After Denver hospital debacle, VA should leave building to the pros

The billion-dollar Department of Veterans Affairs hospital construction project in Denver is finally getting attention from construction and project management experts. The Army Corps of Engineers will take over for the Department of VA’s Office of Construction and Facilities Management (CFM). The original estimate for the hospital project in Denver was $328 million — a decade ago. That total jumped to over $600 million before a federal appeals court ruled in December that the contractor, Kiewit-Turner, couldn’t meet the VA’s requirements for under $1 billion. Kiewit was so frustrated with dealing with VA it walked away from the project (although they eventually came back). The total to finish now stands at more than $1.7 billion, with no end in sight.

Francis Rose
All the VA seems to intend to do about it is sheepishly ask Congress to bail it out. VA has promised change in response to that debacle, and construction project blowouts in New Orleans, Las Vegas and Orlando. We’ll do better, Deputy Secretary Sloan Gibson said in Denver last week, as he apologized for the problems. And while his apology sounded sincere, the real solution to the VA’s construction fiascos — and its broader health care provision problems — may lie outside the doors of the agency. Having the Army Corps of Engineers take over management of the Denver project is no doubt an embarrassment to the VA’s CFM Office. But it’s a great opportunity for House Veterans Affairs Committee Chairman Jeff Miller (R-Fla.) and Senate Veterans Affairs Committee Chairman Johnny Isakson (R-Ga.) to ask tough questions about whether VA should even be in the construction business at all. Miller is already planning to ask questions about the Denver project next week. I wouldn’t be surprised if some of the questioning turns to the viability of the CFM Office more broadly. Isakson’s office says he’ll go to Denver to host a hearing on the hospital. One of the most pervasive problems in government has historically been the silos in which most lines of business operate in government. The “We’re special and unique” culture mandates that each agency’s information technology, human resources, financial management and in some cases construction, are dramatically different enough from everyone else’s that they must be done in-house. But experts on complex health care facilities, like experts on IT, HR and financial management, exist all over the world. The largest health care companies build their own facilities on a regular basis; three major hospitals have opened or undergone major renovations in Montgomery County, Maryland, alone in the last several years. The VA is not a construction agency. Its mission is to meet the needs of the men and women that have defended our nation. Nothing about building buildings is implicit in that. Calling on those private-sector experts to design, build and manage the care that veterans receive is one potential answer to both providing better facilities, and busting a silo that’s generated horror stories for years. But say Congress decides the function of managing the building of a veterans’ health care facility is inherently governmental and should be done inside the federal government. Why does it have to be the VA that does it? The track record seems to indicate the CFM Office isn’t up to the job, to the tune of quadruple the original price tag in Denver, and a vendor who decided (for a while, at least) it didn’t want the government’s money. Other government agencies, such as the Defense Department (example: Walter Reed National Military Medical Center) and the Department of Health and Human Services (the national jewel that is the National Institutes of Health), have a much better track record of actually getting the work done than VA. The Army Corps of Engineers builds things, and manages construction, for a living. The General Services Administration’s Public Buildings Service builds things, and manages construction, for a living. So maybe it is time to call in the experts, let them do the things for which they are experts, and get VA back to the business of super-serving veterans. The specter of shared services looms large over this controversy. If Congress can turn construction management into a shared service, certainly human resources, financial management and IT project management will attract Congress’ attention next. That could spark a series of governmentwide centers of excellence that will join U.S. Digital Services as expert teams in disciplines all across the government spectrum. The headline of the story last week on FederalNewsRadio.com reads, “VA to relinquish control of Denver hospital construction.” The CFM Office at VA may soon find it’s not just the Denver project — or its other problem projects — over which it’s losing control. Francis Rose hosts In Depth weekdays from 4-7 p.m., on Federal News Radio. RELATED STORIES: From the Old Post Office to FBI headquarters, GSA gets creative with federal property MORE COMMENTARY FROM FRANCIS ROSE: 3 reasons why new SES reform panel can succeed where others have not Why do feds and contractors have such a bad reputation outside DC? Why BRAC is good news for VA, but bad news for DoD and the Postal Service Obama SES reform plan makes problem worse, not better