WASHINGTON — President Donald Trump’s sweeping new infrastructure plan unveiled Monday includes provisions for the Department of Veterans Affairs to keep profits from real estate sales and to more easily trade existing properties to for more favorable leases, moves designed to help better manage the agency’s national footprint.
The plan calls for $200 billion in direct government spending coupled with additional state and local funding to launch wide-ranging infrastructure improvements, encourage private investment in communities and reduce bureaucratic requirements for construction projects.
The proposed VA rule changes fall into that last category, and pair with executive branch efforts to shutter or sell off underused facilities owned by the department.
The department currently manages about 6,300 facilities, and officials have said more than 57 percent of those locations are more than 50 years old. VA Secretary David Shulkin has begun work to close down a few hundred of those obsolete locations but has said additional legislation will be needed to dispose of the others.
Critics said the closing of VA facilities shouldn't move ahead until broader health reform questions surrounding the department are answered.
House Republicans advanced such legislation last fall, but it has remained stalled in the chamber since then.
The president’s infrastructure plan notes that while many of the facilities owned by VA are aging and losing usefulness, “the underlying property values continue to increase.” That money could be rerouted to new construction or leases, if lawmakers were to adopt the changes.
Administration officials argue current rules prohibiting the department from holding onto profits from property sales (instead, the money goes into a broader fund for government agencies) “hinders the VA’s ability to make needed capital improvements” across the states.
Keeping that money in VA, or allowing the department to trade existing properties for cost breaks in new construction projects, would better serve veterans, officials said.
Trump also wants to authorize pilot program for VA officials to trade existing properties for “a lease of space in a resulting private facility built on the former VA land.” The idea would be for VA to downsize their footprint in some areas, keeping a smaller set of revamped offices open alongside new private-sector tenants at a lower cost.
The infrastructure plan also calls for lawmakers to increase the threshold for lease authorizations from Congress. Lawmakers currently must sign off on any lease plan that costs more than $1 million annually. Trump wants that raise to $3.1 million, to reduce red tape in those moves.
The infrastructure plan has come under attack from critics for putting too heavy a burden on state and local governments for the ambitious goals. White House officials have said they expect the $200 billion in federal spending will return $1.5 trillion of actual value to the country, but opponents have called those estimates off-base without heavy costs elsewhere.