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HRD-82-28 1 (1981-12-30)

handle is hein.gao/gaobabcug0001 and id is 1 raw text is: UNITED STATES GENERAL ACCOUNTING OFFICE WASHINGTON, D.C. 20548 17Y HUMAN RESOURCES DIVISION DECEMBER 30, 1981 B-204206 The Honorable Ronald M. Mottl Chairman, Subcommittee on Hospitals and Health Care Committee on Veterans' Affairs 117249 House of Representatives Dear Mr. Chairman: Subject: Opportunity to Reduce the Cost of Building VA Medical Facilities (HRD-82-28) At your request, we have reviewed the Veterans Administra- tion's (VA's) medical facility construction program. As agreed with your staff, we concentrated on (1) the reasons for cost growth in the program, (2) the reasons for large numbers of changes to design and construction contracts, and (3) the costs these changes added to projects. The results of our work are in the enclosure. VA's construction program has changed significantly since the projects we reviewed were being designed and constructed. Congressional concerns about cost growth in VA's major construc- tion program prompted (1) the Congress to enact legislation to control the growth of VA projects beyond their original cost es- timates and (2) VA to create an Advanced Planning Fund to enable it to provide the Congress better cost estimates. Although it is too soon to fully evaluate the effectiveness of these actions, they should enable the VA to submit better cost estimates to the Congress and will provide an upper limit cost control on approved projects. The time it takes to complete medical facility construction projects could be reduced by up to 15 months by extending the Advanced Planning Fund to allow VA to contract for final designs while the Congress reviews the projects. This could reduce over- all project costs by minimizing the effects of inflation; however, there would be the added risk that, if the Congress did not ap- prove or fund a project so designed, the final design costs would be wasted. Whether the change should be made rests largely on the confidence the Subcommittee has in VA's ability to identify and prioritize its construction requirements. (401903) ,icV

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