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113th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 1st Session                                                    113-284

======================================================================



 
      DEPARTMENT OF VETERANS AFFAIRS MAJOR MEDICAL FACILITY LEASE 
                       AUTHORIZATION ACT OF 2013

                                _______
                                

December 9, 2013.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

    Mr. Miller of Florida, from the Committee on Veterans' Affairs, 
                        submitted the following

                              R E P O R T

                        [To accompany H.R. 3521]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Veterans' Affairs, to whom was referred 
the bill (H.R. 3521) to authorize Department of Veterans 
Affairs major medical facility leases, and for other purposes, 
having considered the same, report favorably thereon without 
amendment and recommend that the bill do pass.

                                CONTENTS

                                                                   Page
Purpose and Summary..............................................     2
Background and Need for Legislation..............................     3
Hearings.........................................................    10
Committee Consideration..........................................    10
Committee Votes..................................................    10
Committee Oversight Findings.....................................    10
Statement of General Performance Goals and Objectives............    10
New Budget Authority, Entitlement Authority, and Tax Expenditures    10
Earmarks and Tax and Tariff Benefits.............................    11
Committee Cost Estimate..........................................    11
Congressional Budget Office Estimate.............................    11
Federal Mandates Statement.......................................    15
Advisory Committee Statement.....................................    15
Statement of Constitutional Authority............................    15
Applicability to Legislative Branch..............................    15
Statement on Duplication of Federal Programs.....................    15
Disclosure of Directed Rulemaking................................    16
Section-by-Section Analysis of the Legislation...................    16
Changes in Existing Law Made by the Bill as Reported.............    18

                          Purpose and Summary

    H.R. 3521, the ``Department of Veterans Affairs Major 
Medical Facility Lease Authorization Act of 2013,'' was 
introduced by Representative Jefferson Miller of Florida, 
Chairman of the Committee on Veterans' Affairs, on November 18, 
2013.
    H.R. 3521 would:
    1. Authorize the Department of Veterans Affairs (VA) to 
carry out specified major medical facility leases (requested by 
the Department in the fiscal year 2014 budget submission) at 
the following locations: (1) Albuquerque, NM, for an amount of 
$9,560,000; (2) Brink, NJ, for an amount of $7,280,000; (3) 
Charleston, SC, for an amount of $7,070,250; (4) Cobb County, 
GA, for an amount of $6,409,000; (5) Honolulu, HI, for an 
amount of $15,887,370; (6) Johnson County, KS, for an amount of 
$2,263,000; (7) Lafayette, LA, for an amount of $2,996,000; (8) 
Lake Charles, LA, for an amount of $2,626,000; (9) New Port 
Richey, FL, for an amount of $11,927,000; (10) Ponce, PR, for 
an amount of $11,535,000; (11) San Antonio, TX, for an amount 
of $19,426,000; (12) San Diego, CA, for an amount of 
$11,946,100; (13) Tyler, TX, for an amount of $4,327,000; (14) 
West Haven, CT, for an amount of $4,883,000; (15) Worcester, 
MA, for an amount of $4,855,000; (16) Cape Girardeau, MO, for 
an amount of $4,232,060; (17) Chattanooga, TN, for an amount of 
$7,069,000; (18) Chico, CA, for an amount of $4,534,000; (19) 
Chula Vista, CA, for an amount of $3,714,000; (20) Hines, IL 
for an amount of $22,032,000; (21) Houston, TX, for an amount 
of $6,142,000; (22) Lincoln, NE, for an amount of $7,178,400; 
(23) Lubbock, TX, for an amount of $8,554,000; (24) Myrtle 
Beach, SC, for an amount of $8,022,000; (25) Phoenix, AZ, for 
an amount of $20,757,000; (26) Redding, CA, for an amount of 
$8,154,000; and (27) Tulsa, OK, for an amount of $13,269,200.
    2. Make the following Congressional findings: (1) VA is 
required under title 31, United States Code (U.S.C.), to record 
the full cost of its contractual obligation against funds 
available at the time a contract is executed; (2) the Office of 
Management and Budget (OMB) Circular A-11 provides guidance to 
agencies in meeting the requirements of title 31, U.S.C., with 
respect to leases; and, (3) OMB Circular A-11 requires VA to 
record the up-front budget authority for operating leases in 
the amount of the total payments under the full term of the 
lease or sufficient payments to cover the first year lease 
payments plus cancellation costs.
    3. Require VA, subject to the availability of 
appropriations provided in advance, to record the full cost of 
the contractual obligation at the time a contract is executed 
either in an amount equal to total payments required under the 
full term of the lease; or equal to an amount sufficient to 
cover the first year lease payments and any specified 
cancellation costs in the event that the lease is terminated 
before its full term.
    4. Require VA to provide a detailed analysis of how such 
lease is expected to comply with OMB Circular A-11 and section 
1341 of title 31, U.S.C. in a prospectus for a proposed lease.
    5. Require VA to submit to the Committees on Veterans' 
Affairs not less than 30 days before entering into a major 
medical facility lease, the following information: (1) notice 
of the intent to enter into a lease; (2) a copy of the proposed 
lease; (3) an explanation of any difference between the 
prospectus and the lease submitted under this subsection; and 
(4) a scoring analysis demonstrating compliance with OMB 
Circular A-11.
    6. Require VA to submit to the Committees on Veterans' 
Affairs a report of any material differences between the lease 
VA ultimately enters into and the proposed lease in VA's 
prospective not less than 30 days after entering into a major 
medical facility lease.
    7. Stipulate that the legislation does not relieve VA from 
any statutory or regulatory obligation or requirements existing 
prior to the enactment of the legislation.

