The mission of VA is to serve America’s veterans and their families with dignity and compassion and to be their principal advocate in ensuring that they receive medical care, benefits, social support, and lasting memorials. VA is a cabinet-level agency with a budget of over $127 billion and is one of the world’s largest health care, medical research, and insurance benefits organizations. In addition to a central office, VA consists of three administrations that generally operate as distinct entities: the Veterans Health Administration (VHA), the Veterans Benefits Administration (VBA), and the National Cemetery Administration (NCA). VHA’s facilities are organized into 21 regional networks, known as VISNs, that are structured to manage and allocate resources to VA health care facilities across the United States. Each VISN is also responsible for coordination and oversight of all administrative and clinical activities within its specified region of the country. We reviewed the status of capital projects in 6 of VA’s 21 VISNs, as shown in figure 1. To provide services to veterans, VA’s current real property portfolio consists of U.S.-owned buildings under VA jurisdiction and control. VA also generally has authority to enter into enhanced-use leases, 3-year outleases, and sharing agreements relating to its real property or space. The assets include, for example, hospitals, clinics, cemeteries, and office buildings where veterans access their many benefits and VA administers its programs. VHA is the largest administration and, in terms of the number of acres owned and square footage, includes the greatest portion of VA’s real property portfolio, as shown in figure 2. In response to our 1999 recommendations for improving agency capital asset planning and budgeting, VA initiated CARES. CARES was the first comprehensive, long-range assessment of VA’s health care capital asset priorities since 1981 and was designed to assess buildings and land ownership under VA’s jurisdiction and control in light of expected demand for VA inpatient and outpatient health care services across a planning horizon through fiscal year 2022. For example, VA recognized that the shift in veterans’ demand for services could be met at community based outpatient clinics that are more geographically accessible to veterans than its hospitals. The CARES process validated gaps in VA’s infrastructure and health care services provided to veterans. The process also included a set of tools for annual capital and strategic planning to enable VA to plan for real property needs to provide quality health care to veterans. Also in response to our 1999 recommendations, VA developed formal 5- year capital plans that are submitted with its annual budget requests to Congress. The 5-year capital plan included in VA’s fiscal year 2011 budget submission document includes the following: capital planning linked to the agency mission, strategic goals, and objectives; baseline assessments and identification of performance gaps—such as underutilized or vacant property and the backlog of repairs needed at its facilities; an alternatives evaluation and resulting risk management plan for these performance gaps; a description of the agency’s planning and approvals process; and a long-term capital plan. Effective planning for capital investments is important for several reasons. First, over time, large amounts of federal funds are spent on capital assets. Second, the performance of capital assets affects how agencies are able to achieve their missions, goals, and objectives to provide service to the public. Finally, capital planning drives budgeting, procurement, and management of an agency’s capital assets. As VA increased its emphasis on outpatient care rather than inpatient care, it was left with an increasingly obsolete infrastructure, including many hospitals built or acquired more than 50 years ago in locations that are sometimes far from where veterans live. This challenge of misaligned infrastructure is not unique to VA. In January 2003, we identified federal real property management as a high-risk area, and VA was cited among those federal agencies that hold a majority of federally owned and leased space. We also reported on VA’s long-standing problems with excess and underutilized property, deteriorating facilities, unreliable real property data, overreliance on costly leasing, and building security challenges. We did this to highlight the need for broad-based transformation in this area, which, if well implemented, will better position federal agencies to achieve mission effectiveness and reduce operating costs. As its newest capital planning effort, VA has initiated SCIP, which will be an agencywide review of VA’s real property priorities and will inform its fiscal year 2012 annual budget submission. According to VA, SCIP will include six key components. Table 1 shows these components and the VA’s planned actions to implement them. SCIP, which VA said builds on its existing capital planning processes, also addresses leading practices. It further strengthens VA’s efforts in some areas and is still evolving and being refined. The SCIP components are linked to VA’s previous capital planning efforts, including CARES and the development of its 5-year capital plan. Figure 3 illustrates VA’s capital planning steps from 1999 to 2010. As a part of its shift from hospital based, inpatient care to outpatient care, VA has made