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VA restructure may cost jobs

About 54 federal jobs in St. Petersburg would be eliminated under a nationwide plan to consolidate the Department of Veterans Affairs' home loan operations into regional offices by the year 2000.

VA officials vow that veterans' services will improve as a result of the move to the Atlanta regional office, and they promised to provide new jobs for the displaced federal workers or try to relocate them.

The nationwide consolidation is expected to save $25-million over five years and cut the work force by 25 percent through attrition, according to the VA.

"I believe that we have a good, well-thought-out plan that will stand up to scrutiny," said Keith Pedigo, director of the loan guaranty service for the VA.

That scrutiny is under way. U.S. Rep. C.W. Bill Young, whose St. Petersburg-based district would lose the jobs, objected to the consolidation Thursday and argued it would "clearly result in our nation paying more to get less."

Young pointed out that the VA is building a new office on the Bay Pines campus that would provide lower-cost space for the home loan operations. More important, he argued that the St. Petersburg office is one of the nation's busiest and has 54 employees, compared with28 in Atlanta.

"If a consolidation is to occur, it appears it would make far greater economic sense to combine the other offices into St. Petersburg," Young wrote in letters to VA Secretary Jesse Brown and a senior colleague on the House Appropriations Committee.

The VA's reorganization team ranked St. Petersburg third out of the 46 offices, but Pedigo said the department chose against placing a regional loan office in Pinellas County because it is out of the way geographically for the three-state Southeast region, which includes Alabama, Georgia and Florida.

Using the VA criteria, Atlanta ranked No. 1, he said. It will be one of the eight regional offices.

He said the VA ranked the 46 loan offices by using 17 criteria, including effectiveness and productivity of the facility, its level of staffing and the quality of life in the community. Then, the VA chose eight regional sites from that list and decided which outposts to shrink.

Under the plan, two VA home loan operations will move: the loan processing offices, which handle underwriting work, and loan servicing offices, which counsel veterans who are seriously delinquent on their loans.

Since the VA doesn't actually provide the loan _ it guarantees the note _ much of the processing work is already being done by private lenders, Pedigo said, so veterans wouldn't see much of a change with a new location.

To make sure services aren't disrupted, though, the VA will open toll-free lines at the new regional offices and increase their hours of operations to accommodate home loan calls from veterans.

Furthermore, veterans who want to speak to someone in person could still visit the VA office in St. Petersburg, he added. About 50 loan employees will stay in St. Petersburg to handle home loan operations that remain, including the arm that sells foreclosed real estate.

The consolidation is to take place over four years, and St. Petersburg's move is one of the last in line _ beginning in 1999 and continuing into the year 2000.

Pedigo said the VA has altered the deadline for other office closures around the country, and he stressed that "this is just a tentative rollout time for St. Petersburg's restructuring."

_ David Dahl can be reached by e-mail at or by telephone at (202) 463-0576.