                  Background and Need for Legislation

    VA is the third largest real property owner in the Federal 
government, maintaining more than 170 million square feet of 
medical facilities and administrative space across 
approximately 7,786 buildings located on more than 35 thousand 
acres of land. The Veterans Health Administration (VHA) is 
comprised of approximately 5,439 buildings across more than 
14.8 million square feet. VHA's capital asset portfolio 
includes both VA-owned and VA-leased property. As of November 
2012, VHA encompassed approximately 1,636 leased assets.
    Section 8104 of title 38, U.S.C., requires that VA major 
medical facility leases, defined as ``a lease for space for use 
as a new medical facility at an average annual rent of more 
than $1 million,'' be specifically authorized by law.
    To obtain Congressional authorization, VA is required to 
submit a prospectus containing detailed information about each 
proposed lease. According to the statute, each prospectus 
should include a detailed description of the proposed project; 
the estimated total cost of the project; estimated equipment 
costs; current and projected operating costs; demographic data; 
current and projected workload and utilization data; and, the 
priority score assigned to the lease under the Department's 
prioritization methodology.
    VA's fiscal year (FY) 2013 and 2014 budget submission 
requested authorization for the following 27 major medical 
facility leases.
    Albuquerque, New Mexico: VA's FY 2013 and 2014 budget 
submissions request $9.56 million for the replacement of the 
current leased space containing the Clinical Research Pharmacy 
Coordinating Center (CRPCC) in Albuquerque, New Mexico. 
According to VA, the proposed replacement lease would continue 
valuable and unique programs which include all pharmaceutical, 
regulatory, and research participant safety monitoring support 
for all VA Cooperative Studies Programs aimed at improving 
veteran health. The current lease agreement for the existing 
facility is set to expire on August 31, 2015. The proposed 
leased facility would occupy 80,000 net usable square feet.
    Brick, New Jersey: VA's FY 2013 and 2014 budget submissions 
request $7.28 million for a replacement community based 
outpatient clinic (CBOC) in Brick, New Jersey, supporting the 
parent facility, the East Orange Campus of the New Jersey 
Veterans Health Care System. According to VA, the proposed 
replacement CBOC lease would expand the current facility by 
increasing the net usable square feet from 34,000 to 60,000, 
which would accommodate future workload growth and allow for 
expanded services including, radiology, dental, optometry, 
physical therapy, and ophthalmology care.
    Charleston, South Carolina: VA's FY 2013 and 2014 budget 
submissions request $7.07 million for leasing of a Clinical 
Annex Lease in Charleston, South Carolina, which will allow for 
relocation and consolidation of services with another expiring 
lease, and expansion of services in support of the parent 
facility of the Charleston VA Medical Center. According to VA, 
the proposed lease would provide expanded services, increase 
access to care for veteran patients, and address future 
utilization, workload and space requirements. The proposed 
leased facility would occupy 75,000 net usable square feet and 
would serve approximately 20,722 veterans.
    Cobb County; Georgia: VA's FY 2013 and 2014 budget 
submissions request $6.41 million for a new, leased CBOC in 
northern Cobb County, Georgia, to consolidate and expand 
services currently offered at an existing CBOC that supports 
the Atlanta VA Medical Center. According to VA, the proposed 
leased facility would expand outpatient and mental health care 
services, increasing access to veterans in Northern Cobb 
County. The proposed leased facility would occupy 64,000 net 
usable square feet and be expected to serve approximately 
64,000 veterans.
    Honolulu, Hawaii: VA's FY 2013 and 2014 budget submissions 
request $15.89 million for a new lease of an outpatient medical 
care center in Ewa Plain, Oahu, Hawaii. According to VA, the 
proposed leased facility would increase access to primary care, 
mental health care, specialty care, radiology care, laboratory 
services, pharmacy services, and telehealth services, while 
lessening the need for veteran travel to the Honolulu VA 
medical center. The proposed leased facility would encompass a 
collocated clinic for military branch entities, with VA and the 
Department of Defense sharing clinical, ancillary, and support 
functions. It would also allow for the collocation of several 
VA functions, including the Veterans Benefits Administration 
Honolulu Regional Office and the Kapolei Vet Center. The 
proposed leased facility would occupy 118,823 net usable square 
feet.
    Johnson County, Kansas: VA's FY 2013 and 2014 budget 
submissions request $2.26 million for a new CBOC lease in 
Johnson County, Kansas. According to VA, the proposed leased 
facility would increase access to care for Johnson County 
veterans who currently travel more than 30 minutes to access 
care at the Kansas City VA medical center and provide 
comprehensive outpatient services as well as ancillary and 
support services including radiology care and laboratory and 
pharmacy services. The proposed leased facility would occupy 
22,910 net usable square feet and would be expected to serve 
approximately 11,327 veterans.
    Lafayette, Louisiana: VA's FY 2013 and 2014 budget 
submissions request $2.99 million for a replacement CBOC in 
Lafayette, Louisiana. According to VA, the proposed leased 
facility would mitigate space and workload gaps throughout 
Veterans Integrated Service Network 16 and alleviate the need 
for veterans to travel 180 miles to the Alexandria VA medical 
center. It would also provide increased access to primary, 
specialty, mental health, and women's health care and dental, 
imaging, physical therapy, urology, ophthalmology, and 
dermatology services to Louisiana veterans. The proposed leased 
facility would occupy 29,224 net usable square feet and serve 
approximately 7,227 veterans.
    Lake Charles, Louisiana: VA's FY 2013 and 2014 budget 
submissions request $2.63 million for a new CBOC in Lake 
Charles, Louisiana. According to VA, the proposed leased 
facility would provide outpatient services that would alleviate 
current access deficiencies. The proposed leased facility would 
occupy 24,088 net usable square feet and would be expected to 
serve approximately 6,000 veterans.
    New Port Richey, Florida: VA's FY 2013 and 2014 budget 
submissions request $11.93 million for a new CBOC in New Port 
Richey, Florida. According to VA, the proposed lease facility 
would consolidate and expand services currently offered in five 
different clinics located within 20 miles of New Port Richey 
into one, single facility and provide access to expanded 
outpatient services. The proposed leased facility would occupy 
114,000 net usable space square feet and would be expected to 
serve approximately 14,845 veterans.
    Ponce, Puerto Rico: VA's FY 2013 and 2014 budget 
submissions request $11.54 million for a replacement CBOC lease 
in Ponce, Puerto Rico. According to VA, the proposed leased 
facility would provide expanded outpatient services to address 
utilization and space deficiencies and reduce patient waiting 
and travel times. The current CBOC lease will expire in 
February 2015. The proposed leased facility would occupy 
114,300 net usable square feet and would be expected to serve 
approximately 11,619 veterans.
    San Antonio, Texas: VA's FY 2013 and 2014 budget 
submissions request $19.43 million for a replacement Outpatient 
Clinic (OC) lease in San Antonio, Texas. According to VA, the 
proposed leased facility would replace and consolidate the 
current OC, two annex leases, three specialty care clinic 
leases, and one contract clinic. The new consolidated clinic 
would provide increased access to expanded services including 
primary, mental health, specialty, surgery, dental, vision, and 
women's health care. The proposed leased facility would occupy 
190,800 net usable square feet and would be expected to serve 
approximately 55,753 veterans.
    San Diego, California: VA's FY 2013 and 2014 budget 
submissions request $11.95 million for a replacement CBOC lease 
in San Diego, California. According to VA, the proposed leased 
facility would integrate primary, mental health, and specialty 
care and ancillary services and provide increased access to 
