Management of Major Medical Leases Needs Improvement

The VA Office of the Inspector General (OIG) conducted this audit to follow up on previous reviews of its capital asset programs, which have identified areas of improvement for both major and minor construction projects, and to determine whether VA effectively managed the procurement and awarding of major medical leases under the Veterans Access, Choice, and Accountability Act of 2014 (VACAA). The OIG found that VA major medical leases authorized by VACAA are approximately 22 months behind schedule on average. The management structure of the lease acquisition process spans multiple lines of authority and requires many decisions to execute a lease contract. As a result, lease acquisitions are often slowed when project managers are confronted with conflicting opinions from different management groups. VA has taken some steps to improve the major lease acquisition process, including simplifying the solicitation documentation to better align with General Services Administration practices and changing VA’s mission-critical building standards for leases to better align with similar private sector facilities. However, several of the recommendations remain unaddressed. The OIG recommended VA ensure there are adequate funds available to routinely conduct planning activities including developing requests for lease proposals while waiting for congressional authorization; reconsider centralizing major medical lease acquisition funding activities, make certain adequate resources are available to deliver leases on schedule; ensure that the prospectus cost estimates provided to Congress are accurate; establish clear lines of authority for critical lease acquisition decisions; and adhere to appropriate security measure requirements by performing Interagency Security Committee risk evaluations prior to solicitation. Implementing these recommendations should result in faster and more cost-efficient acquisition of major medical leases.