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“Digital G.I. Bill Undelivered: Contracting Challenges and the Need for Acquisition Reform”

House Veterans Affairs Committee, Technology Modernization and Economic Opportunity Joint Subcommittee Hearing

February 4, 2026 (recording here)

HEARING INFORMATION

Witnesses & Written Testimony (linked) (Panel One):

• Mr. Kenneth Smith: Executive Director at Education Service, Veterans Benefits Administration, Department of Veterans Affairs

• Mr. Raymond Tellez: Executive Director, Veterans Benefits Administration, Department of Veterans Affairs

• Mr. Jeffrey Neill: Associate Executive Director, Office of Procurement, Acquisition and Logistics, Technology Acquisition Center, Department of Veterans Affairs

• Mr. Robert Orifici: Executive Director of Benefits and Memorial Services, Office of Information Technology, Department of Veterans Affairs

Witnesses & Written Testimony (linked) (Panel Two):

• Mr. Justin Parke: Managing Director, Digital GI Bill Program Manager, Accenture Federal Services

• Mr. Troy Mueller: Managing Director, Integrated Benefits Operations & Technology Division, MITRE

• Mr. William Hubbard: Vice President for Veterans & Military Policy, Veterans Education Success

TOP-LINES TO SHOW YOU ARE IN THE KNOW

1. The Digital GI Bill didn’t fail because of one bad technical issue, but because the contract was awarded before the VA fully understood the scope, risks, and legacy system complexity.

2. Members across both parties pushed back on the idea that ballooning costs were unavoidable, questioning why foreseeable changes like legislation and court rulings were not built into the original acquisition plan.

3. A recurring frustration was that no single office or leader appeared clearly accountable for the program, even as costs doubled and veterans experienced real harm from delayed payments.

4. Witnesses and members repeatedly connected contracting and IT decisions to real-world consequences, including housing instability, financial stress, and erosion of trust among veterans and survivors.

5. There was broad agreement that without stronger upfront planning, clearer ownership, and real accountability, the VA risks repeating the same modernization failures across future programs.

PARTY LINE PERSPECTIVES

OPENING STATEMENTS FROM THE SUBCOMMITTEES

• Chairman Tom Barrett explained that the Digital GI Bill was intended to modernize benefit delivery but instead had been plagued by mismanagement, unclear requirements, cost overruns, and delays that harmed veterans and schools. He shared that the program’s costs had more than doubled into the billions while veterans missed housing payments and faced bureaucratic barriers. He claimed that the hearing aimed to identify what went wrong and to pursue acquisition reform and accountability across the VA to prevent similar failures.

• Ranking Member Nikki Budzinski expressed appreciation for bipartisan oversight of the Digital GI Bill but said its recent failures stemmed from poor planning, policy decisions, and weak contract management rather than technical glitches. She noted that these challenges mirrored broader, systemic problems across the VA’s modernization efforts. She cited multiple reports from the VA Office of Inspector General (OIG) and other watchdogs highlighting recurring issues such as inadequate planning, insufficient stakeholder engagement, and failure to address known problems. The Ranking Member raised concerns about whether the VA had truly implemented corrective actions and whether it could apply lessons learned to future contracts amid workforce constraints.

• Chairman Derrick Van Orden stated that the hearing’s goal was to get the Digital GI Bill back on track and ensure veterans reliably received the education benefits they earned through service. He criticized the program for ballooning from a multimillion-dollar effort into a multibillion-dollar project while continuing to delay payments to student veterans. The Chairman argued that the VA had a history of failing at large-scale IT infrastructure projects and said the cost overruns were inexcusable to veterans and taxpayers alike. He called for accountability from VA leadership and reiterated that systems should serve veterans, not internal bureaucratic processes.

• Ranking Member Chris Pappas supported the oversight of VA education benefits but criticized the hearing’s structure and lack of witnesses representing veterans, watchdog agencies, or accountable decision-makers. He argued that the payment delays were caused by VA management decisions and poor planning, not contractor failure, particularly the flawed rollout of data reconciliation before the fall semester. The Ranking Member detailed the VA’s failure to communicate transparently with beneficiaries, Congress, and the public, calling it an inexcusable political decision. He demanded individual accountability for decisions that harmed veterans and urged the Committee to rise above partisanship to enforce real consequences.