expanded services including women's health, audiology, eye, and 
blind rehabilitation care. It would also increase operational 
efficiencies. The proposed leased facility would occupy 99,986 
net usable square feet and would be expected to serve 
approximately 32,832 veterans.
    Tyler, Texas: VA's FY 2013 and 2014 budget submissions 
request $4.33 million for a replacement CBOC lease in Tyler, 
Texas. According to VA, the proposed leased facility would 
consolidate services currently offered in two existing CBOCs, 
which would improve the provision of primary, specialty, and 
mental health care to Texas veterans. It would also alleviate 
current primary and specialty care deficiencies in the Smith 
County, Texas, area and lessen the need for veterans to travel 
to the Dallas VA medical center for some specialty services. 
The proposed leased facility would occupy 48,425 net usable 
square feet and would serve approximately 4,489 veterans.
    West Haven, Connecticut: VA's FY 2013 and 2014 budget 
submissions request $4.88 million for a new Community Care 
Center lease in West Haven, Connecticut. According to VA, the 
proposed leased facility would replace and expand the current 
Errera Community Center, which provides intensive support 
services, substance use counseling, psychosocial 
rehabilitation, and integrated psychosocial and biomedical 
treatment to aging veterans, at-risk veterans, and veterans 
with mental health issues. The proposed facility would occupy 
45,000 net usable space square feet.
    Worcester, Massachusetts: VA's FY 2014 budget submissions 
request $4.86 million for a replacement CBOC lease in 
Worcester, Massachusetts. According to VA, the proposed leased 
facility would replace the current CBOC and alleviate existing 
space deficiencies. It would provide increased access to 
outpatient primary care and other services including 
cardiology, audiology, dermatology, geriatric, nutritional, 
vision, imaging, and mental health services. The proposed 
leased facility would occupy 40,000 net usable square feet.
    Cape Girardeau, Missouri: VA's FY 2014 budget submissions 
request $4.23 million for a new CBOC lease in Cape Girardeau, 
Missouri. According to VA, the proposed leased facility would 
enhance existing VA outpatient services in the Cape Girardeau 
area and alleviate existing patient waiting times and space, 
utilization, and parking deficiencies. It would also provide 
increased access to primary, specialty, women's, and mental 
health care and rehabilitative, home health, and ancillary 
services. The proposed leased facility would occupy 
approximately 43,000 net usable square feet and would be 
expected to serve 4,997 veterans.
    Chattanooga, Tennessee: VA's FY 2014 budget submissions 
request $7.07 million for the expansion of a multispecialty 
CBOC in Chattanooga, Tennessee. According to VA, the proposed 
leased facility would expand clinical services and increase 
access to primary, specialty, and mental health care. It would 
also provide increased access to outpatient services and 
alleviate existing patient waiting times, and space 
deficiencies. The proposed leased facility would occupy 75,000 
net usable square feet and would serve approximately 18,322 
veterans.
    Chico, California: VA's FY 2014 budget submissions request 
$4.53 million for a replacement CBOC lease in Chico, 
California. According to VA, the proposed leased facility would 
replace the existing Chico CBOC and increase access to 
telemedicine services including, allergy, nephrology, 
rheumatology, infectious disease, and immunology services. It 
would also alleviate existing patient waiting times and 
projected utilization and space needs. The proposed leased 
facility would occupy 42,000 net usable square feet and would 
be expected to serve approximately 8,489 veterans.
    Chula Vista, California: VA's FY 2014 budget submissions 
request $3.71 million for a replacement CBOC lease in Chula 
Vista, California. According to VA, the proposed leased 
facility would address current and projected space shortages 
and provide increased access to audiology, speech pathology, 
vision, mental health, laboratory, radiology, and primary care. 
The proposed leased facility would occupy 31,000 net usable 
square feet and would be expected to serve 7,327 veterans.
    Hines, Illinois: VA's FY 2014 budget submissions request 
$22.03 million for a new research lease in Hines, Illinois. 
According to VA, the proposed leased facility would alleviate 
current facility condition deficiencies and provide a safe 
research space in support of multiple VA research programs 
including Basic Laboratory Research and Development and Health 
Services Research and Development. The proposed leased facility 
would occupy 164,000 net usable square feet and would replace 
the outdated current research facility that was built in 1921.
    Houston, Texas: VA's FY 2014 budget submissions request 
$6.14 million for a replacement research lease in Houston, 
Texas. According to VA, the proposed leased facility would 
replace the existing research lease and support increases in 
grant funding and a new Veteran Engineering Resource Center, as 
well as provide space for research-related equipment, library, 
offices, and meeting rooms. The proposed leased facility would 
occupy 48,000 net usable square feet.
    Lincoln, Nebraska: VA's FY 2014 budget submissions request 
$7.18 million for a new CBOC lease in Lincoln, Nebraska. 
According to VA, the proposed leased facility would integrate 
the delivery of primary, specialty, and mental health care and 
ancillary services and allow for the replacement of the current 
84-year-old facility. The proposed leased facility would occupy 
72,000 net usable square feet and would be expected to serve 
approximately 15,200 veterans.
    Lubbock, Texas: VA's FY 2014 budget submissions request 
$8.55 million for a new CBOC lease in Lubbock, Texas. According 
to VA, the proposed leased facility would replace the current 
Lubbock CBOC, increase access to outpatient services, and 
alleviate existing patient waiting time and space deficiencies. 
It would also increase access to endoscopy, day surgery, 
gastroenterology, and audiology care to Texas veterans. The 
proposed leased facility would occupy 94,000 net usable square 
feet.
    Myrtle Beach, South Carolina: VA's FY 2014 budget 
submissions request $8.02 million for a new CBOC lease in 
Myrtle Beach, South Carolina. According to VA, the new leased 
facility would replace and consolidate two existing CBOCs and 
accommodate projected workload and space needs. It would also 
accommodate projected workload increases. The proposed leased 
facility would occupy 84,000 net usable square feet and would 
serve approximately 11,106 veterans.
    Phoenix, Arizona: VA's FY 2014 budget submissions request 
$20.76 million for a new CBOC lease in Phoenix, Arizona. 
According to VA, the proposed leased facility would enhance VA 
outpatient services and alleviate existing patient waiting 
time, and workload and space deficiencies. It would also allow 
for increased education, recruitment, and research initiatives 
in closer proximity to the Phoenix VA health care system's 
university affiliate. The proposed leased facility would occupy 
203,000 net usable square feet and would be expected to serve 
approximately 64,878 veterans.
    Redding, California: VA's FY 2014 budget submissions 
request $8.15 million for a replacement CBOC lease in Redding, 
California. According to VA, the proposed leased facility would 
replace the current Redding CBOC and accommodate patient 
workload growth in primary, specialty, and mental health care. 
It would also increase access to telemedicine and improve 
clinical, administrative, and support function workspace. The 
proposed leased facility would occupy 77,000 net usable square 
feet and would serve approximately 14,856 veterans.
    Tulsa, Oklahoma: VA's FY 2014 budget submissions request 
$13.27 million for a replacement CBOC in Tulsa, Oklahoma. 
According to VA, the proposed leased facility would replace the 
existing Tulsa OC and Tulsa Behavioral Medicine Clinic, 
increase access to VA outpatient services, and alleviate 
existing patient waiting time, utilization, and space 
deficiencies. It would also improve the provision of primary, 
specialty, surgical and mental health care and imaging, 
laboratory, and pharmacy services to Oklahoma veterans. The 
proposed leased facility would occupy 140,000 net usable square 
feet and would be expected to serve approximately 25,806 
veterans.

