VA Owes $226 Million to Treasury Department, Inspector General Finds

Thanks for sharing my friend LTC Ivan Raiklin, Esq. the "news" that the Treasury wants to recover from the VA the penalties that courts have levied against individual VA hospitals in Denver, Colorado; Orlando, Florida and other VA projects in Maryland, Nevada, California and Pennsylvania.
Hopefully this dispute between the Treasury and the VA will not adversely impact care to veterans.

"The Department of Veterans Affairs owes $226 million to the Treasury Department and has no immediate plans to repay it, according to an internal watchdog report released Tuesday.
The VA office of inspector general found the agency has not repaid funds taken from the Treasury's Judgment Fund during the past six years to pay settlements from contract disputes on 10 major construction projects. The lack of reimbursement goes against federal regulations and VA policy, inspectors said.

"By not reimbursing the Judgment Fund timely, VA has continued to maintain significant liabilities," inspectors wrote. "VA will require significant future funding to satisfy the outstanding claims."

The Treasury paid to settle 23 claims arising from contract disputes on major VA projects in Maryland, Florida, Colorado, Nevada, California and Pennsylvania. Federal laws require agencies to reimburse the Treasury within 45 days or create a repayment plan in that time. Inspectors found the VA had been delinquent for 221 days on average and the agency had no documented plans to repay the money.

Three claims were related to the VA hospital near Denver, which is under construction and experiencing massive cost overruns. Reimbursement for one of those claims is $4.5 million and 411 days past due.

Nine claims came from construction of the new VA hospital in Orlando, Florida. Five of those claims are 340 days delinquent.

As older claims go unpaid, new ones are piling on. One claim, for $1.4 million for the Orlando project, was five days delinquent when inspectors began their review.

The inspector general's office conducted its review from January to September, following a request from Congress to look into the issue.

As of Jan. 31, 2017, the VA had reimbursed the Treasury fund for only $21.4 million of the $247.7 million that it owed, inspectors found, bringing its outstanding balance to $226.3 million. The Treasury does not assess interest on the VA."


FYI COL Mikel J. Burroughs LTC Stephen C. Capt Seid Waddell Capt Tom Brown CW5 (Join to see) SGM David W. Carr LOM, DMSM MP SGT MSG Andrew White SFC Joe S. Davis Jr., MSM, DSL SFC William Farrell SSgt Robert Marx TSgt Joe C. SGT John " Mac " McConnell SP5 Mark Kuzinski SPC (Join to see) SrA Christopher Wright Cpl Joshua Caldwell LTC Bill Koski LTC Wayne Brandon

I'm sure the check is in the mail...

From what I understand a federal agency may request that payment of an award be made on its behalf from the Judgment Fund only in those instances where funds are not "legally available" to pay the award from the agency's own appropriations so I'm assuming there is some legal reasoning for this liability. As well federal agencies are not required to reimburse the Judgment Fund except when cases are filed under the Contract Disputes Act (CDA) or the No FEAR Act (Notification and Federal Employee Anti-discrimination and Retaliation Act). Interesting that the two conditions require reimbursement to the fund. As well I'd like to know more about the "legally available" condition.

This is not the first time I've seen articles related to the VA and contract disputes.
Seems the VA needs to understand its obligations in regards to the law in avoiding contract disputes.
This is something that needs to get fixed as I feel somewhere somehow there is an interest rate attached to the liability.

Attached is the VA's Inspector General Report.
https://www.va.gov/oig/pubs/VAOIG-17-00833-05.pdf


https://www.pbs.org/newshour/nation/justices-rule-against-va-in-disabled-vets-contract-dispute