Last December, the Civilian Board of Contract Appeals, a tribunal within the General Services Administration, found that the Department of Veterans Affairs (VA) was in material breach of a contract with Kiewit-Turner—a joint venture between Kiewit Building Group and Turner Construction—on the massive Denver VA Medical Center project in Aurora, Colo.
That project was already years behind schedule and hundreds of millions of dollars over budget. Upon that ruling, Kiewit-Turner—which has been on this project since 2010, when it broke ground—stopped work on that project, which at the time was somewhere between 40% and 60% complete, according to the Denver Business Journal. Work resumed just before Christmas only after VA and Kiewit-Turner signed a $234 million bridge-loan agreement.
The Board stated in its decision that the VA had repeatedly failed to provide a design for the hospital that could be built for the original agreed-upon price of $604 million. The VA, according to the Board, also disregarded cost-cutting suggestions and warnings that the project’s ambitions would greatly exceed its budget.
In fact, in the spring of 2013, The Government Accountability Office (GAO) had issued a report that found the Aurora project and three other VA projects were all drastically over budget and behind schedule.
The 182-bed medical center was supposed to be completed early this year. Kiewit-Turner, in June 2013, estimated that the construction cost would actually be $1.085 billion. (At that time, Glenn Haggstrom, who managed VA’s construction projects, continued to insist the hospital could be brought in for its original budget.)
The VA’s Deputy Secretary Sloan Gibson admitted in July that his agency could not produce a line-by-line accounting that would explain the overspending.
In March, Colorado’s congressional delegation requested that the Senate Veterans Affairs committee conduct a field visit to the medical center, which was planned to serve 82,700 vets. The fear was that work would stop again without Congressional approval for the appropriation of additional funds.
Now, the project’s completion date has been pushed back to Jan. 23, 2018, and the total cost is now expected to reach at least $1.67 billion. The U.S. Army Corps of Engineers late last month awarded the construction team a $571 million contract to finish the job.
Congress had authorized up to $625 million in additional spending for this project in September, but not without strings attached, according to news reports. That approval stripped the VA of its authority on any future construction project over $100 million, which essentially would prevent the department from getting involved in hospital construction again.
The Army Corps of Engineers will henceforth serve as the VA”s construction agent on several products worth about $3.6 billion.
"We must make sure that this never happens again and fortunately, a key reform was passed along with funding. The VA is out of the hospital building business," stated U.S. Rep. Mike Coffman (R-Aurora). Coffman told Stars and Stripes that he was disappointed that the VA might not release the results of one of its internal investigations into what went wrong until next year.
Related Stories
Healthcare Facilities | Jul 9, 2019
Tampere psychiatric clinic features a modern, locally rooted ambiance for patients and staff
C.F. Møller Architects is designing the project.
Healthcare Facilities | Jul 2, 2019
Veterans' mental health needs are central to Seattle VA's design
Called the Seattle Veterans Affairs Mental Health and Research Building, the structure is meant to enhance patient care.
Healthcare Facilities | May 24, 2019
Beyond the corner store: Where retail health is headed
New players are redefining what retail health might look like by embracing technologies including mobile apps, telehealth, and artificial intelligence.
Healthcare Facilities | May 16, 2019
ASU Health Futures Center combines a novel design and approach to learning
The trapezoidal shape of the building is an eco-friendly feature.
Healthcare Facilities | May 9, 2019
Construction of new children’s hospital addition in NW Florida had to weather several storms
Patient and staff care were primary concerns during this 25-month project, says its GC.
Healthcare Facilities | May 3, 2019
The healthcare sector is turning to drones to supplement medical services
Leo A Daly’s Miami studio envisions a drone-powered hospital that enhances resilience to natural disasters.
| Apr 26, 2019
Greenwich Hospital upgrades boilers to improve operational efficiency
Greenwich Hospital, in Greenwich, Conn., chooses new Miura boilers.
Healthcare Facilities | Apr 15, 2019
It’s official: China opens first green hospital, designed by HMC Architects
Shunde Hospital of Southern Medical University is the official pilot green hospital for development of China’s green guide for hospital design.
Healthcare Facilities | Apr 12, 2019
New health pavilion completes on the Health Education Campus at Case Western Reserve University
Foster + Partners designed the facility.
Healthcare Facilities | Apr 9, 2019
How healthcare organizations can leverage design and culture's symbiotic relationship
The relationship between workplace design and company culture isn’t all that different from a tango.