Deficiencies in VA's lease procurement and management process

    It is the responsibility of the Committee to ensure that VA 
is given the appropriate authority to undertake necessary 
capital investments for the purpose of effectively serving our 
nation's veterans and ensuring access to the care and services 
they need. The Committee is deeply troubled by the ineffective 
management and deficiencies uncovered through Committee 
oversight of VA's lease procurement process. On October 22, 
2013, the VA Inspector General (IG) issued a report, entitled, 
``Review of VA's Management of Health Care Center Leases.'' The 
findings in this report substantiate the ongoing significant 
and serious failures in VA's lease procurement and management. 
Specifically, the IG found:
          --Lack of Guidance--VA's management of the timeliness 
        and costs in the Health Care Center (HCC) lease 
        procurement process has been ineffective due to the 
        lack of guidance available for planning lease projects 
        with such high annual rent as the HCCs;
          --Inaccurate Milestones--VA established identical 
        milestones for completing the seven HCCs even though 
        the projects varied in size and budget and failed to 
        meet the milestones, in spite of providing Congress 
        with an aggressive project schedule;
          --Lack of Documentation--VA could not provide 
        documentation to support whether the Department 
        adequately assessed the feasibility of accomplishing 
        the HCCs in the promised 32-month time frame; and,
          --Lack of Central Tracking--VA could not provide 
        accurate information on HCC spending into April 2013 as 
        central cost tracking was not in place to ensure 
        transparency and accurate reporting of all HCC 
        expenditures.
    The IG recommended that VA: (1) establish adequate guidance 
for management of the procurement process of large-scale build-
to-lease facilities; (2) provide realistic and justifiable 
timelines for HCC completion; (3) ensure HCC project analyses 
and key decisions are supported and documented; and, (4) 
establish central cost tracking to ensure transparency and 
accurate reporting of HCC expenditures.
    VA concurred with each of the IG's recommendations. It is 
the Committee's expectation that VA will fully implement each 
of these recommendations prior to initiating lease procurement 
in the 27 major medical facility leases included in this 
legislation.

Budgetary treatment of VA Major Medical Facility Leases

    The Anti-Deficiency Act (31 U.S.C. Sec. 1341(a)(1) 
prohibits federal employees from making or authorizing an 
expenditure from, or creating or authorizing an obligation 
under, any appropriation or fund in excess of the amount 
available in the appropriation or fund unless authorized by 
law, and involving the government in any obligation to pay 
money before funds have been appropriated for that purpose, 
unless otherwise allowed by law, in addition to other 
requirements. OMB Circular A-11 provides instructions to 
agencies on the budgetary treatment of lease-purchase and 
leases of capital assets consistent with the scorekeeping rules 
originally promulgated in connection with the Budget 
Enforcement Act of 1990 (BEA) and the Anti-Deficiency Act. 
Agencies are required to obligate at the time they enter into a 
binding commitment budget authority in the amount necessary to 
cover the Government's legal obligations, consistent with the 
requirements of the Anti-Deficiency Act and in the manner 
directed in OMB Circular A-11. OMB Circular A-11 and the Anti-
Deficiency Act require budgeting for both the estimated total 
payments expected to arise under the full term of the contract 
or, if the contract includes a cancellation clause, an amount 
sufficient to cover the lease payments for the first year plus 
an amount sufficient to cover the costs associated with 
cancellation of the contract.
    After receiving information about how VA had exercised the 
authority provided in prior VA major medical facilities leasing 
authorizations, the Congressional Budget Office (CBO) has 
concluded that VA has been entering into binding obligations 
for the full period of the lease. Consistent with the 
longstanding laws and budget rules discussed above, VA is 
required to obligate the budget authority upfront for the full 
amount of those obligations. This is consistent with the plain 
language of the law, OMB's A-11 guidance, and the underlying 
principle of congressional control over public spending.
    There is serious doubt as to whether VA has been properly 
recording the cost of its leases when using the leasing 
authority provided in the prior medical facilities 
authorizations acts. Given VA's prior practice, CBO has 
determined that VA has implemented priori authorizations as if 
they provided contract authority, a type of mandatory budget 
authority that permits an agency to enter into obligations on 
behalf of the U.S. Government in advance of funds being 
appropriated to liquidate that obligation. This legislation 
includes language designed to ensure that VA exercises the 
authority provided in this legislation consistent with the 
express congressional intent that the agency only enter into 
binding commitments on behalf of the U.S. Government once funds 
have been appropriated for the purpose of that proposed 
commitment and that VA obligate the full cost of that 
commitment at the time it executes the lease.
    Specifically in furtherance of congressional intent, the 
legislation would:
          (1) require VA to comply with the Anti-Deficiency Act 
        and OMB Circular A-11 in exercising the authority to 
        enter into leases provided by the bill;
          (2) authorize VA to enter into obligations on behalf 
        of the U.S. Government only to the extent amounts are 
        provided in advance in appropriations acts;
          (3) require VA to provide a lease analysis to 
        Congress prior to signing any lease agreement under the 
        authority provided in this bill including detailed 
        information on how it is exercising its leasing 
        authorities in compliance with OMB Circular A-11 and 
        the Anti-Deficiency Act; and,
          (4) require VA to submit to Congress, not more than 
        30 days after entering into a major medical facility 
        lease, a report on any material differences between the 
        lease that was entered into and the proposed lease, 
        including how the lease that was entered into changes 
        the previously submitted scoring analysis.
    If VA fails to faithfully execute the intent of this 
legislation and to comply with the longstanding laws governing 
obligations, Congress will revisit this issue in the context of 
future requests for leasing authority.

