When it comes to government projects, it seems that management problems and vast cost overruns are par for the course.
Whether it’s the construction of the Department of Homeland Security’s sprawling new $4.5 billion headquarters, or a decade-long (and still ongoing) project to consolidate the electronic health records of the Department of Defense and Veterans Affairs, financial overruns are crippling the federal government.
The Fiscal Times highlights 5 of the most expensive project failures – or potential failures – that are right now costing taxpayers billions of dollars. Some of these figures are low-balled estimates.
Energy Dept: Nuclear Waste Management: $7 Billion and Counting...
Two vital projects within the Department of Energy’s multi-billion dollar program to dispose of surplus weapons-grade plutonium are already $3 billion over budget and are nowhere near completion.
The National Nuclear Security Administration’s plutonium disposition program has spent $7 billion on two incomplete programs: the Mixed Oxide Fuel Fabrication Facility, which produces fuel for nuclear reactors, and the Waste Solidification Building, which disposes of liquid waste from the first facility, according to the Government Accountability Office.
The South Carolina-based projects were originally estimated to cost some $4 billion. Now, due to NNSA mismanagement, auditors say the projects won’t be finished for several years while costs will skyrocket. The NNSA is frequently featured on the GAO’s annual “high risk” report, which highlights government programs that routinely experience waste, fraud, abuse and mismanagement. Read more here…
Homeland Security: New HQ - $4.5 Billion…
Homeland Security has a ginormous problem: Its massive new headquarters is 11 years behind schedule and more than $1.5 billion over budget – and some lawmakers and federal auditors even question if it will ever be completed.
Located on the grounds of St. Elizabeth’s – a former psychiatric institution in Southeast D.C. – the project is the D.C. area’s largest planned construction project since the Pentagon. It was to be finished this year but is still almost entirely undeveloped, though it’s cost $4.5 billion so far. The new completion date is now 2026, but even that might be optimistic, according to The Washington Post.
The project begin after the Sept. 11, 2001 attacks, when President George W. Bush called for a new centralized headquarters so the agency could better coordinate efforts to fight terrorism, patrol borders and respond to national disasters. DHS agencies are still, to this day, spread out all over the city – and paying expensive leases. Auditors and agency officials say that both the shortfall in funding and partisan standoffs in Washington have contributed to delays and cost overruns. Read more here…
Defense Dept/Veterans Affairs: Electronic Health System - Well Over $1.1 Billion…
The Pentagon and the VA ditched a $1.1 billion project in February that the two largest departments had been working on for five years, according to federal auditors.
The idea: Build an integrated electronic health record system so the two agencies could share data. But with poor communication between the agencies and poor oversight of government contractors, the program was on track to cost a total of $28 billion – seven times the original estimate.
DOD and VA department officials said canceling the project was ultimately the most cost-effective decision. Now they’re each moving forward with their own system upgrades. DOD officials are planning to purchase a new commercial system that will cost at least another $4 billion and won’t be ready until at least 2017, while the VA said it will upgrade its system and has not released an estimate. An integration is still planned eventually. Read more here…
D.C. Parking Garage: $120 Million...
Though $120 million seems like a drop in the ocean when it comes to federal spending, the price tag for this incomplete, 16-year-old project is another example of federal mismanagement.
The Paul S. Sarbanes Silver Spring Transit Center in Silver Spring, M.D., was originally supposed to cost $40 million, but 16 years later, the cost has ballooned to $120 million –with the government picking up half the tab. It’s still nowhere near completion. Auditors attribute shoddy workmanship, lax oversight and serious mismanagement.
Though the costs keep adding up with no tangible results, county officials are still forging ahead. There is apparently no clear idea of when the project will be complete. Read more here…
IRS’ Latest Data Modernization: Well Over $37 Million…
The latest attempt by the IRS to shift the data of 140 million taxpayers from an old master file on 1960s-era software to a modernized database is now estimated to cost $83 million – or 74 percent more than the agency anticipated, according to the Treasury Inspector General for Tax Administration (TIGTA).
The project, known as the Customer Account Data Engine 2 (CADE 2), missed its deadline and still lacks a functional security system, according to the latest TIGTA report. The project is supposed to replace the current Individual Master File (IMF) with a relational database. It will eventually allow the IRS to update taxpayer accounts and process tax returns quickly and easily every day, compared to the current, outdated system that can only do so weekly.
CADE 2 is the second attempt. Its predecessor, CADE 1, fell two years behind schedule and went $37 million over budget due to inadequate definitions of system requirements and inaccurate cost and timeframe estimates, according to the GAO. It was eventually scrapped in 2008. Read more here…
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