity to prosper by being ready to accept new missions as a result of the closure and realignment of installations in other states. 


To support his ideas on how Kentucky should move forward in the BRAC process, General Shane mentioned his background in dealing with this issue.  In 1995, he headed the Army BRAC Task Force comprised of 25 individuals.  During BRAC 1995, he worked very closely with the Army auditing team, the General Accounting Office (GAO), the BRAC Commission, and the Kentucky Congressional delegation.  His responsibilities included evaluating all 95 installations being considered for closure or realignment and making recommendations to Army leadership.


There are four significant changes to this BRAC process that are substantially different from previous efforts.  In this round, there will be a more centralized decision making process.  In addition, recommendations will be made by Joint Cross Servicing Groups (JCSG) independent of branch recommendations.  The transformation of the United States Army over the next 20 years will be a key consideration in BRAC criteria.  Also, the availability and use of technology will be considered for the offset of force needs.


General Shane said that Kentucky’s military industry has the fifth largest payroll among Kentucky industries.  The military is the largest employer in the Commonwealth which could relocate outside the state.  Since 1988, the military has lost over 13,000 personnel in Kentucky at a payroll cost of over $235 million.  He also presented figures for the amount of change in state tax receipts from the gain or loss of 1,000 soldiers at Fort Knox ($895,000), Bluegrass Army Depot ($933,000), and Fort Campbell ($96,000).  General Shane noted that Fort Campbell’s number was much lower due to the fact that 80% of the base is located within Tennessee.  The tax receipt numbers were also supplied for the gain or loss of 1,000 civilians in various regions of the state including Lexington/ Eastern Kentucky ($1.6 million), Louisville/ Southern Indiana ($1.7 million), and Paducah ($2 million).  General Shane’s conclusion from these numbers was that BRAC 2005 may have a significant economic impact on the state. 


The next part of General Shane’s presentation highlighted the selection criteria that will be used by the Department of Defense in selecting installations for closure or realignment.  Key components will include military value, return on investment, and community impacts of military installations.  The value of installations to the transformation strategy currently being developed to cover the next 20 years will be the priority component in the selection process.  In addition, consideration of the role of military installations in homeland security will be important.


The next part of the presentation pertained to what Kentucky’s plan should be for working through BRAC 2005.  General Shane provided tasks that Kentucky should complete in each year of the BRAC 2005 process.  Two of the priorities for 2003 should be to monitor legislative policy guidance from the Departments of Defense and the Army and to consider requests for state funding for community assistance.  According to the presentation, several states have already provided assistance to support the efforts of communities around military installations, including South Carolina ($200,000), Texas ($1.2 million), and Florida ($5 million).  Georgia and California have also provided community assistance.  An additional priority for 2003 should be the development of the state’s marketing campaign including the hiring of a Washington based consulting firm to support Kentucky’s efforts.  For 2004 a request for state funding will be submitted.  Also, the Commonwealth’s Congressional delegation will be engaged in the process of determining what steps Kentucky needs to consider.  For 2005, the selection of BRAC Commission membership is key.  The development of favorable scenarios that support Kentucky’s installations will also be important.  Ultimately, General Shane believes that BRAC success depends on seven criteria: (1) selecting the right Kentucky BRAC team; (2) in-depth knowledge of the BRAC process; (3) combination of “What you know” – “Who you know”; (4) submission of data by installations; (5) linking transformation requests to installation capability; (6) obtaining information “early” in the BRAC process; and (7) timely intervention by Congressional leaders. 


Finally, General Shane discussed what he considered to be the bottom line for Kentucky during this round of BRAC.  He commented that the economic impact to the Commonwealth is too great to ignore.  He estimates that Kentucky needs $250,000 to hire a BRAC consultant, which he considers a modest investment given the issue.  That amount of funding has been provided before, and for the past year the General has been working with a Washington consulting firm on BRAC issues.  However, on 30 June the contract with the law firm expires.  He believes that Kentucky needs to hire a new consultant to help with Kentucky’s BRAC efforts.  In addition, competition between the states will be keen.  Resources and political effort expended will be the key to success.  General Shane concluded his briefing.


Co-Chair Seum thanked General Shane and asked Mr. Cox to begin his presentation.