                                Hearings

    On June 27, 2013, the Full Committee held an oversight 
hearing regarding the implications of CBO's scoring of major 
medical facility lease authorizations and possible alternate 
options for effectively meeting the care needs of veterans.

                        Committee Consideration

    On November 20, 2013, the Full Committee met in an open 
markup session, a quorum being present and ordered H.R. 3521 
reported favorably to the House of Representatives by voice 
vote.

                            Committee Votes

    Clause 3(b) of rule XIII of the Rules of the House of 
Representatives requires the Committee to list the recorded 
votes on the motion to report the legislation and amendments 
thereto. There were no recorded votes taken on amendments or in 
connection with ordering H.R. 3521 reported to the House. A 
Motion by Mr. Michaud of Maine to order H.R. 3521 reported 
favorably to the House of Representatives was agreed to by 
voice vote.

                      Committee Oversight Findings

    In compliance with clause 3(c) of rule XIII and clause 
(2)(b)(1) of rule X of the Rules of the House of 
Representatives, the Committee's oversight findings and 
recommendations are reflected in the descriptive portions of 
this report.

         Statement of General Performance Goals and Objectives

    In accordance with rule 3(c)(4) of rule XIII of the Rules 
of the House of Representatives, the Committee's performance 
goals and objectives are reflected in the descriptive portions 
of this report.

   New Budget Authority, Entitlement Authority, and Tax Expenditures

    In compliance with clause 3(c)(2) of rule XIII of the Rules 
of the House of Representatives, the Committee adopts as its 
own the estimate of new budget authority, entitlement 
authority, or tax expenditures or revenues contained in the 
cost estimate prepared by the director of the Congressional 
Budget Office pursuant to section 402 of the Congressional 
Budget Act of 1974.

                  Earmarks and Tax and Tariff Benefits

    H.R. 3521 does not contain any congressional earmarks, 
limited tax benefits, or limited tariff benefits as defined in 
clause 9 of rule XXI of the Rules of the House of 
Representatives.

                        Committee Cost Estimate

    The Committee adopts as its own the cost estimate prepared 
by the director of the Congressional Budget Office pursuant to 
section 402 of the Congressional Budget Act of 1974.

                  Congressional Budget Office Estimate

    Pursuant to clause 3(c)(3) of rule XIII of the Rules of the 
House of Representatives, the following is the cost estimate 
for H.R. 3521 provided by the Congressional Budget Office 
pursuant to section 402 of the Congressional Budget Act of 
1974.

                                     U.S. Congress,
                               Congressional Budget Office,
                                  Washington, DC, December 6, 2013.
Hon. Jeff Miller,
Chairman, Committee on Veterans' Affairs,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 3521, the 
Department of Veterans Affairs Major Medical Facility Lease 
Authorization Act of 2013.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is David Newman.
            Sincerely,
                                              Douglas W. Elmendorf.
    Enclosure.

H.R. 3521--Department of Veterans Affairs Major Medical Facility Lease 
        Authorization Act of 2013

    Summary: H.R. 3521 would authorize the Department of 
Veterans Affairs (VA) to enter into leases to obtain the use of 
major medical facilities at 27 specified locations. Based on 
VA's long-established practice, CBO expects that the department 
would implement that authorization by awarding contracts for 
the construction and long-term use of those facilities without 
recording the full amount of the government's commitment as an 
obligation of its appropriated funds. Thus, H.R. 3521 would 
effectively be providing budget authority for an amount of 
obligations that exceeds what we expect VA initially would 
charge against its appropriation. By CBO's estimate, that 
additional budget authority would amount to $1.4 billion.
    Hence, CBO estimates that enacting this bill would increase 
direct spending by about $1.4 billion over the 2014-2023 
period. Because the bill would affect direct spending, pay-as-
you-go procedures apply. We also estimate that, assuming 
appropriation of the necessary amounts, implementing the bill 
would have a discretionary cost of $124 million over the 2014-
2023 period. Enacting H.R. 3521 would not affect federal 
revenues.
    H.R. 3521 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act (UMRA) 
and would not affect the budgets of state, local, or tribal 
governments.
    Estimated cost to the Federal Government: The estimated 
budgetary impact of H.R. 3521 is shown in the following table. 
The costs of this legislation fall within budget function 700 
(veterans benefits and services).

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                             By fiscal year, in millions of dollars--
                                         ---------------------------------------------------------------------------------------------------------------
                                            2014     2015     2016     2017     2018     2019     2020     2021     2022     2023   2014-2018  2014-2023
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               CHANGES IN DIRECT SPENDING

Estimated Budget Authority..............       41        0    1,378        0        0        0        0        0        0        0     1,419      1,419
Estimated Outlays.......................        2       11       83      382      459      345      137        0        0        0       937      1,419

                                                     CHANGES IN SPENDING SUBJECT TO APPROPRIATION\a\

Estimated Authorization Level...........        0        0      124        0        0        0        0        0        0        0       124        124
Estimated Outlays.......................        0        0       87       31        6        0        0        0        0        0       124        124
--------------------------------------------------------------------------------------------------------------------------------------------------------
\a\Changes in spending subject to appropriations exclude $3 million that CBO expects would be paid from currently available appropriations.

    Basis of estimate: For this estimate, CBO assumes that the 
legislation will be enacted early in 2014 and that outlays will 
follow historical spending patterns for major construction 
projects carried out by VA.

