The Veterans Administration hospital in Denver, Colorado, is way over budget. And, I mean, way, way over budget. Kiewit/Turner, the joint venture building the new hospital, has finally said enough is enough and they want approval to suspend the work and require the VA to provide a design that can be built within budget.
The project started in the 1990’s as a $200 million shared space project. In 2010, Congress approved $800 million for the entire project, but funding and design difficulties delayed the start of the project until 2012. The projected budget is now over $1 billion, at least in part due to redesign and poor management by the Veteran’s Administration.
Not surprisingly, Kiewit/Turner blames the VA and the design team. The VA points back and blames Kiewit/Turner and the design team. While the blame game is typical, the VA’s credibility is certainly questioned by the U.S. Government Accountability Office’s Report which concluded that the VA has poorly managed not only the Denver VA Hospital project, but the three other major hospital projects throughout the country. These projects are experiencing cost increases ranging from 59% to 144% and delays from 14 to 74 months.
Kiewit/Turner has filed a complaint before the federal appeals board requesting that the board authorize Kiewit/Turner to immediately suspend performance until the VA provides a design that can be built within budget. Here is a copy of Kiewit/Turner’s Complaint.
This will be an interesting situation to follow and see how the matter is resolved.