SUMMARY OF KEY POINTS (PANEL ONE)

• Mr. Kenneth Smith testified that the Digital GI Bill had enabled the VA to deliver benefits faster, improve customer service, and replace outdated legacy systems despite acknowledged challenges. He said the program had met major milestones, processed significantly more claims since 2021, and achieved high automation rates with accuracy comparable to human processing. Mr. Smith acknowledged that the original contract underestimated complexity and that legislative changes and court decisions expanded the scope and costs over time. He underscored that the VA had improved program management through agile methodologies, cost controls, and ongoing releases focused on delivering benefits more efficiently to veterans and their families.

• Chairman Barrett asked whether it would be beneficial for the VA to establish an independent office to provide cost estimates and program evaluations for large modernization efforts like the Digital GI Bill. Mr. Smith responded that he did not believe program management should be outside the business line, arguing that subject matter expertise resided within Education Service. Chairman Barrett pressed on whether a more IT-agnostic, centralized implementation office might prevent delays and cost overruns, but Mr. Smith maintained that the program had delivered strong outcomes, including automation of 65 percent of claims and decommissioning multiple legacy systems.

• Chairman Barrett asked whether the VA shared lessons learned and best practices across offices to avoid repeating past IT failures. Mr. Robert Orifici responded that lessons learned were shared across IT and program offices through regular meetings. When asked whether this was a formal process, the witnesses acknowledged that it was largely informal but said information was still routinely shared among relevant groups.

• Ranking Member Budzinski asked who ultimately led the acquisition of the Digital GI Bill, given the involvement of multiple VA entities. Mr. Smith stated that, as Executive Director for Education Service, he was the responsible official. The Ranking Member then asked whether anything could have been handled differently to mitigate cost growth and delays, and Mr. Smith replied that challenges stemmed from underestimated complexity, legacy system transitions, and unplanned scope additions rather than confusion among offices.

• Ranking Member Budzinski questioned how the VA planned to perform life-cycle cost estimates after ending its contract with MITRE. Mr. Smith answered that the VA was considering either bringing the work in-house or finding another solution. When asked whether the VA now fully understood its requirements and who would revise future estimates, he said his office would oversee the process and expressed confidence the VA understood the remaining scope, though new requirements could still arise.

• Rep. Abe Hamadeh asked what steps the VA had taken to ensure its cost estimates were accurate and whether they followed the Government Accountability Office’s estimating guide. Mr. Smith responded that MITRE prepared the most recent estimate using the GAO guide and said the program’s actual costs fell within the estimated range. When asked whether requirements could continue to grow, he acknowledged that new legislation and court decisions could necessitate additional changes.

• Rep. Hamadeh then asked whether unpaid contractor invoices were preventing the release of new capabilities. Mr. Smith stated that the VA had not withheld payments and clarified that contractors were paid in arrears. When questioned about whether the VA had sufficient staff and expertise to manage the program despite delays and cost growth, Mr. Orifici replied that he was confident in current staffing and that cost increases reflected expanded scope and higher claim volumes under a managed services contract.

• Ranking Member Pappas questioned why the VA failed to communicate with Chapter 35 beneficiaries during September and October, despite knowing early in September that serious payment issues existed. Mr. Smith responded that the VA preferred to communicate but was constrained by the Anti-Deficiency Act during the shutdown and believed it could resolve the issue before delays became widespread. The Ranking Member rejected that explanation, citing prior shutdown communications and public activity by VA leadership, and asked who directed the VA not to communicate. Mr. Smith reiterated that the VA followed legal restrictions tied to shutdown guidance.

• Ranking Member Pappas asked for an update on enrollment verification requirements following widespread confusion among beneficiaries. Mr. Smith responded that verification had been reinstated that month, that approximately 142,000 of 170,000 beneficiaries had responded, and that the VA had issued reminders to remaining students while offering assistance to complete verification. The Ranking Member claimed that the lack of communication had broken trust with veterans and said the failure was inexcusable.

