May 21, 2015 12:54 PM
VA nearly out of cash for half-done, budget-busting hospital
The Associated Press
DENVER (AP) A vast, half-finished veterans hospital in suburban Denver is mired in an embarrassing scandal with $1 billion in cost overruns, and the VA is struggling to persuade skeptical lawmakers to keep the money flowing.
The Veterans Affairs Department said it will run out of cash and construction will stop next week unless Congress raises the project's $800 million spending cap by Sunday. The contractor says a shutdown would delay the project by months and raise the cost beyond the current estimate, $1.73 billion.
House Speaker John Boehner rejected the latest proposal from the VA to avert a shutdown, according to Rep. Mike Coffman, a Republican whose district includes the hospital.
The VA asked Congress to approve additional spending and keep construction going with money already in hand while sorting out a longer-term plan. It also offered to cut the cost by about $55 million by indefinitely delaying construction of a nursing home and a post-traumatic stress disorder clinic on the hospital campus.
Boehner wants more cuts and a plan to pay for the entire project, not just to keep construction moving for a few months, Coffman said.
Coffman took an unusual swipe at a leader of his own party Wednesday, saying he was disappointed Boehner wouldn't approve a short-term deal to avoid a shutdown.
In a statement to The Associated Press, Boehner said the issue is bigger than the Denver hospital.
"It is about the continuing culture of irresponsibility at the Veterans Administration," he said. "The VA needs to produce a plan to complete this project on-time and on-budget."
The chances of reaching a deal to avoid a shutdown were uncertain at best, and Congress is scheduled to begin a weeklong Memorial Day recess this weekend.
VA Secretary Robert McDonald said Wednesday he had made numerous reasonable proposals to Congress and all were rejected. Republican Rep. Jeff Miller of Florida, chairman of the House Veterans Affairs Committee, told McDonald: "VA created the mess in Denver, so the department must come up with a plan to fix it that does not add to the deficit and does not jeopardize the benefits and services of other veterans.
Veterans are worried and feel caught in the middle.
"It would be devastating for the veterans of Colorado for Congress not to pass this and let it get shut down," said Steven Rylant, president of the United Veterans Committee of Colorado, a coalition of veterans groups.
"This a regional medical center we're talking about," Rylant said. "It doesn't just affect Colorado, but states around the region, so it's incredibly important to get it finished."
As recently as last year, the VA said the hospital would cost about $600 million, and the reasons it spun out of control have yet to be fully explained. The VA has said the plans weren't complete when work began, and VA construction executives tried to switch to a different type of design-and-build process too late.
At least two internal VA investigations are underway, and the department says all the key executives on the project have been replaced some were demoted or transferred, and another retired one day after investigators interviewed him under oath. But no one has been fired, angering many in Congress.
The ambitious, 184-bed medical center in suburban Aurora is a collection of a dozen large interconnected buildings that would replace an old and overcrowded facility operating in Denver.
But the VA and contractor Kiewit-Turner couldn't agree on costs and plans, and a panel of judges ruled in December that the VA had breached the contract because the hospital couldn't be built for the agreed-upon price of about $600 million.
Construction stopped, and recriminations started.
Senators and representatives accused the VA of arrogance, deceit and incompetence. Colorado lawmakers said they had been trying to get answers from the VA for months, even before the December ruling.
Construction resumed at a scaled-back pace under an interim contract while a new contract is negotiated with Kiewit-Turner, but if the money runs out, it will stop again.
The VA says it needs another $830 million to finish the hospital as currently designed, or about $775 million without the nursing home and PTSD clinic.
The VA wants to tap a $5 billion fund Congress approved to resolve another scandal, long wait times for veterans seeking health care, but that has encountered strong opposition.
Sen. Richard Blumenthal, D-Conn., said during a Senate Veterans Affairs Committee hearing in Aurora last month that "veterans elsewhere cannot be forced to sacrifice just because of the catastrophe here."
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