Written by William & Mary Student Toren Elsen

Currently veterans in Denver are served by a hospital named the Department of Veterans Affairs (VA) Eastern Colorado Health Care System. This facility dates from 1950 and has become dated with age. Replacing this facility with a more state of the art hospital, to better serve the more than 400,000 veterans in Colorado and surrounding states, has been in the works since 2004. However, building this replacement hospital has run into numerous budgetary and timeline overruns. The most current estimate is that the new VA hospital in Aurora will open on January 23, 2018 and cost around $1.67 billion.[1]

This is a far cry from initial plans. At first, in 2004, the new VA hospital was planned to, at least partially, share facilities with the new University of Colorado Hospital being built on the site of the former Fitzsimons Army Medical Center. This hospital had an initial estimated cost of $328 million. However, the American Legion took a hard line stance against shared facilities. Based in large part on this opposition, Colorado’s delegation to Congress also demanded a separate facility.[2] This separate version of the VA hospital was initially forecast to cost $582.8 million and open in February 2014. However, it quickly became apparent that there would be cost overruns. After some tense negotiations the VA and Kiewit-Turner, the contractor building the hospital, agreed to a $604 million budget in a short hand written agreement in 2011.[3] Importantly, though, the agreement required the VA, somewhat vaguely, to “produce a design” that could be built for the $604 million price.[4] Ultimately Kiewit-Turner ended up suing the VA in July 2013, saying that they had breached the contract by failing to produce a design that could be built for the set amount. In December 2014, the U.S. Civilian Board of Contract Appeals agreed with Kiewit-Turner and found that the VA had breached the contract.[5]

The delay caused by this litigation not only extended the timeline and increased the cost of the project, it also hampered efforts to oversee the VA’s handling of the project. In communicating with Congress, the VA routinely refused to answer questions relating to the project due to ongoing litigation. Additionally, efforts by both Representative Mike Coffman (R-CO) and Senator Michael Bennet (D-CO) to get the Office of Inspector General to investigate were refused because of the litigation.[6] Congress was eventually convinced in the Fall of 2015 to provide $625 million additional dollars to complete the project.[7] However, as part of providing these additional funds, Congress mandated that the Army Corps of Engineers replace the VA in overseeing the project.[8] Now under the Corps guidance, it is hoped that the hospital will open four years behind schedule and over a billion dollars over budget. Given the history of this project, it seems far from certain that even these targets will be met.

Hopefully, once it is completed, the hospital will be able to put the problems of its creation in the past, and will provide excellent care for the veterans of Colorado. In the meantime, though, these veterans are forced to use outdated facilities or potentially even travel out of state for services not yet available in Colorado.[9] After securing the additional funding to complete the project, Senator Cory Gardner (R-CO) promised that once open, the hospital will be “the crown jewel of the VA system.”[10] While this will be a great resource for Colorado veterans, it is glosses over the difficulties such a lengthy construction delay burdens Colorado’s veterans with. If the current 2018 opening date is met, that will be a four year overrun. Four years that veterans in Colorado have had it more difficult day to day to get the care they need.

It is also important to note that the VA’s mishandling of this Colorado project is not a singular event. A 2013 report by the U.S. Government Accountability Office found similar problems at VA projects in Las Vegas, Nevada; New Orleans, Louisiana; and Orlando, Florida.[11] Congress is also taking steps to limit the VA’s role in large construction projects that may be beyond their capacity to effectively manage. Just two weeks ago, on February 9th, the House passed the Construction Reform Act of 2016. This Act will make the Army Corps of Engineers play a larger role in any project larger than $100 million and also requires an external audit of the VA’s handling of the Aurora Hospital.[12] In order to provide the best service it can to veterans, the VA needs to have up to date facilities. Hopefully lessons have been learned from the Colorado construction process and new oversight steps will lead to more timely and cost effective VA hospital construction in the future.

[1] Mark Matthews, VA Hospital Delayed Until Early 2018, But New Contract in Place to Finish Facility, Denver Post (Oct. 30, 2015), http://www.denverpost.com/politics/ci_29048377/new-contract-moves-va-hospital-closer-completion.

[2] Mark Matthews, David Olinger & David Migoya, Anatomy of a Calamity, Denver Post (Aug. 9, 2015), http://extras.denverpost.com/aurora-va-hospital.

[3] November 9, 2011 Agreement, https://www.documentcloud.org/documents/2189928-handwritten-agreement.html.

[4] Id.

[5] Electra Draper & Mark Matthews, Contractor Walking Away From VA Hospital in Aurora, Denver Post (Dec. 9, 2014), http://www.denverpost.com/news/ci_27103393/contractor-kiewit-walking-away-from-va-hospital-aurora.

[6] Anatomy of a Calamity, supra note 2.

[7] VA Hospital Delayed, supra note 1.

[8] Id.

[9] Anatomy of a Calamity, supra note 2.

[10] Mark Matthews, Congress agrees to deal to fund VA hospital in Aurora, Denver Post (Sept. 30, 2015), http://www.denverpost.com/politics/ci_28900686/congress-agrees-deal-va-hospital-aurora?source=pkg.

[11] U.S. Gov’t Accountability Office, GAO-13-302, VA Construction: Additional Actions Needed to Decrease Delays and Lower Costs of Major Medical-Facility Projects (2013), available at http://www.gao.gov/products/GAO-13-302.

[12] Construction Reform Act of 2016, H.R. 3106, 114th Cong. (2016).