• Rep. Kimberlyn King-Hinds asked when the VA internally acknowledged the Digital GI Bill was at risk and when Congress was notified. Mr. Orifici responded that Congress and Committee staff had received regular updates since 2018 through hearings and monthly briefings. When asked about cost growth, the witnesses stated that costs increased due to added scope, legacy system complexity, congressional mandates, and court requirements rather than simple overruns.

• Rep. King-Hinds questioned why the VA continued renegotiating rather than pausing the program as costs escalated and asked whether OIG recommendations had been addressed. Mr. Smith replied that all OIG recommendations had been closed. He said the VA was focused on increasing automation beyond 65 percent to reduce disruptions and acknowledged that future rollouts should avoid peak enrollment periods when possible.

• Rep. Delia Ramirez questioned whether the VA had the institutional readiness and staffing capacity to manage a $2 billion modernization effort amid workforce disruptions. Mr. Smith responded that staffing had been increased, that approximately 25 personnel managed the program with contractor and IT support, and that leadership believed staffing levels were sufficient.

• Rep. Ramirez asked how oversight and investigation functions ensured credible cost estimates. Mr. Orifici responded that they continued to work with technical experts to validate estimates against industry standards and acquisition expectations.

• Rep. Sheila Cherfilus-McCormick asked whether the VA used the Acquisition Lifecycle Framework when acquiring the Digital GI Bill contract. Mr. Jeffrey Neill stated that the framework was still under development at the time and had not been fully applied to the acquisition. He acknowledged uncertainty about which framework was used and said documentation should exist in contracting records.

• Rep. Cherfilus-McCormick then questioned why alternative frameworks with clearer milestones were not used and how the Acquisition Lifecycle Framework would be applied going forward. Mr. Neill replied that the framework was intended to improve requirement definition, cost estimation, and evaluation of alternatives for major programs. He acknowledged the department would need to provide additional documentation comparing frameworks and acquisition decisions.

• Chairman Van Orden aggressively questioned the original $453 million budget, the timeline for awarding the contract, and the absence of clear success metrics. Mr. Smith responded that he could not immediately provide the timeline and reiterated that legislative changes and court rulings expanded program requirements. The Chairman criticized VA leadership for failing to conduct proper mission planning, lacking accountability structures, and failing to define quantifiable goals, and he ended the exchange by dismissing the panel.

SUMMARY OF KEY POINTS (PANEL TWO)

• Mr. Justin Parke testified that Accenture began supporting VA education benefits modernization after a prior failed implementation and had successfully delivered earlier systems on time and on budget. He held that the company met the core objectives of the Digital GI Bill contract by enabling uninterrupted claims processing, retiring legacy systems, and significantly increasing automation, with more than 64 percent of claims processed the same day. Mr. Parke acknowledged challenges stemming from expanded scope due to legislation, court decisions, and dependencies outside the program’s control. He then argued that Accenture’s contract costs were within the approved life-cycle cost estimate and that the program generated substantial long-term cost avoidance for the VA while delivering faster benefits to veterans.

• Mr. Troy Mueller explained that MITRE served as an independent advisor supporting VA modernization through systems engineering, program integration, and cost estimation. He stated that MITRE produced annual life-cycle cost estimates for the Digital GI Bill from 2021 through April 2025, reflecting changes driven by legislation, court rulings, and program realities. He reported that the estimated total program cost was approximately $2.3 billion in constant dollars over ten years, rising to about $2.6 billion when adjusted for inflation. He recommended that the VA establish an enterprise-level cost estimating function paired with an early acquisition model to improve transparency, oversight, and delivery of future modernization efforts.

