,i #aaith ,,congress #ast ,session ,h4 ,r4 #feii ,,in ,,the ,,house ,,of ,,representatives ,december #aj1 #bjbe,mr4 ,smith of ,missouri introduced the following bill2 which was referred to the ,committee on ,veterans' ,affairs ,a ,,bill ,to amend title #ch1 ,united ,states ,code1 to establish an independent authority of the ,secretary of ,veterans ,affairs to enter into leases for major medical facilities1 and for other purposes4 #a4 ,short title ,this ,act may be cited as the ,leasing and ,infrastructure ,act of #bjbe4 #b4 ,independent authority of the ,secretary of ,veterans ,affairs to enter into leases for major medical facilities2 establishment of ,veterans ,leasing ,fund 7a7 ,independent authority ,section #hajc of title #ch1 ,united ,states ,code1 is amended by adding at the end the following new subsections3 7i7 ,independent leasing authority 7#a7 ,notwithstanding section #ccjg of title #dj1 the ,secretary may enter into a lease for any major medical facility 7as defined in section #hajd of this title7 without delegation from the ,administrator of ,general ,services1 if the prospectus for such a lease has been-- 7,a7 approved by the ,committees on ,veterans' ,affairs of the ,house of ,representatives and the ,senate2 and 7,b7 transmitted concurrently to-- 7i7 the ,committee on ,transportation and ,infrastructure of the ,house of ,representatives2 and 7ii7 the ,committee on ,environment and ,public ,works of the ,senate4 7#b7 7,a7 ,the firm term of a lease under this subsection may not exceed #bj years4 ,no lease under this subsection may be extended beyond the firm term unless-- 7i7 such extension is authorized in the prospectus2 or 7ii7 ,congress approves such extension4 7,b7 ,for purposes of this paragraph1 the term firm term means the initial1 non-cancellable lease period approved in the prospectus4 7#c7 ,a lease under this subsection-- 7,a7 may be executed only to the extent and in the amount provided in advance in the ,veterans ,leasing ,fund established by subsection 7j72 and 7,b7 shall be scored and funded in accordance with ,office of ,management and ,budget ,circular ,a-#aa4 7#d7 7,a7 ,in exercising the authority under this subsection1 the ,secretary shall1 for each purpose-built medical facility constructed pursuant to a lease awarded under this subsection in each locality1 submit to ,congress accurate1 market-based cost estimates4 ,such estimates shall-- 7i7 account for construction costs1 material costs1 and land acquisition costs2 and 7ii7 be informed by qualified sources1 including licensed appraisers1 valuation experts1 professional estimating firms1 or commercial real estate firms4 7,b7 ,the ,secretary may also request technical assistance from the ,administrator of ,general ,services with respect to market surveys1 cost estimation1 or lease scoring4 7,c7 ,if1 at any point in the procurement process 7including during cost estimation1 the expression of interest phase1 or upon receipt of pricing from offerors7 projected costs exceed approved estimates by more than ten percent1 or exceed any congressional budget authority1 the ,secretary shall1 not later than #cj days after the date on which the ,secretary is notified of such projected costs1 submit to the ,committees on ,veterans' ,affairs of the ,house of ,representatives and the ,senate1 the ,committee on ,transportation and ,infrastructure of the ,house of ,representatives1 and the ,committee on ,environment and ,public ,works a notification that such projected costs exceed approved estimates or congressional budget authority1 as the case may be4 7j7 ,veterans leasing fund 7#a7 ,there is established in the ,treasury a revolving fund to be known as the ,veterans ,leasing ,fund 7in this subsection referred to as the ,fund74 7#b7 ,there shall be deposited in the ,fund-- 7,a7 amounts appropriated for the purpose of carrying out the independent leasing authority under subsection 7i72 and 7,b7 amounts transferred1 on a reimbursable or nonreimbursable basis1 from the ,medical ,facilities account of the ,department 7or any successor account7 for the payment of annual rent1 taxes1 or operating costs for leases executed under subsection 7i74 7#c7 ,amounts in the ,fund are hereby made available as contract authority to enter into obligations to carry out subsection 7i71 including obligations in advance of receipts4 7#d7 ,the ,secretary may obligate amounts in the ,fund for rental payments1 tenant improvements1 real-estate taxes1 operating expenses1 and pre-award due diligence costs1 including design1 environmental1 and professional service fees associated with leases entered into pursuant to subsection 7i74 7#e7 ,the ,secretary shall include1 in the annual budget justification materials submitted to ,congress in support of the ,department-- 7,a7 the projected unobligated balance of the ,fund2 7,b7 new obligations2 and 7,c7 collections for the year covered by such budget justification materials and the four fiscal years succeeding such year4 7k7 ,one-,year target for lease awards2 annual report 7#a7 ,the ,secretary shall1 to the maximum extent practicable1 award a lease for a major medical facility not later than not later than the end of the one year period beginning on the date on which the ,secretary issues a solicitation for the lease agreement4 7#b7 ,the ,secretary shall revise internal guidance1 milestone reviews1 and approval workflows to-- 7,a7 support the requirement under paragraph 7#a72 and 7,b7 eliminate duplicative