A week after halting work on a massive new U.S. Dept. of Veterans Affairs (VA) hospital project in Aurora, Colo., the Kiewit-Turner joint venture struck a tentative deal to finish the project on a cost-reimbursable basis and collect $157 million that it is owed.
The agreement followed a meeting between VA officials and Kiewit-Turner where the terms were negotiated. A statement released by Kiewit-Turner and the VA said the VA must secure additional project funds.
The joint venture had stopped work after a federal appeals board ruling the day prior that said VA had breached its contract.
Kiewit-Turner had filed a request in August to leave the project after claiming the agency owed the contractor up to $100 million for unpaid work and materials. The U.S. Civilian Board of Contract Appeals sided with the joint venture Dec. 9th, saying the VA had failed to agree on a design and could not reasonably hold the joint venture to a $604-million cost-to-complete.
Under the terms of the agreement, the VA will pay Kiewit-Turner for past costs, take advice from the U.S. Army Corps of Engineers about how to proceed and reimburse Kiewit-Turner for cost plus profit based on Federal Acquisition Regulation guidelines.
Kiewit-Turner had originally insisted it would only return to work if the Corp was put in charge of managing the big hospital center project.
A team that includes VA, Corps and Kiewit staff still must work out the details of what is being called an “interim agreement” subject to final approval.
“This isn’t about building a medical center, but about building a facility where VA can provide high-quality health care to the more than 390,000 Colorado veterans who have served our nation,” said VA Deputy Secretary Sloan Gibson.