CBO's Assessment: VA's long-term obligations as purchases

    Section 2 of H.R. 3521 would authorize VA to acquire the 
use of 27 medical facilities and would set a limit on the cost 
of each lease. VA classifies its contracts for acquiring 
similar facilities as operating leases. However, on the basis 
of information from VA regarding those transactions, CBO has 
concluded that most of them are akin to government purchases of 
facilities built specifically for VA's use--but instead of 
being financed by the U.S. Treasury, they rely on third-party 
financing (that is, funds raised by a nonfederal entity), which 
is generally more expensive.\1\ That conclusion is based on 
those leases having many of the following key features:
---------------------------------------------------------------------------
    \1\For more information on the budgetary treatment of third-party 
financing, see Congressional Budget Office, Third-Party Financing of 
Federal Projects (June 2005), www.cbo.gov/publication/16554.
---------------------------------------------------------------------------
           The facilities are designed and constructed 
        to the unique specifications of the government;
           The facilities are constructed at the 
        request of the federal government;
           The leases on the newly constructed 
        facilities are long term--usually 20 years;
           Typically, payments from the federal 
        government are the only or primary source of income for 
        the facilities;
           The term of the contractual agreements 
        coincides with the term of the private partner's 
        financing instrument for developing and constructing 
        the facility (that is, a facility financed with a 20-
        year bond will have a 20-year lease term);
           The federal government commits to make fixed 
        annual payments that are sufficient to service the debt 
        incurred to develop and construct the facility, 
        regardless of whether the agency continues to occupy 
        the facility during the guaranteed term of the lease; 
        and
           The fixed payments over the life of the 
        lease are sufficient to retire the debt for the 
        facility.\2\
---------------------------------------------------------------------------
    \2\See the Statement of Robert A. Sunshine, Deputy Director, 
Congressional Budget Office, The Budgetary Treatment of Medical 
Facility Leases by the Department of Veterans Affairs, before the House 
Committee on Veterans' Affairs, (June 27, 2013), www.cbo.gov/
publication/44368. 
---------------------------------------------------------------------------
    Thus, although those transactions are structured as leases, 
they are essentially government purchases. Following the normal 
procedures governing the budgetary treatment of such purchases, 
budget authority should be available and obligations should be 
recorded up front when the acquisitions are initiated in 
amounts equal to the development and construction costs of the 
medical facilities. Instead, VA records a small fraction of the 
costs as obligations when it awards the contracts for such 
transactions.
    To the extent that the full costs of developing and 
constructing the facilities exceeds the relatively small amount 
that VA would initially record as obligations against its 
appropriation, CBO treats the legislative authorization for 
those transactions as contract authority--a type of budget 
authority that allows an agency to enter into a contract and 
incur an obligation before receiving an appropriation for those 
activities. Because the contract authority would be provided in 
authorizing legislation, H.R. 3521, rather than in an 
appropriation act, the resulting spending is categorized as 
direct spending (as distinguished from discretionary spending, 
which results from appropriation acts).
    CBO's estimate of direct spending for H.R. 3521 shows the 
additional budget authority needed for the costs of developing 
and constructing the facilities when the contracts would be 
awarded, over and above the $127 million that CBO estimates 
would be charged against VA's discretionary appropriations at 
those times. (VA would obligate those appropriations for 
certain special features of the facilities; the initial annual 
lease payments would begin later, after the facilities were 
constructed.) CBO expects that $3 million of the $127 million 
would be paid from already enacted appropriations for the 
special features of two facilities for which the contracts 
would be awarded in 2014. That amount is not included in this 
estimate.
    Documentation for the projects indicates that contracts for 
the rest of the facilities would be awarded in 2016. Thus, CBO 
estimates that the bill would create $41 million of additional 
budget authority in 2014 for the first two projects, and 
another $1.4 billion in 2016 for the others. Outlays are 
estimated to occur over the 2014-2020 period, when the 
facilities would be constructed. All told, the bill would 
increase direct spending by about $1.4 billion over the 2014-
2023 period, CBO estimates.

VA's Categorization: Long-term obligations as leases

    VA considers its long-term agreements for medical 
facilities to be straightforward operating leases (and not 
effectively purchases). Even if that was the case, however, it 
appears that the department generally has not been properly 
recording its obligations for such leases. Circular A-11 issued 
by the Office of Management and Budget specifies that operating 
leases require up-front budget authority in an amount equal to 
total payments over the full term of the lease or an amount 
sufficient to cover first-year lease payments plus cancellation 
costs.\3\ But for lease contracts that do not permit early 
cancellation, VA has only recorded obligations for payments due 
in the year the lease was awarded; as a result, the 
government's actual obligations for contracts have exceeded the 
amount the agency has recorded.
---------------------------------------------------------------------------
    \3\See the Office of Management and Budget, Preparation, 
Submission, and Execution of the Budget, Circular A-11 (August 2012), 
Appendix B.
---------------------------------------------------------------------------
    H.R. 3521 would not require VA to change its current 
practices. Section 3 of the bill would require VA to record an 
obligation at the time a contract is signed in an amount equal 
to either the total payments that would be made under its full 
term, or an amount equal to the sum of the first annual lease 
payment and any specified cancellation costs. That requirement, 
however, would be contingent upon the availability of 
sufficient appropriations to record those amounts. Moreover, 
the amounts specified for the leases in section 2 of the bill 
are consistent only with the up-front payments for certain 
design features of the facilities and for the first annual 
lease payment. Appropriations of those amounts would not be 
sufficient to cover the contractual obligations under either 
recording method specified in section 3. Nevertheless, VA's 
authority to enter into the leases under section 2 would not be 
constrained if appropriations were not sufficient to cover the 
full amount of the lease obligations as properly recorded.
    VA has not indicated whether it would interpret H.R. 3521 
as requiring it to increase the amount of the obligations it 
records when it awards such contracts. CBO expects that when VA 
awards contracts for the authorized projects, the department 
might well determine that sufficient appropriations were not 
available to record those larger amounts, and it would continue 
its practice of recording obligations equal only to the 
payments due in the year a contract is awarded.
    Thus, even if the contracts for the 27 facilities were to 
be considered operating leases, CBO believes that enacting H.R. 
3521 would have the effect of providing VA with the authority 
to enter into those leases without sufficient appropriations to 
cover the obligations as required by Circular A-11. If the new 
leases did not specify cancellation costs (as was the case for 
the past leases CBO has reviewed), obligations recorded for 
these 27 contracts if they were considered operating leases 
should be the total payments due over the term of the lease. 
CBO estimates that those obligations would total $2.3 billion. 
Hence, the additional budget authority provided by this bill--
that is, the full cost of the leases other than the first-year 
payments--would amount to $2.2 billion. The outlays would be 
spread over the term of the leases, so that the additional 
outlays would come to about $670 million over the 2014-2023 
period, with the remaining $1.5 billion occurring in subsequent 
years. However, because CBO views the leases as essentially 
government purchases, this estimate does not reflect those 
amounts but instead reflects the amounts described in the 
previous section.
    Pay-As-You-Go Considerations: The Statutory Pay-As-You-Go 
Act of 2010 establishes budget-reporting and enforcement 
procedures for legislation affecting direct spending or 
revenues. The net changes in outlays that are subject to those 
pay-as-you-go procedures are shown in the following table.

