Finds that: (1) A significant number of Washington citizens answered the call to serve our country in recent military action leaving behind families, community, employment, and education;

(2) Many soldiers returning to their families and communities face transition problems in areas such as family reunification, employment, education, and health;

(3) While the Washington state department of veterans affairs has provided services to many returning soldiers, a significant number have returned to families and communities without continuing ties to the military department or veterans' administration, but still in need of help; and

(4) Our state needs to honor and serve those who have protected our security and safety.

Creates in the department a veterans innovations program, which consists of the defenders' fund and the competitive grant program. The purpose of the veterans innovations program is to provide crisis and emergency relief and education, training, and employment assistance to veterans and their families in their communities.

Creates the defenders' fund to provide assistance to members of the Washington national guard and reservists who served in Operation Enduring Freedom, Operation Iraqi Freedom, or Operation Noble Eagle, and who are experiencing financial hardships in employment, education, housing, and health care due to the significant period of time away from home serving our country. The program shall be administered by the department. Eligibility determinations shall be made by the department. Eligible veterans may receive a one-time grant of no more than five hundred dollars.

Appropriates the sum of ten million dollars, or as much thereof as may be necessary, from the state general fund for the fiscal year ending June 30, 2006, solely for deposit in the veterans innovations program account created in this act.

Appropriates the sum of six million dollars, or as much thereof as may be necessary, for the fiscal biennium ending June 30, 2007, from the veterans innovations program account to the department of veterans affairs solely for the purposes of this act. Of this amount, two million dollars is provided solely for the defenders' fund in section 4 of this act and four million dollars is provided solely for the competitive grant program in section 5 of this act.