St. Paul VA executive demoted, transferred to another state

WASHINGTON – Officials with the U.S. Department of Veterans Affairs said Friday they demoted top St. Paul veterans benefits director Kim Graves and that she will be an assistant director in another state.

Graves is under fire after the VA Inspector General in September found she choreographed a move to Minnesota from the East Coast, receiving almost $130,000 in moving expenses and retaining her salary of $173,949 for a lot fewer responsibilities in her new job. The Inspector General referred Graves' case, along with several others, to federal authorities for potential prosecution.

In a statement released late Friday, the VA said that Graves, and another woman in trouble for similar allegations in Philadelphia, will be assigned assistant director positions in other states and they will immediately go to lower level positions within the Veterans Benefits Administration, which means a pay cut.

The VA did not respond to questions about Graves' new salary Friday, nor did they say where she is heading from Minnesota. Her new position will likely come with a salary of at least $100,000 a year. It was not immediately clear whether she will receive additional relocation money.

The VA has not taken steps to make Graves pay back her relocation allowance — a decision that outraged U.S. Rep. Jeff Miller, R-Fla., chairman of the House Veterans Affairs Committee.

"Because of the department's failure to adequately hold employees accountable in this and many other situations, VA is being forced to tolerate corruption, malfeasance and incompetence within its ranks," he said in a statement Friday. "As a result it remains under the shadow of perpetual scandal. The millions of American veterans who depend on VA and the hundreds of thousands of VA employees who are dedicated professionals deserve better than this broken status quo."

Miller's committee has been scrutinizing the VA brass, performance and salaries for the past year. In October, committee members, including Rep. Tim Walz, D-Minn., subpoenaed Graves and some of her colleagues to testify about the Inspector General's allegations. The investigators found broad misuse of the VA's relocation programs and the incentives that go along with moving to another city to work for the department.

"We need greater transparency, accountability and a fundamental culture shift at the VA," Walz said. "This is one more example of why."

When Graves arrived in Washington, she immediately invoked the Fifth Amendment, which protects a person from making any self-incriminating statements.

Earlier in November, the committee reported that, amid the inspector general's investigation, Graves received a bonus of $8,697 in 2014.

Allison Sherry • 202-383-6120