        CBO ESTIMATE OF PAY-AS-YOU-GO EFFECTS FOR H.R. 3521 AS ORDERED REPORTED BY THE HOUSE COMMITTEE ON VETERANS' AFFAIRS ON NOVEMBER 20, 2013
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                       By fiscal year, in millions of dollars--
                                                             -------------------------------------------------------------------------------------------
                                                               2014   2015   2016   2017   2018   2019   2020   2021   2022   2023  2014-2018  2014-2023
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               NET INCREASE IN THE DEFICIT

Statutory Pay-As-You-Go Impact..............................      2     11     83    382    459    345    137      0      0      0       937      1,419
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Intergovernmental and private-sector impact: H.R. 3521 
contains no intergovernmental or private-sector mandates as 
defined in UMRA and would not affect the budgets of state, 
local, or tribal governments.
    Estimate prepared by: Federal costs: Ann E. Futrell and 
David Newman; Impact on state, local, and tribal governments: 
J'nell L. Blanco; Impact on the private sector: Elizabeth Bass.
    Estimate approved by: Theresa Gullo, Deputy Assistant 
Director for Budget Analysis.

                       Federal Mandates Statement

    The Committee adopts as its own the estimate of federal 
mandates regarding H.R. 3521 prepared by the director of the 
Congressional Budget Office pursuant to section 423 of the 
Unfunded Mandates Reform Act.

                      Advisory Committee Statement

    No advisory committees within the meaning of section 5(b) 
of the Federal Advisory Committee Act would be created by this 
legislation.

                   Constitutional Authority Statement

    Pursuant to clause 3(d)(1) of rule XIII of the Rules of the 
House of Representatives, the Committee finds that the 
constitutional authority for this legislation is provided by 
Article I, section 8 of the United States Constitution.

                  Applicability to Legislative Branch

    The Committee finds that the legislation does not relate to 
the terms and conditions of employment, or to access to public 
services or accommodations within the meaning of the 
Congressional Accountability Act of 1995, 2 U.S.C. 
Sec. 1302(b)(3).

              Statement on Duplication of Federal Programs

    Pursuant to section 3(j) of H. Res. 5, 113th Cong. (2013), 
the Committee finds that no provision of H.R. 2072, as amended, 
establishes or reauthorizes a program of the Federal Government 
known to be duplicative of another Federal program, a program 
that was included in any report from the Government 
Accountability Office to Congress pursuant to section 21 of 
Public Law 111-139, or a program related to a program 
identified in the most recent Catalog of Federal Domestic 
Assistance.

                   Disclosure of Directed Rulemaking

    Pursuant to section 3(k) of H. Res. 5, 113th Cong. (2013), 
the Committee estimates that H.R. 2072, as amended, does not 
require any directed rule making.

             Section-by-Section Analysis of the Legislation


Section 1. Short title

    Section 1 of the bill would provide the short title of the 
legislation as the ``Department of Veterans Affairs Major 
Medical Facility Lease Authorization Act of 2013.''

Section 2. Authorization of Major Medical Facility Leases

    Section 2(1) of the bill would authorize a lease for a 
clinical research and pharmacy coordinating center in 
Albuquerque, NM, for an amount not to exceed $9,560,000.
    Section 2(2) of the bill would authorize a lease for a 
community-based outpatient clinic in Brick, NJ, for an amount 
not to exceed $7,280,000.
    Section 2(3) of the bill would authorize a lease for a 
primary care and dental clinic annex in Charleston, SC, for an 
amount not to exceed $7,070,250.
    Section 2(4) of the bill would authorize a lease for a 
community-based outpatient clinic in Cobb County, GA, for an 
amount not to exceed $6,409,000.
    Section 2(5) of the bill would authorize a lease for the 
Leeward Outpatient Healthcare Access Center in Honolulu, HI, 
for an amount not to exceed $15,887,370.
    Section 2(6) of the bill would authorize a lease for a 
community-based outpatient clinic in Johnson County, KS, for an 
amount not to exceed $2,263,000.
    Section 2(7) of the bill would authorize a lease for a 
replacement community-based outpatient clinic in Lafayette, LA, 
for an amount not to exceed $2,996,000.
    Section 2(8) of the bill would authorize a lease for a 
community-based outpatient clinic in Lake Charles, LA, for an 
amount not to exceed $2,626,000.
    Section 2(9) of the bill would authorize a lease for an 
outpatient clinic consolidation in New Port Richey, FL, for an 
amount not to exceed $11,927,000.
    Section 2(10) of the bill would authorize a lease for an 
outpatient clinic in Ponce, Puerto Rico, for an amount not to 
exceed $11,535,000.
    Section 2(11) of the bill would authorize a lease for a 
lease consolidation in San Antonio, TX, for an amount not to 
exceed $19,426,000.
    Section 2(12) of the bill would authorize a lease for a 
community-based outpatient clinic in San Diego, CA, for an 
amount not to exceed $11,946,100.
    Section 2(13) of the bill would authorize a lease for an 
outpatient clinic in Tyler, TX, for an amount not to exceed 
$4,327,000.
    Section 2(14) of the bill would authorize a lease for the 
Errera Community Care Center in West Haven, CT, for an amount 
not to exceed $4,883,000.
    Section 2(15) of the bill would authorize a lease for the 
Worcester community-based outpatient clinic in Worcester, MA, 
for an amount not to exceed $4,855,000.
    Section 2(16) of the bill would authorize a lease for the 
expansion of a community-based outpatient clinic in Cape 
Girardeau, MO, for an amount not to exceed $4,232,060.
    Section 2(17) of the bill would authorize a lease for a 
multispecialty clinic in Chattanooga, TN, for an amount not to 
exceed $7,069,000.
    Section 2(18) of the bill would authorize a lease for the 
expansion of a community-based outpatient clinic in Chico, CA, 
for an amount not to exceed $4,534,000.
    Section 2(19) of the bill would authorize a lease for a 
community-based outpatient clinic in Chula Vista, CA, for an 
amount not to exceed $3,714,000.
    Section 2(20) of the bill would authorize a new research 
lease in Hines, IL, for an amount not to exceed $22,032,000.
    Section 2(21) of the bill would authorize a replacement 
research lease in Houston, TX, for an amount not to exceed 
$6,142,000.
    Section 2(22) of the bill would authorize a community-based 
outpatient clinic in Lincoln, NE, for an amount not to exceed 
$7,178,400.
    Section 2(23) of the bill would authorize a community-based 
outpatient clinic in Lubbock, TX, for an amount not to exceed 
$8,554,000.
    Section 2(24) of the bill would authorize a community-based 
outpatient clinic consolidation lease in Myrtle Beach, SC, for 
an amount not to exceed $8,022,000.
    Section 2(25) of the bill would authorize a community-based 
outpatient clinic in Phoenix, AZ, for an amount not to exceed 
$20,757,000.
    Section 2(26) of the bill would authorize a lease for the 
expansion of a community-based outpatient clinic in Redding, 
CA, for an amount not to exceed $8,154,000.
    Section 2(27) of the bill would authorize a lease for the 
expansion of a community-based outpatient clinic in Tulsa, OK, 
for an amount not to exceed $13,269,200.

