There is hereby created a department of government to be known as the Department of Veterans' Affairs. The chief administrative officer of the department shall be the director to be known as the Director of Veterans' Affairs. He or she shall be appointed by the Governor, subject to confirmation by the Legislature. No person shall be eligible to receive appointment as director unless such person has the following qualifications: (1) Resident of the State of Nebraska for at least five years immediately prior to his or her appointment; (2) citizen of the United States; and (3) served in the armed forces of the United States during any of the periods identified in section 80-401.01 and discharged or otherwise separated with a characterization of honorable from such service. The director shall serve until a new director to succeed him or her is appointed and has qualified. If a vacancy occurs in the office of director when the Legislature is not in session, the Governor shall make a temporary appointment until the next meeting of the Legislature, when the Governor shall present to the Legislature a recommendation for the office. The director shall receive an annual salary to be fixed by the Governor, payable in equal monthly installments. He or she shall be reimbursed for expenses involved in the performance of his or her official duties as provided in sections 81-1174 to 81-1177. He or she shall be bonded or insured as required by section 11-201. The director shall appoint state service officers and assistants, whose appointments shall be approved by the Veterans' Advisory Commission.

The department shall be the designated state agency to advocate on behalf of veterans.