• Mr. William Hubbard claimed modernization was necessary but argued that technology changes that delayed benefits constituted disruption rather than progress. He said the Digital GI Bill followed a long pattern of VA technology rollouts that caused widespread payment delays, leaving thousands of students struggling with housing, food, and transportation. According to him, the VA failed to communicate proactively with beneficiaries, particularly during the government shutdown, which compounded financial harm and eroded trust. Mr Hubbard advocated for reforms, including treating education benefits as essential services, avoiding system rollouts during academic terms, requiring independent testing, improving communication, and adopting performance metrics centered on the veteran experience.

• Ranking Member Budzinski asked about the risks of the VA lacking sufficient in-house expertise to perform reliable life-cycle cost estimates amid staffing losses. Mr. Mueller responded that cost estimation required highly trained professional cost estimators, not contracting officers, and that such capability would need deliberate planning and resourcing. He said that he could not assess the VA’s current internal capacity because it fell outside his direct area of support.

• Ranking Member Budzinski inquired whether it was accurate that the VA had not held monthly stakeholder calls for the Digital GI Bill since December 2024. Mr. Hubbard confirmed this and said the lack of engagement significantly worsened the impact of payment delays by preventing veteran service organizations and schools from planning or intervening. He explained that the absence of communication eroded trust and left veterans vulnerable to eviction and financial crisis.

• The Ranking Member then asked about the broader impact of VA contracting and IT failures on veterans and beneficiaries. Mr. Hubbard stated that repeated payment delays undermined veterans’ trust in VA, particularly when the agency possessed extensive personal information but still failed to deliver earned benefits on time. He underlined that these failures had real consequences for veterans’ stability and well-being.

• Rep. King-Hinds asked Mr. Mueller to explain his recommendations for enterprise-level cost estimating and early acquisition models in plain terms. Mr. Mueller explained that early analytical work brought together users, contracting professionals, business leaders, and IT staff to define mission needs, requirements, options, and costs before launching a program. He said this upfront collaboration enabled better-informed decisions, stronger contracts, and more realistic expectations.

• Rep. King-Hinds followed up on how “known unknowns,” such as future legislation and court mandates, should be handled in contracting and cost estimates. Mr. Mueller replied that life-cycle cost estimates accounted for these risks through ranges and sensitivity analysis, though not all unknowns could be predicted. He noted that GAO guidance typically recommended budgeting at a 50 percent confidence level while acknowledging that additional changes were inevitable over time.

• Ranking Member Pappas asked whether Accenture delivered Release 8 on time and on budget. Mr. Parke responded that the original deadline for retiring the legacy system was September 2022 and that Release 8 was ultimately delivered in August 2025 due to factors previously discussed in testimony. He stated that Accenture responded quickly to the VA’s request to automate Chapter 35 data reconciliation and had a solution ready by October, though deployment was delayed by shutdown-related staffing constraints.

• The Ranking Member asked when Accenture became aware of the Chapter 35 backlog. Mr. Parke stated that Accenture was notified as soon as the VA recognized the issue and immediately began developing automation, which was deployed in mid-November. Ranking Member Pappas then invited Mr. Hubbard to elaborate on beneficiary impacts, and Mr. Hubbard stated that payment failures damaged trust in the VA and discouraged veterans from relying on the institution for broader support, including mental health services.

• Rep. Ramirez questioned whether Accenture had flagged risks related to release timing, testing capacity, and manual reconciliation. Mr. Parke confirmed that Accenture raised these risks and said the VA made decisions based on the information available at the time. He added that, in hindsight, delaying deployment further might have reduced risk but would have required postponing implementation for an additional year.

• Rep. Ramirez asked whether the risk communication process between Accenture and the VA was functioning effectively and what improvements were needed. Mr. Parke admitted that the process had weaknesses in the past but had improved under newer leadership. He said clearer engagement and stronger acquisition practices offered the greatest potential for future improvement.

• Chairman Van Orden questioned the average length of time veterans went unpaid and suggested creating contingency funding to protect beneficiaries during system failures. Mr. Parke responded that the average claim completion time was approximately 5.6 days, but did not have data on the unpaid duration. The Chairman criticized the lack of accountability for repeated failures, argued that no individuals or contractors had faced consequences, and concluded that systemic leadership and governance failures continued to harm veterans.

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