or sequential reviews that delay procurement4 7#c7 ,a contracting officer may not issue a solicitation described in paragraph 7#a7 unless1 before the date of issuance1 the officer has placed in the official contract file a written certification that-- 7,a7 sufficient funds are obligated to cover all due diligence and pre-award professional services reasonably anticipated for the project1 including environmental1 geotechnical1 title1 survey1 appraisal1 brokerage1 and architectural-engineering services2 and 7,b7 each such service is available for task-order issuance within #cj days under an existing indefinite-delivery1 indefinite-quantity contract or other competitively-awarded vehicle4 7#d7 ,obligations under paragraph 7#c7 may be made from the ,veterans ,leasing ,fund established in subsection 7j7 or from other appropriations for medical facilities that are available for the applicable fiscal year4 7#e7 7,a7 ,as part of the public notice during the expression of interest phase of the acquisition process1 the ,secretary shall require each prospective developer to provide price estimates1 including the cost of land1 to enable the ,department to evaluate whether projected costs are at or below the unserviced shell rent authorized in the approved prospectus4 7,b7 7i7 ,if such estimates exceed such amount authorized1 the ,secretary shall1 not later than #ad days after the date on which the ,secretary completes such evaluation1 submit to ,congress a notification that such estimates exceed such authorized amount4 7ii7 ,not later than #de days after the date on which the ,secretary submits the notification under clause 7i71 the ,department shall finalize a plan to address the discrepancy between such estimates and such authorized amount1 which may include-- 7,i7 reducing the scope of the project2 7,,ii7 requesting additional budget authority2 or 7,,iii7 postponing1 or canceling the project1 as appropriate4 7,c7 ,to the maximum extent practicable1 the ,secretary shall1 not later than #fj days after the date on which the ,secretary submits the notification under subparagraph 7,b71 notify prospective offerors of the potential effect to procurement timelines1 including the estimated release date of the request for lease proposals4 7#f7 ,the ,secretary shall include1 in any request for a lease proposal made pursuant to the leasing authority under subsection 7i7-- 7,a7 a summary of the procurement milestones applicable to such request2 and 7,b7 a statement that a reimbursement under paragraph 7#g7 would become effective on the date that is one year after the date on which the ,secretary issued such request4 7#g7 7,a7 ,if the ,secretary does not award a lease pursuant to a request for a lease proposal before the date that is one year after the date on which the ,secretary issued such request1 the ,secretary shall be required to reimburse each prospective lessor in the competitive range for costs directly associated with the delay in awarding the lease4 7,b7 ,any reimbursement under subparagraph 7,a7 shall be calculated based on one percent annually 7paid in equal monthly installments of one-twelfth of one percent7 of the average land acquisition cost1 as proposed by all offerors remaining in the competitive range under the request4 7,c7 ,payment of such reimbursements under this paragraph shall cease-- 7i7 immediately upon the award of the lease2 or 7ii7 the date on which the project is cancelled1 if applicable4 7,d7 ,the ,secretary shall issue guidance establishing documentation requirements and procedures for administering reimbursements under this paragraph4 7#h7 ,not later than ,march #a of each year1 the ,secretary shall submit to the ,committees on ,veterans' ,affairs of the ,house of ,representatives and the ,senate a report that includes-- 7,a7 a list of each major medical facility lease for which a request was issued during the preceding calendar year2 7,b7 a statement of whether the lease was awarded within the one year period described in paragraph 7#a72 and 7,c7 for any lease not awarded within such period1 an explanation of the reasons the lease was not awarded during such period4 7#i7 ,not later than #ij days after the date of the enactment of this subsection1 the ,secretary shall issue internal guidance that establishes the policies and thresholds the ,secretary determines necessary to administer the requirements of this subsection4 7l7 ,revisions ,to design guides 7#a7 ,not later than #ahj days after the date of enactment of this subsection1 and not less frequently than once every five years thereafter1 the ,secretary shall revise the design guides of the ,department applicable to outpatient clinics and other leased medical facilities4 7#b7 ,in carrying out paragraph 7#a71 the ,secretary shall consult with subject matter experts1 including health care professionals and representatives of the private health care industry4 7#c7 ,any revision to design guides conducted pursuant to this section shall not be over-engineered or unnecessarily prescriptive specifications unless required for clinical safety1 functional performance1 or applicable building codes4 7m7 ,mitigation of risk premiums 7#a7 ,the ,secretary may include in a lease agreement under this chapter terms that mitigate risk premiums to the ,department1 including-- 7,a7 post-occupancy self-insurance arrangements by the ,department2 7,b7 reimbursement to a prospective lessor for reasonable holding costs incurred as a result of delays