A Billion dollar Hospital?

maybe someone here can tell me if this is normal for a hospital, but I find it really distributing how much this thing has cost and how much (it appears to me) that the contractor is really hosing the VA (our tax money). I don't know any hospitals that have cost a billion dollars? A BBBBillion?

I know it probably offers more services than just bedside care but a billion for a 184 bed hospital is pretty crazy, that's basically a small hospital compared to most private run hospitals..

Not saying our vets don't deserve the care, but there has got to be a better way than to over pay for this?

http://www.denverpost.com/news/ci_27693148/lawmakers-warn-colorado-va-hospital-project-could-shut

Congressional leaders are warning that the troubled Department of Veterans Affairs hospital project in Aurora could shut down again this month.

In a letter Tuesday to VA Secretary Robert McDonald, leaders of the House and Senate veterans affairs committees noted that the agency already has borrowed $56 million from other sources to keep the Aurora hospital under construction.

"Work on this project is estimated to cease on March 29, 2015, without additional funding," said the letter, signed by the chairmen and ranking members of both committees. "To date, you have provided Congress no report on the need for a cap increase, any analysis for the cost overruns or updates on efforts to hold properly accountable those responsible."

Jeff Miller, chairman of the House Committee on Veterans' Affairs, called the Aurora hospital "the biggest construction failure in VA history" and warned that authorizing more money would be irresponsible "absent a VA plan to hold the employees responsible for this massive failure accountable."

On Wednesday, a unified Colorado delegation echoed that alarm and announced plans to visit the construction site.

"Our veterans have waited long enough for the facility they were promised and have earned. And workers at the site need certainty that construction won't be halted," said Democratic Sen. Michael Bennet.

Republican Sen. Cory Gardner called it "critically important that the senators with oversight of the VA come to Colorado to see how veterans are being harmed by the terrible mismanagement of his project."

Construction of the hospital, estimated to be more than half complete, halted in December after the U.S. Civilian Board of Contract Appeals upheld the right of contractor Kiewit-Turner to walk off the job.

A $234 million infusion got the project underway again, but that included $150 million to reimburse costs already incurred by the contractor.

At a congressional hearing last month, the VA estimated it would need to "reprogram" $200 million to $240 million in the coming weeks from other projects for the Aurora hospital.

The VA could not provide a final cost estimate but promised to provide that as soon as it gets one from the Army Corps of Engineers, which has taken over the management of the project.

The hospital, heralded as a state-of-the-art facility for Colorado's veterans, is now years behind schedule. Once budgeted for $600 million, the price tag now exceeds $1 billion.

One question looming over the Colorado project is how paying for its completion would affect VA projects in other states.

The letter from veterans affairs committee leaders called on McDonald to identify "any further reprogramming you may request, the specific facilities impacted and the amount of funding from each facility."

It also asked him to identify any delays associated with shifting money from other projects to Aurora.

Yes, but will they have PPE for the nurses?

I get the feeling that they could do a lot more good with that kind of money.

The project was always poorly structured from a financial basis. The budget was always $600 million, but the directors insisted on upgrades and "gold plating" items that quickly drove up the costs and expected the contractor to do them at no charge. Had they decided to build the original plans, they wouldn't be in this mess, but the VA really f-ed this one up. One of the biggest f-ups is that the VA kept added scope to the project and when Kiewit said that would cost more money, the VA would bring in their lawyers & PR team to threaten some sort of public leak of how the contractor "doesn't want to help our veterans", so Kiewit would agree to include these upgrades under the impression that the VA would continue working on funding sources to pay for it. Once Kiewit was $150 million over-extended, they threatened to walk off the job. The VA didn't work to get this fixed, so the contractor walked.

This is one of the few times I will side with a contractor. The VA genuinely f-ed this one up really bad.

was this bid or CM / GC? I hope someone at the VA gets their termination papers soon.. Sad they cant even give a cost estimate to complete?

I am sure Davis Bacon Wages and Rooftop Solar helped get this to Gig level.

RG, I don't know the contract type.

SW, Everything is Davis Bacon around here. Still better than Union.

I did a bunch of reading about this last night and it does appear the VA folks totally failed. Especially when you have a "couple hundred million in change orders you know the contractor is going to pad those. Especially when it looks like the "owner" has no clue what they are doing...end result is still the tax payer getting hosed...

