Public-Private Partnership to Get the New VA Hospital Built?

Posted on Mar 04, 2016

The future of a new veterans hospital in Omaha could hinge on raising money from the Feds and private donors. Some VA officials and U.S. Representative Brad Ashford (D-NE) think a public-private partnership may be the best way to move this project forward. Under this plan Omaha would get a new $136 million medical facility, which would be built next to the current, aging VA hospital. To pay for the new 157,000 square foot facility, the VA would pony up $56 million and the other $80 million would come from private donors. A spokesman for Representative Ashford said the congressman is optimistic that local benefactors could be found.  As reported by BH Media and the Associated Press, “Ashford said he has met with prominent members of the local philanthropic community – he declined to disclose their names at this point – who have indicated a willingness to come up with around the same amount as Congress already appropriated for the new facility. ‘It doesn’t add up to $80 (million) right now but we’re going to get there,’ Ashford said. ‘My sense is the entire community is going to get behind this.’”

The news report goes on to say, “Secretary of Veterans Affairs Robert McDonald said at a House subcommittee hearing…in Washington that his department is interested in testing the financing arrangement, which faces legal and accounting questions. "I think public-private partnerships is the way of the future for us," McDonald said. "And we'd (like) ... to prove out this model and I think Omaha is a good place to do it." In his testimony, McDonald pointed out that he’s been working closely with U.S. Representative Jeff Fortenberry (R-NE) and Ashford on this project. ‘The project will require more than just the money.’ McDonald [said]. Some changes in law will be necessary. He said the department plans to propose specific language for those changes in the next week or two.”

A 2007 investigation of the current Omaha VA Hospital resulted in a grim evaluation of the facility.  The investigation report noted that the facility is beset with a host of problems especially in its antiquated electrical, heating and cooling systems. Originally, in 2011, the VA proposed to build a new $560 million Omaha facility, but that plan got quickly bogged down by spending cuts and shifting VA priorities. The BH Media report says, “[a] 2015 analysis by…the VA said funding for the full replacement project could be delayed until the late 2020s. The analysis pointed to a $9 billion backlog of approved projects and VA infrastructure needs that could reach $60 billion.”

The timeline for building this new Omaha VA medical center is uncertain at this point.

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Sean D. Cuddigan
SSA and VA Disability Attorney in Omaha, Nebraska