Larry Cox, State Director, Office of Senator Mitch McConnell thanked Senator Seum and stated that his presence was related to a meeting with a group of individuals concerned about Fort Knox who requested that he speak to Senator Seum about their issues.  Mr. Cox read a brief statement that began by noting that Senator McConnell was grateful for the opportunity to make a statement before the Interim Joint Committee regarding the future of Fort Knox as a viable military installation and a key economic asset for the Commonwealth.  While noting the competence of the General Assembly in managing the legislative affairs of the Commonwealth, BRAC 2005 provides a clear conjunction of interests between the Commonwealth and Kentucky’s Congressional delegation.  Military installations under the Training and Doctrine Command (TRADOC), such as Fort Knox, might be more vulnerable during this round of BRAC than those installations under Force Command.  Because many of the decisions relating to BRAC will be determined during the initial assessment phase of BRAC 2005, those in charge of Kentucky’s BRAC efforts need good representation in the Pentagon and need to gather important intelligence from the Pentagon.  Therefore, Kentucky should have a skilled and well-connected BRAC lobbyist.  To further protect Kentucky’s position, two items are necessary: (1) identifying a qualified Washington representative with a background in base closure issues; and (2) continuing on-going efforts to improve Kentucky’s military posts. The Interim Joint Committee should consider devising a means of securing the services of an outstanding Washington based representative who can look after the interests of the Commonwealth.  Furthermore, this representative should be hired as quickly as possible since the first round of the BRAC process is already underway.  Mr. Cox concluded by thanking the members for the opportunity to appear before the Committee.


Senator Buford asked if it would be reasonable to use any of the federal funding that Kentucky is receiving for homeland security to hire a consultant to help with BRAC.  General Shane answered that it would probably not be looked upon favorably for Kentucky to spend federal funds to lobby the federal government.  He also added that most states are looking at BRAC as a state funded initiative.


Senator Herron asked if the Committee might investigate how the money could be acquired to protect Kentucky.  Senator Seum mentioned that some comments had been made as to whether there might be some local efforts to help.


Co-Chair Weaver asked General Shane to describe for the Committee the number of his current staff, and how much time he spends in Washington.  General Shane said that his office staff consisted of one principal assistant and one secretary.  He further commented that the amount of time spent in Washington varies but that recently he had been spending about 40% of his time there.  He also noted that as BRAC efforts continue the value of a full-time consultant in Washington is to have someone on the ground at all times who can assist in handling issues as they arise.  Co-Chair Weaver mentioned that his point for the question was to let the Committee know how little staff the General has available to him.  He also pointed out that he had sent a letter to Representative Royce Adams on February 20, 2002 requesting $250,000 to hire a Washington lobbyist.  In a letter of response from Governor Patton, it was acknowledged that the law firm of Barbour, Griffith, and Rogers had been retained to work closely with the Governor’s Washington office and with General Shane throughout the BRAC process.  Co-Chair Weaver stressed that this firm has little expertise in BRAC issues.


Co-Chair Weaver continued by highlighting that Mr. Cox had mentioned in his presentation that Fort Knox, as a TRADOC command, was vulnerable.  For example, since 1988 Fort Knox has lost over 8,000 personnel, including all of the base’s FORSCOM units, leaving only TRADOC missions at the facility, thus heightening its vulnerability for BRAC actions.  Mr. Cox agreed with Co-Chair Weaver’s analysis and added that TRADOC facilities were often viewed as second priority in many areas.


Referring to General Shane’s discussion of military value, Co-Chair Weaver gave his opinion that a large part of military value was the community relationship with the installation. He discussed how if a community complains about various activities relating to military maneuvers (such as noise from guns or equipment) the community complaints will be considered as part of military value, and should those complaints become public and be included in data calls, it would be detrimental to a state’s efforts to protect its military assets. General Shane said that if Fort Knox were considered for a review, a town hall type meeting would take place with reviewers hearing all the comments from the community.  Co-Chair Weaver mentioned that Fort Knox has in fact had complaints.  He recommended to Committee members that if they have groups complaining that they make those groups aware of what is at stake if they continue their actions. 


Senator Pendleton discussed the economic value of having a military installation located in a community, and the devastation that can occur when an installation is either temporarily deployed or permanently moved.  He also mentioned that his community is supportive of Fort Campbell, and that Kentucky needs to increase its efforts to protect those installations already located here, and to bring in additional military resources.  One way to show support is for the Committee to find the money to hire the necessary consulting firm to protect the state’s military installations.


Representative Baugh asked General Shane whether states might find ways to join together to try and save bases that could serve regional needs related to homeland security.  General Shane said that during the BRAC process competition among states is very keen and each state generally chooses to serve its own interests making it very difficult to get state leadership to join efforts to protect an outside installation.  Mr. Cox also commented that he felt that those coalitions would be very difficult to form. 