I believe the DeBakey VA Medical Center in Houston cost almost a billion. It may just be an "Urban Legend", but I have been told that it was built with private money/project management and turned over to the VA when it was finished.

Dexman PE PMP said:

The project was always poorly structured from a financial basis. The budget was always $600 million, but the directors insisted on upgrades and "gold plating" items that quickly drove up the costs and expected the contractor to do them at no charge. Had they decided to build the original plans, they wouldn't be in this mess, but the VA really f-ed this one up. One of the biggest f-ups is that the VA kept added scope to the project and when Kiewit said that would cost more money, the VA would bring in their lawyers & PR team to threaten some sort of public leak of how the contractor "doesn't want to help our veterans", so Kiewit would agree to include these upgrades under the impression that the VA would continue working on funding sources to pay for it. Once Kiewit was $150 million over-extended, they threatened to walk off the job. The VA didn't work to get this fixed, so the contractor walked.

This is one of the few times I will side with a contractor. The VA genuinely f-ed this one up really bad.

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Where did you get all that from? We haven't much about it here.

As someone who has worked for the USACE and now the VA, project costs going up isn't anything new. The typical contractor MO in Gov't work is to bid low on a project and then try to make it up on the back end with change orders. I'm actually surprised the VA was handling this project on their own in the first place. I didn't think they were supposed to for anything over $10m. While I like working here, it is very obvious:

• the USACE builds projects
  
• the VA is a health care organization that just happens to do enough construction that we have our own Engineering and Contracting Depts.
  

My wife works on the campus (separate hospital, but some shared facilities), and one of my neighbors is one of the management team for the contractor. I haven't talked with him since the shut down to see how things are going now.

How many beds?

$1.73 billion

http://www.denverpost.com/breakingnews/ci_27730588/cost-aurora-veterans-hospital-leaps-1-73-billion

This is what happens when your wishlist gets bigger than your wallet.

The Civilian Board of Contract Appeals decision is interesting reading: http://www.denverpost.com/news/ci_27103393/contractor-kiewit-walking-away-from-va-hospital-aurora

Simply put, the VA didn't implement CM At Risk (aka Early Contractor Involvement) properly, and they didn't force the Designer (a Joint Venture Team) to create a design that could be constructed for the amount required by the Builder.

Kiewit and Turner are both known for excessive change orders, especially given this opportunity where it looks like the owner had no clue what they were doing..

Turner did a 5 story jail for us back in GA- I got brought in to help negotiate the final change orders and you could really tell they had way over inflated their change orders and really had very little backup or documentation for anything they were requesting, we cut most all of them by at least half with no claims.

Road Guy said:

Kiewit and Turner are both known for excessive change orders, especially given this opportunity where it looks like the owner had no clue what they were doing..

Turner did a 5 story jail for us back in GA- I got brought in to help negotiate the final change orders and you could really tell they had way over inflated their change orders and really had very little backup or documentation for anything they were requesting, we cut most all of them by at least half with no claims.

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I have seen projects with them that ran smooth and great, and seen complete disasters where the building was finished but furniture and final site work was sacrificed. (Though I blamed the A&E firm because they should have been more on top of things).

Road Guy said:

Kiewit and Turner are both known for excessive change orders, especially given this opportunity where it looks like the owner had no clue what they were doing..

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With CM-At-Risk, they need to set a Guaranteed Maximum Price (which they're calling a Firm Target Price in this case) and then eventually definitize the cost-plus. According to the decision, the Estimated Construction Cost at Award (ECCA) was never fairly estimated to be under the available budget after the 65% design. And ultimately, it was determined to be breach of contract for the VA to insist they continue work. Change orders would have been the least of their problems!

engineergurl said:

I have seen projects with them that ran smooth and great, and seen complete disasters where the building was finished but furniture and final site work was sacrificed. (Though I blamed the A&E firm because they should have been more on top of things).

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That's the problem with large firms... you never know what kind of project team you're going to get.

We had that problem on one of my USACE projects. Forget the name of the firm, but the plans were done by several of their offices and none of them coordinated with each other. There'd be stuff shown on the arch. sheet but no power going to them on the elec. sheet.