Veterans Compensated Work Therapy Program Improvements Act of 1989

Veterans Compensated Work Therapy Program Improvements Act of 1989 - Amends the Veterans' Benefits and Services Act of 1988 to extend through FY 1994 a pilot program for the provision of care and treatment and rehabilitative services to homeless veterans suffering from chronic mental illness disabilities. Authorizes the Secretary of Veterans Affairs, in contracting for the provision of therapeutic and rehabilitative activities for veterans, to contract with any appropriate source, including a department or agency of the Government, for the provision of such services. (Currently, such contracts are limited to private industry or other sources outside the Department of Veterans Affairs.)

Authorizes use of the Special Therapeutic and Rehabilitation Activities Fund of the Department for the payment of travel and related expenses necessary for the provision of such therapeutic and rehabilitative services or for the training of employees in the administration of such services.

Authorizes the Secretary to purchase, lease, or otherwise acquire residential housing and operate each residence as transitional housing solely for veterans who are: (1) furnishing work therapy services to the Department; and (2) furnished therapeutic work. Outlines the following conditions for the operation of such transitional housing: (1) that homeless veterans have priority in filling housing vacancies; (2) that only qualified veterans and a house manager live in such residence; (3) that each resident (other than the house manager) pay the Department rent for the period of residence in such housing; (4) that, in the establishment and operation of such housing, the Secretary must comply with all local zoning, building, and other similar requirements; and (5) that the residence meet the State and community fire and safety requirements applicable to property used for similar purposes. Outlines further administrative provisions concerning: (1) qualifications and payment of house managers; and (2) suitable property for use as such transitional housing. Outlines provisions for the payment of the cost of such property used for such purposes. Requires the Chief Medical Director of the Department to be responsible for the management, maintenance, and disposition of such property. Directs the Secretary to prescribe: (1) reasonable rental rates for persons residing in such housing; and (2) appropriate limits on the period for which such persons may reside in transitional housing. Authorizes the Secretary to dispose of property no longer used for such purposes. Authorizes the use of the Special Therapeutic and Rehabilitation Activities Fund for the purchase of property to be used for transitional housing under this Act.

Authorizes the Secretary to establish one or more nonprofit corporations to provide a flexible funding mechanism for the conduct of Department compensated work therapy programs for veterans (including homeless veterans) in such community or communities as the Secretary may designate. Regards such corporations as private nonprofit corporations for purposes of compliance with Federal laws. Provides that such a corporation shall be established solely to facilitate the conduct of work therapy programs for veterans. Requires such corporation to be considered under the Internal Revenue Code as a tax-exempt corporation within three years of its establishment or be dissolved by the Secretary. Requires funds received by the corporation to be transferred to the Special Therapeutic and Rehabilitation Activities Fund and used for its purposes. Outlines administrative provisions concerning the board of directors, general powers, and State law applicable to such nonprofit corporations. Requires all records of such corporations to be available to the Secretary. Requires corporations to submit to the Secretary an annual report providing a detailed statement of operations, activities, and accomplishments during that year. Requires annual independent audits of corporations. Requires each member of the board of directors and each employee of the corporation to be subject to all Federal conflict-of-interest laws and to certify annually to the Secretary that the director or employee has complied with all such laws. Directs the Secretary to submit an annual report to the Senate and House Veterans' Affairs Committees on the number and locations of such corporations established under this Act. Directs the Secretary, no later than February 1, 1992, to report to the Congress on the experience through the end of FY 1991 concerning the establishment and operation of such corporations. Prohibits any such corporation from being established after FY 1992.

Directs the Secretary to transfer a specified amount of funds to the Special Therapeutic and Rehabilitation Activities Fund to be used for the continuation of the pilot program for the provision of care and treatment and rehabilitative services to homeless veterans suffering from chronic mental illness disabilities.