Representative Ford asked General Shane whether the Washington firm being considered to assist in BRAC efforts had committed to representing only Kentucky during the BRAC process.  General Shane responded by stating that he has not decided on any particular firm, but that he was aware of several that could serve the purpose.  He noted that given his previous experience in the process, he knew that $250,000 would be sufficient to hire such a firm.  However, he would have to evaluate how he could best use the firm to determine which consultants could best assist him.


Senator Westwood, reviewing the letter dated March 22 from Governor Patton to Representative Weaver, mentioned that the Governor has already picked the law firm of Barbour, Griffith, and Rogers.  General Shane affirmed the comment but explained that this firm is the one currently contracted with the state.  However, the contract expires at the end of June.  Senator Westwood also asked if this firm is working with any additional states in BRAC efforts.  General Shane answered that the law firm is not, but mostly because the firm has very little BRAC expertise.  He added that there are other firms that have much more expertise.


Representative Pullin spoke as a member who does not have a nearby military installation but who would be very supportive of keeping and growing the bases because it is good for her constituents.  As an example, during the recent call up of troops, many of her constituents who serve in the military where able to be located at a Kentucky installation before being deployed overseas.


Senator Robinson thanked General Shane and Mr. Cox for their comments and agreed with their assessment that Kentucky needs to hire a Washington consulting firm.


Senator Robinson moved that the Committee endorse the hiring of a Washington based consultant and ask the LRC to investigate how to fund the contract.  Senator Roeding seconded the motion.  Senator Seum recommended that the Committee Co-Chairs formulate a letter pursuing the funding and called for a vote.  The Committee unanimously supported the motion.


Representative Riggs said that he was glad that the motion had been made and pointed out that $250,000 was inconsequential considering that the military is an industry with $1.3 billion in payroll.  Also, it would be critical to hire a firm that has the necessary expertise in BRAC issues.


Representative Haydon commented that he appreciated both General Shane and Mr. Cox’s leadership on such an important economic issue.  In his experience as a legislator, the General Assembly has done very little for current industries in Kentucky, and he asked that the legislature might look at helping current employers within the state.


Senator Seum concluded the questions by thanking General Shane and Mr. Cox for their work and mentioning that he and Co-Chair Weaver would be working very diligently to formulate the letter requesting the necessary funding to hire a Washington consultant. 


BG (Ret.) Les Beavers, Commissioner, Kentucky Department of Veterans’ Affairs (KDVA) began his presentation by highlighting the pension dollars that were being brought into legislative districts in the form of checks to veterans.  He also mentioned that the federal Department of Veterans’ Affairs will be going through a realignment called Capital Assets Realignment for Enhanced Services (CARES) which puts the state medical centers at jeopardy for downsizing.  An outline of General Beaver’s presentation is included as part of the meeting materials archived in the LRC library.


With House Bill 269, the General Assembly preserved the KDVA’s commitment to fully staff veterans’ nursing homes within the required 18 month timeframe. 


Senator Seum commended General Beavers for his extreme diligence during the last legislative session in working to support the mission of the KDVA.


General Beavers spent a brief time outlining KDVA’s mission and commitment to future efforts on behalf of veterans throughout the Commonwealth.  He also mentioned his desire to independently fund KDVA free of the state’s General Fund budget.  The state serves over 367,000 veterans, with 38% over the age of 65.


He presented updated projections for the KDVA FY 2004 budget.  According to estimates based on new staffing and receipts, the agency will have approximately $1.6 million in agency funds that the General Assembly will need to authorize for expenditure.  General Beavers commented that during the upcoming budget cycle he would not request an increase in General Fund appropriations, but instead, would be asking only to increase his authorized expenditure levels for restricted agency funds.  He believes this authorization is critical to KDVA operations in the next fiscal year.


He outlined the capital projects currently underway for the KDVA, including the completion of three veterans’ cemeteries.  Two additional cemeteries, to be located in Eastern Kentucky, have received pre-approval for federal grant moneys but need to have operating appropriations included in the next budget to secure the funding.


In Thomson Hood Veterans Center, there are 249 residents.  Thus far in 2003, the nursing center has had 34 deaths and seven discharges.  According to General Beavers, these figures indicate that the residents being served with nursing care are much sicker than the residents received in the past signaling the essential need for skilled nursing care.  He presented employee and patient targets for the end of the current fiscal year and noted that he expects to reach them.


The Western Kentucky Veterans Center currently has 108 residents with three additional patients on the way.  General Beavers noted that Western Kentucky has a shortage of beds for specialty care such as Alzheimer patients.  The facility serves 30 patients in its specialty care wing and has a waiting list of 13.