attributable to the ,department in excess of established procurement milestones2 7,c7 authorization to structure major medical facility leases as triple-net leases 7,,nnn7 or modified-gross leases1 as appropriate1 to align with prevailing commercial market practices2 and 7,d7 definitions of the terms shell work and tenant improvements to ensure cost allocation is consistent with prevailing commercial market standards4 7#b7 ,not later than #ahj days after the date of enactment of this subsection1 the ,secretary shall issue guidance with respect to the use of such terms in lease agreements under this chapter4 ,in such guidance1 the ,secretary shall ensure-- 7,a7 heating1 ventilation1 and air conditioning system capacity is included in the definition of shell work2 and 7,b7 heating1 ventilation1 and air conditioning distribution and controls required to meet tenant-specific needs are included in the definition of tenant improvements1 unless otherwise negotiated4 7#c7 ,for purposes of this subsection1 the term triple-net lease means a lease under which the lessee is responsible for payment of real estate taxes1 insurance1 utilities1 janitorial services1 and routine operating costs4 7n7 ,consolidation of documentation ,the ,secretary shall consolidate internal documentation required to support lease decisions under this chapter into a single decision memorandum1 to the maximum extent practicable4 ,such memorandum shall include project justification1 site selection rationale1 estimated costs1 design summary1 and other information necessary for internal approval and submission to ,congress4 4 7b7 ,conforming amendment ,section #hajd7;a77#c77;,b77i7 of title #ch1 ,united ,states ,code1 is amended by striking through the ,general ,services ,administration under section #ccjg7;a7 of title #dj4 7c7 ,authorization of appropriations 7#a7 ,in general ,there are authorized to be appropriated to the ,veterans ,leasing ,fund established under section #hajc of title #ch1 ,united ,states ,code1 7as amended by this ,act71 such amounts as may be specifically authorized for lease obligations under subsection 7i7 of such section 7as added by this ,act74 7#b7 ,deposit of future appropriations ,any amounts appropriated for lease obligations for a fiscal year shall be deposited in the ,veterans ,leasing ,fund4 #c4 ,cost estimation requirements for major medical facility leases ,section #hajd7;b77#b7 of such title is amended-- 7#a7 by striking ,whenever and inserting 7,a7 ,whenever2 7#b7 by redesignating subparagraphs 7,a7 through 7,e7 as clauses 7i7 through 7v71 respectively2 7#c7 in subparagraph 7,a71 as designated by paragraph 7#a7-- 7,a7 in clause 7v71 as so redesignated-- 7i7 by redesignating clauses 7i7 through 7iii7 as subclauses 7,i7 through 7,,iii71 respectively2 and 7ii7 by striking the period at the end and inserting 2 and2 and 7,b7 by adding at the end the following new clause3 7vi7 ,a market-based cost estimate for the facility to be leased that includes an evaluation of-- 7,i7 local land values2 7,,ii7 applicable construction costs2 and 7,,iii7 other cost factors the ,secretary determines relevant to build-to-suit facilities4 2 and 7#d7 by adding at the end the following new subparagraph3 7,b7 7i7 ,the ,secretary shall adopt and apply a standardized methodology for estimating the full life-cycle cost of major medical facility leases and prospectus-level leases4 7ii7 ,such methodology shall include1 at a minimum-- 7,i7 base rent projections over the full lease term2 7,,ii7 tenant improvement and buildout costs based on current medical facility standards2 7,,iii7 estimated operating expenses1 including utilities1 maintenance1 and security2 7,,iv7 annual escalation factors tied to construction cost indices1 labor rates1 and market trends2 7,v7 cost assumptions for option periods or potential renewal terms2 and 7,,vi7 geographic adjustments using current regional market data to reflect location-specific construction and leasing conditions4 7iii7 ,to reflect inflation and market escalation1 the ,secretary shall annually adjust each cost estimate for a lease submitted to ,congress for authorization or prospectus approval during the period beginning on the date on which the ,secretary submits the first cost estimate for the lease and ending on the projected award date for the lease4 ,in adjusting a cost estimate pursuant to this subparagraph1 the ,secretary shall use such medical construction or real estate indices as the ,secretary determines appropriate4 7iv7 ,if the ,secretary does not award a lease during the one year period beginning on the date on which the ,secretary completes a cost estimate for the lease pursuant to this paragraph1 the ,secretary shall update and revalidate such cost estimate prior to obligating any funds for the lease or submitting such cost estimate to ,congress4 4 #d4 ,development of streamlined procurement model2 report ,not later than #ahj days after the date of enactment of this ,act1 the ,secretary of ,veterans ,affairs1 in consultation with the ,comptroller ,general of the ,united ,states1 the ,director of the ,office of ,management and ,budget1 and private sector stakeholders1 shall develop a revised process for the procurement of major medical facility leases under chapter #ha of title #ch1 ,united ,states ,code1 and submit to the ,committees on ,veterans' ,affairs of the ,house of ,representatives and the ,senate a report that includes a description of such revised process4