Section 3. Budgetary treatment of Department of Veterans Affairs Major 
        Medical Facilities Leases

    Section 3(a) of the bill would make the following 
Congressional findings: (1) that VA is required under title 31, 
U.S.C. to record the full cost of its contractual obligation 
against funds available at the time a contract is executed; (2) 
that OMB Circular A-11 provides guidance to agencies in meeting 
the requirements of title 31, U.S.C., with respect to leases; 
and, (3) that OMB Circular A-11 requires VA to record the up-
front budget authority for operating leases in the amount of 
the total payments under the full term of the lease or 
sufficient payments to cover the first year lease payments plus 
cancellation costs.
    Section 3(b) of the bill would require VA, subject to the 
availability of appropriations provided in advance, to record 
the full cost of the contractual obligation at the time a 
contract is executed either in an amount equal to total 
payments required under the full term of the lease; or equal to 
an amount sufficient to cover the first year lease payments and 
any specified cancellation costs in the event that the lease is 
terminated before its full term.
    Section 3(c) of the bill would require VA to provide a 
detailed analysis of how such lease is expected to comply with 
OMB Circular A-11 and section 1341 of title 31, U.S.C. in a 
prospectus for a proposed lease. It would also require VA to 
submit to the Committees on Veterans' Affairs not less than 30 
days before entering into a major medical facility lease, the 
following information: (1) notice of the intent to enter into a 
lease; (2) a copy of the proposed lease; (3) an explanation of 
any difference between the prospectus and the lease submitted 
under this subsection; and (4) a scoring analysis demonstrating 
compliance with OMB Circular A-11; and also require VA to 
submit to the Committees on Veterans' Affairs a report of any 
material differences between the entered lease and proposed 
lease not less than 30 days after entering into a major medical 
facility lease.
    Section 3(d) of the bill would stipulate that the 
legislation does not relieve VA from any statutory or 
regulatory obligation or requirements existing prior to the 
enactment.

          CHANGES IN EXISTING LAW MADE BY THE BILL AS REPORTED

    H.R. 3521 would not make any amendments to existing law.

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (new matter is 
printed in italic and existing law in which no change is 
proposed is shown in roman):

TITLE 38, UNITED STATES CODE

           *       *       *       *       *       *       *



PART VI--ACQUISITION AND DISPOSITION OF PROPERTY

           *       *       *       *       *       *       *


   CHAPTER 81--ACQUISITION AND OPERATION OF HOSPITAL AND DOMICILIARY 
    FACILITIES; PROCUREMENT AND SUPPLY; ENHANCED-USE LEASES OF REAL 
                                PROPERTY


SUBCHAPTER I--ACQUISITION AND OPERATION OF MEDICAL FACILITIES

           *       *       *       *       *       *       *



Sec. 8104. Congressional approval of certain medical facility 
                    acquisitions

  (a) * * *
  (b) Whenever the President or the Secretary submit to the 
Congress a request for the funding of a major medical facility 
project (as defined in subsection (a)(3)(A)) or a major medical 
facility lease (as defined in subsection (a)(3)(B)), the 
Secretary shall submit to each committee, on the same day, a 
prospectus of the proposed medical facility. Any such 
prospectus shall include the following:
          (1) * * *

           *       *       *       *       *       *       *

          (7) In the case of a prospectus proposing funding for 
        a major medical facility lease, a detailed analysis of 
        how the lease is expected to comply with Office of 
        Management and Budget Circular A-11 and section 1341 of 
        title 31 (commonly referred to as the ``Anti-Deficiency 
        Act''). Any such analysis shall include--
                  (A) an analysis of the classification of the 
                lease as a ``lease-purchase'', ``capital 
                lease'', or ``operating lease'' as those terms 
                are defined in Office of Management and Budget 
                Circular A-11;
                  (B) an analysis of the obligation of 
                budgetary resources associated with the lease; 
                and
                  (C) an analysis of the methodology used in 
                determining the asset cost, fair market value, 
                and cancellation costs of the lease.

           *       *       *       *       *       *       *

  (h)(1) Not less than 30 days before entering into a major 
medical facility lease, the Secretary shall submit to the 
Committees on Veterans' Affairs of the Senate and the House of 
Representatives--
          (A) notice of the Secretary's intention to enter into 
        the lease;
          (B) a copy of the proposed lease;
          (C) a description and analysis of any differences 
        between the prospectus submitted pursuant to subsection 
        (b) and the proposed lease; and
          (D) a scoring analysis demonstrating that the 
        proposed lease fully complies with Office of Management 
        and Budget Circular A-11.
  (2) Each committee described in paragraph (1) shall ensure 
that any information submitted to the committee under such 
paragraph is treated by the committee with the same level of 
confidentiality as is required by law of the Secretary and 
subject to the same statutory penalties for unauthorized 
disclosure or use as the Secretary.
  (3) Not more than 30 days after entering into a major medical 
facility lease, the Secretary shall submit to each committee 
described in paragraph (1) a report on any material differences 
between the lease that was entered into and the proposed lease 
described under such paragraph, including how the lease that 
was entered into changes the previously submitted scoring 
analysis described in subparagraph (D) of such paragraph.

           *       *       *       *       *       *       *