There are 92 residents in the Eastern Kentucky Veterans Center, but there will be 100 by the end of June.  This center has eight openings in the specialty care unit.  General Beavers mentioned that the difference in the number of requests by region for specialty care has been quite surprising.  Also, there has been a noted difference in the patient pay rates and cost of care between facilities between the eastern and western regions.


In concluding his remarks on the health mission of the KDVA, General Beavers highlighted the service penetration rates for Kentucky.  He noted that the number of veterans using federally provided veterans medical services has risen from 14% to 20%.  He reiterated that these types of increases are good for protecting Kentucky’s medical centers from downsizing.


The next section of the presentation related to the Benefits Branch of the KDVA.  General Beavers stressed that each of the 19 benefits branch employees brings in approximately $2.2 million in return on investment for the state.  During FY 2002, the branch generated nearly $500 million in compensation and pension benefits and received nearly $800 million in total benefits for Kentucky’s veterans.


General Beavers next discussed veterans’ cemeteries.  The 73 acre Hopkinsville cemetery is near completion (scheduled for December) with the cost covered by a $5.8 million federal grant.  Both Fort Knox and Williamstown are in the land acquisition stage with the necessary environmental evaluations being performed.  There will be a funding request during the next legislative session for the operating expenses for both of the cemeteries in order to secure the federal grants to complete the construction of those two locations.  The estimated cost of operation for each cemetery is between $250,000 and $300,000.  Sites have not been found for the two eastern Kentucky cemeteries yet to be initiated.


General Beavers concluded his presentation by focusing on other accomplishments of the agency.  The department was able to acquire a van for the Homeless Veterans Program through the sales of the veterans’ license plate as authorized by the General Assembly.  The department has also received a renovation grant to open a 40 bed transition unit in cooperation with Volunteers of America.  General Beavers indicated that he would need funding of an additional $190,000 to operate the shelter upon its opening.  The project must be completed within five years, one of which has expired.  The KDVA is also still participating in the Korean War MIA Project. The Korean War 50th Anniversary commemoration will end in June with the awarding of the Republic of Korea Korean War Service Medal to those eligible. 


Howard Howells, legislative director for the Joint Executive Council of Veterans Organizations (JECVO) made a presentation on JECVO’s proposed legislative program for the 2004 session.  The focus of this program would be initiatives that would free the KDVA from requiring General Fund moneys to continue its programs.  According to Mr. Howells, there were several pieces of legislation to address KDVA funding that failed to pass during the 2003 session including: Veterans’ Service Organizations charitable gaming, lottery scratch off, tuition waivers for veterans, and a veterans personal loan program.  In testimony, he indicated that amending charitable gaming statutes would bring an additional $95,000 for the veterans’ trust fund.  He noted that a lottery scratch off program raised $1.5 million for West Virginia veterans last year. A similar program could yield nearly $2.5 million in Kentucky.  Mr. Howells also indicated JECVO’s support for a veterans’ personal loan program similar to the one in Wisconsin which has allowed the veterans’ administration to operate independently from Wisconsin’s general budget.  Mr. Howells concluded his remarks commending the efforts of General Beavers in working for the veterans of Kentucky.


General Beavers mentioned some of the recent legislative successes that have shown positive benefits to veterans.  He commended Co-Chair Weaver’s work on a license plate program.  Providing high school diplomas to World War II veterans called to service before graduating was also mentioned.  General Beavers informed the Committee that he could have all discharge papers digitized for $300,000, which would allow the department to handle information requests more efficiently.  The KDVA now also has a website.


Representative Ford asked for clarification as to whether JECVO was giving its support to a tobacco tax and expanded gambling.  Mr. Howells answered that JECVO was not making an official statement on those issues but was only indicating a desire to be included in revenue distributions should either of those initiatives pass.  General Beavers again mentioned the independence of Wisconsin’s veterans department in supporting the idea of a personal loan program.  Representative Ford asked him how much money he needed to start such a program.  General Beavers stated that he had originally requested $5 million, but now he would be interested in just receiving the authority to start the program at which time he would try to find the money.


Co-Chair Weaver instructed the Committee that the next meeting would be at Fort Knox on July 12.  The meeting would begin with a briefing by the United States Recruiting Command and be followed by a Combined Arms Live Fire Training Exercise.


Co-Chair Seum asked the Committee to let LRC staff know of any issues they wished to have considered during the Interim. 


Senator Buford made a motion to adjourn the meeting.  Representative Baugh seconded the motion, and the meeting was adjourned.