Op-Ed: How the $1.7 billion VA boondoggle got unbungled

By: Rep. Mike Coffman

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Washington, July 20, 2018 | comments


The Rocky Mountain Regional VA Medical Center located in Aurora is officially opening soon. This is a great thing for our veterans and for our community, but it arrived years late and cost the taxpayers far more than it should have. Plagued by years of mismanagement by the Department of Veterans Affairs, I’m convinced that if not for the U.S. Army Corps of Engineers, who took over the construction management of the hospital in 2015, this day might never have come.

At the end of the day, at a price tag of over $1.7 billion, the new VA hospital will be double the square footage of the old hospital but will have the same number of beds. Also, there are fewer primary care exam rooms at the new hospital requiring seven existing Patient Aligned Care Teams to be left on the first floor of the old hospital on Colorado Boulevard until additional outpatient space can be found.

Operating both medical centers was never part of the plan.

On January 3, 2013, I became the congressman for a newly redrawn 6th Congressional District that included the construction site for the replacement VA hospital on the Anschutz Medical Campus. Prior to 2013, Congressman Ed Perlmutter represented the hospital construction site, and his predecessor, former Congressman Bob Beauprez, represented the area from 2003-2007 when the planning for the VA hospital started.

Knowing how important this project was to our veterans, I asked that same month to be moved to the Veterans Affairs Committee where I was appointed to be the chairman of the Oversight and Investigations Subcommittee. This gave me a unique vantage point to monitor the progress of the construction project.

Immediately, I saw the disconnect between what the construction management team for the Aurora project was officially reporting to Congress and what I was hearing privately from concerned VA employees and subcontractors working onsite. Early in 2013, I began to receive internal emails revealing that senior VA leaders clearly knew that the costs of the project were spiraling out-of-control and pushing it well beyond the authorized budget cap of $600 million. When I openly challenged the VA about these costs overruns and the construction delays, they repeatedly responded with misleading narratives that all was going “just fine.”

In fact, all was not “just fine.” In April 2013, the Government Accountability Office (GAO) issued a 33-page report condemning the VA for its hospital construction management practices and said that all four major hospital projects then underway: Orlando, Las Vegas, New Orleans, and Aurora, were disasters. “For VA’s four largest medical-facility construction projects, when comparing November 2012 construction project data with the cost and schedule estimates first submitted to Congress, cost increases ranged from 59 percent to 144 percent, representing a total cost increase of nearly $1.5 billion and an average increase of approximately $366 million per project. The schedule delays ranged from 14 to 74 months with an average delay of 35 months per project.”  The report projected the biggest cost increase of 144 percent for the Aurora hospital.

To highlight the challenges of getting straight answers, the September 21, 2016 Office of Inspector General (OIG) report stated that the VA construction executive, Glenn Haggstrom, “did not share [the] information with Congress” concerning  the cost overruns. Another VA executive who had her fingerprints all over the cost overruns was Stella Fiotes, the executive director of the Office of Construction and Facilities Management for the VA since 2013. She succeeded Haggstrom and she was equally evasive.

Fiotes still holds the same position with the VA despite her office’s extraordinary failures.

Throughout the 2013 GAO report there were multiple references to the U.S. Army Corps of Engineers’ construction management policies and procedures that the VA could adopt in order to improve its practices, particularly given that the Army Corps of Engineers has a record of building similar facilities for the Department of Defense within budget and on schedule.

After reading this GAO report and recognizing that the VA Office of Construction and Facilities Management was not providing honest answers to the subcommittee that I chaired, I decided to push for legislation that would replace the VA with the Army Corps of Engineers at all four construction sites. No doubt, the VA is an organization that should be focused on their core mission of providing the health care and benefits that our veterans have earned through their military service and not on construction management, which they clearly don’t have the competence to do.

On November 21, 2013, I introduced the VA Construction Assistance Act of 2014, to strip the VA of its construction management authority on all four major hospital construction projects and put the Army Corps of Engineers in charge. The legislation passed the House unanimously.

Three months later, the general contractor for the Aurora VA hospital, Kiewit-Turner, prevailed in a lawsuit against the VA at the Civilian Board of Contract Appeals claiming that the VA breached its contract through its mismanagement of the project. The remedy that the court gave Kiewit-Turner was that that they were no longer obligated to the contract and were free to cease all work and walk off the project. Kiewit-Turner agreed to stay on and to continue working at the hospital construction site only if the Army Corps of Engineers took over construction management responsibilities in accordance with the House-passed bill. The VA immediately began the transition process and the Army Corps of Engineers completely took over by April 2015. This change, inspired by my legislation, gave Congress enough confidence to continue funding the Aurora VA hospital through its completion.

Subsequently, to reassure a failure of this magnitude never occurs again, I led the effort in the House to pass a provision in the VA Expiring Authorities Act of 2015 to permanently strip the VA of their construction management authority for projects of $100 million or more. This effectively forces them to use another federal entity, such as the Army Corps of Engineers, the Naval Facility Engineering Command, or the General Services Administration, to manage their hospital construction projects.

When I think about our nation’s obligations to our veterans who have sacrificed so much in defense of our freedom and who will finally receive health care from a new VA hospital that they have waited so long for, I will also give thanks to the men and women of the U.S. Army Corps of Engineers who have made this hospital possible.

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U.S. Rep. Mike Coffman is a Marine Corps combat veteran and a member of the House Veterans Affairs Committee and Armed Services Committee.

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