Article: http://extras.denverpost.com/aurora-va-hospital/
Here is a case study that every project manager should read. The level of incompetent project management is infuriating to read about as a taxpayer, veteran and project manager! Portions of the article are repeated below. Major failures:
- Communications
- Gold plating the project
- Scope creep
- Informal procurement processes and use of an *entirely new* procurement process
- Inadequate risk management
- Failure to react to “Lessons Learned”
As usual, the culpable parties have mostly all retired collecting nice government pensions after leaving this fiasco.
To quote Marvin the Martian: “This makes me very, very angry.” My long standing recommendation? CLOSE THE VA. They don’t seem to be able to do much right and the bureaucracy there is dug in like ticks. Accountability is nowhere to be found. ____________________________________________________________________________________________
The biggest construction failure in VA history began with a handwritten note signed two days before Veterans Day 2011.
That brief note became the pact to start work on a state-of-the-art medical campus spread across 31 acres.
Its signing also marked the moment when the VA hospital in Aurora began to devolve from a mismanaged project to a national calamity.
The VA could not hold up its end of the deal and control its designers, who initially operated under a contract that left the construction price blank. It later battled KT in court for 17 months and lost. The agency stonewalled elected officials as costs, delays and questions mounted, and its own investigative staff did nothing.
VA officials pressed ahead with the project despite repeated warnings — internal and external — about the project’s high risk of busting its budget.
Even now, there is no agreement on fully funding the new medical campus, which the VA admitted in March could cost a stunning $1.73 billion. The design includes features such as a curved lobby spanning two city blocks, 43 elevators and a vivarium for animal experiments. The cost is five times an initial $328 million estimate and nearly three times the $604 million construction target.
One reason the cost of the Aurora hospital has risen over the years is the VA decision to use a contracting method — known as integrated design and construct, or IDC — that is largely unfamiliar to the agency.
No major VA project had ever been completed using an IDC contract. None of its project leaders in Colorado were experienced with it.
From the project’s earliest days, there were issues with the design.
In January 2006,a high-powered coalition of architects and engineers was contracted to develop a blueprint for the facility. Later, work would be suspended twice as the VA changed size and budget estimates.
Tim Pogany, the VA’s project manager in Aurora, testified that he once considered firing the design team because they listened to the advice of a former VA secretary who told them, “The pie in the sky is what we’re shooting for here, so whatever you want from the Denver area, I will get you, whatever additional funds you need, so design me what the Medical Center wants.”
Pogany said the secretary was Jim Nicholson, a former Denver resident and Republican National Committee chairman who led the agency from 2005 to 2007.
A few weeks after agreeing to the KT deal, the VA wrote the design team and made clear it expected a plan that would fit within the budget. 9
Fromm responded in January 2012 with his own letter that accused the VA of ignoring them and withholding crucial information. 10
“Proceeding with construction on such a major project without a common understanding of and access to the project’s documents of record would be reckless on our part as it would be foolish on the government’s part,” he wrote.
Another factor was time. The VA didn’t have another firm lined up to peer review the design work, a critical oversight. This failure — coupled with already-poor communication — delayed the delivery of plans until August 2012, months behind schedule.
When they did arrive, KT attorneys noted the plans “had to be revised at least once, which had a significant impact on the subcontractor community who lost confidence in the project and its design.”
The lack of oversight was made worse by VA obstinacy. In dealing with Congress, agency officials often closed ranks and shielded internal decisions.
At a House hearing in May 2013 to examine the GAO report’s findings as well as the pace of VA construction, frustrated members of Congress got few answers.
“One of the most distressing items in the (GAO) report is that VA failed to learn from its mistakes as it went from project to project,” said Coffman, whose congressional district included the hospital starting in early 2013.
Lawmakers such as Bennet and Perlmutter said they told the VA that fighting KT was a losing strategy and that the agency should settle.
The VA never did. The result was a crushing decision against the agency in December by the U.S. Civilian Board of Contract Appeals. 12
The court found the behavior of VA officials did not comport with “standards of good faith and fair dealings required by law.” The VA never gave KT a workable design — in part because it “did not control its designer” — and, when presented with more cost-effective options, VA officials “paid no heed.”
Phillipa Anderson, who led the VA legal team that developed the Aurora contract and fought KT in court, retired last spring after being questioned about her role.
Every other senior executive involved, VA officials say, is gone from the project. Many have retired, and lower-level staffers are working elsewhere in the agency.
At a recent congressional hearing, VA Secretary Robert McDonald said nine of the 17 top leaders at the VA are new since he took the helm in July 2014.
