VA: Cut spending or delay projects to finish Denver hospital

AP News
Posted: Jun 05, 2015 8:01 PM

DENVER (AP) — The Veterans Affairs Department on Friday offered Congress two new ways to finish a budget-busting medical center under construction in suburban Denver: Broad spending cuts of nearly 1 percent, or shifting funds from dozens of construction and maintenance projects planned in other states.

Mandatory benefits programs would not be cut. Paring 0.89 percent from other spending in the budget year that starts in October would produce the $625 million needed, the department said.

Veterans medical care nationwide would take the biggest hit, nearly $535 million, according to the agency's estimate.

The department didn't say how long the other projects would be delayed if Congress accepts the other option, shifting money from other construction and maintenance projects to the Denver hospital. The list includes as many as 44 construction projects in 24 states, plus up to 65 maintenance projects in about 16 states.

The VA had previously proposed finishing the Denver facility with money from the Veterans Choice program, designed to improve veterans' access to care. Congress rejected the idea.

Key lawmakers said they were reviewing the new proposals, and some had no immediate comment.

Steven Rylant, president of the United Veterans Committee of Colorado, said his group was encouraged by the new options. Rylant noted the new Denver-area hospital will serve veterans in Kansas, Montana, New Mexico, Utah and Wyoming as well as Colorado.

The hospital is expected to cost up to $1.73 billion, nearly three times the estimate given last year. The VA has blamed problems in the design process, and at least two internal investigations are underway.

Angry members of Congress want the VA to fire those responsible for the overruns and are demanding significant changes in the way the agency handles major construction projects.

The half-finished medical center in the eastern suburb of Aurora will replace an old, cramped facility in Denver.

The VA first asked for another $830 million to finish but then said it could cut that to $625 million. About $55 million would be saved by indefinitely delaying a nursing home and post-traumatic stress disorder clinic planned on the campus. The VA has said it can divert another $150 million to the project by shuffling money in its current budget.

Unless Congress and the VA reach a deal, construction could stop in mid-June, when the current spending cap is reached. Contractor Kiewit-Turner has said a shutdown could add up to $200 million to the cost because of the expenses of winding down work, securing the site and then gearing back up again.

The chairmen of the House and Senate Veterans Affairs committees had no immediate comment on the VA proposal, nor did Colorado Republican Rep. Mike Coffman, whose district includes the new medical center.

Colorado's two senators, Democrat Michael Bennet and Republican Cory Gardner, said they were reviewing the plan. Rep. Ed Perlmutter, D-Colorado, said it appears to be a serious proposal. He urged VA and leaders of the GOP, who control both houses of Congress, to negotiate a deal. ___

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This story has been corrected to show the proposed 0.89 percent spending cuts would affect much of the department, but not all of it.