changes to its real property portfolio on the basis of its May 2004 CARES Decision document and subsequent capital planning. As for specific CARES Decision projects, VA reported in its April 2010 Implementation Monitoring Report on Capital Asset Realignment for Enhanced Services that it has completed 13 of 59 planned major and minor construction projects, opened 82 of 156 planned community-based outpatient clinics (CBOC), and has another 19 ongoing major construction projects identified in the CARES Decision. As for net changes to VA’s real property portfolio since the CARES Decision, our analysis of the data in VA’s 5-year capital plans from 2004 to 2009 found that leases and leased space had increased due in part to VA’s efforts to realign its portfolio towards more outpatient facilities, such as CBOCs and vet centers. These centers provide readjustment counseling and outreach services to all veterans and family members dealing with military-related issues. Although U.S.-owned buildings and vacant space under VA’s jurisdiction and control show a decrease because of VA’s disposal of assets, VA shows a net increase as a result of new construction projects. Similarly, the net increase in owned acreage can be attributed to property acquired by VA’s National Cemetery Administration for new cemeteries. These results of VA’s agencywide capital planning efforts since its March 2004 CARES Decision are shown in table 2. Our analysis also showed that, with the exception of hospitals, VA has expanded the number and types of buildings by which it delivers services. Table 3 shows VA’s changes to its real property portfolio in terms of facility types. VA officials and stakeholders generally agreed that changes to the VA real property portfolio have benefited veterans. For example, both groups reported that the new facilities, such as more accessible clinics, had improved veteran access to services by limiting the distance that veterans travel to VA health care facilities. Officials from veteran service organizations with whom we spoke stated that upgrades to VA’s real property portfolio had improved care for veterans. For example, these officials commented that real property changes in VA facilities in Denver, Colorado, and Syracuse, New York, have resulted in improved services for veterans with spinal cord injuries or diseases. Additionally, officials from VA’s central office and the VISNs that we contacted cited recent initiatives, such as telehealth and telemental health services at CBOCs, as being beneficial to veterans. To gain further insight on the steps that VA took to realign its real property portfolio, we observed ongoing and completed projects at 5 VISNs that demonstrated VA’s changes in the areas that CARES identified as priorities: improved access, modernization, special disability programs, underutilized or vacant property, CBOCs, VA and the Department of Defense (DOD) collaboration, long-term care, and mental health. As such, we visited several facilities in those VISNs as described in figures 4 through 9. VA has been appropriated about $16.7 billion from fiscal years 2004 through 2010 for major construction, minor construction, and nonrecurring maintenance. In addition, VA has identified several other high-cost projects that have not yet been funded. For example, VA reported in its 5-year capital plan for fiscal years 2010-2015 that agencywide, it has a backlog of $9.4 billion of facility condition assessment deficiencies (repairs). Furthermore, due to incremental funding of projects, 24 of the 69 ongoing major construction projects listed in the plan needed an additional $4.4 billion to complete. For example, the plan describes funding needed for the new medical facility in Denver. As of fiscal year 2010, VA has been funded only $307 million of the estimated $800 million total project cost. The President’s budget for fiscal year 2011 included a request for $451 million for this project. Even if this amount is funded, VA’s 5-year capital plan reports that this project would still need an additional $42 million to complete construction. VA officials commented that this phased approach enables the agency to request funding in stages that allow for the funding of independent and stand alone portions of projects to be built while allowing available resources to be utilized on other high-priority projects. Like other agencies across the government, VA has faced underlying obstacles that have exacerbated its real property management challenges and caused them to persist over time. Specifically, we have previously reported on such challenges, including competing stakeholder interests, legal and budgetary limitations, and the need for improved capital planning. These challenges can impact the agency’s ability to fully realign its real property portfolio. Regarding competing stakeholder interests, we have reported that VA has faced challenges in coordinating with historic preservation and community organizations, as well as managing established relationships with other health care providers, such as college and university partnerships. While joint ventures for facilities present unique opportunities for VA to explore new ways to provide health care to veterans, it also raises issues for VA. These issues include the benefits and costs of investing in a joint facility compared with those of other alternatives, such as maintaining the existing facility or considering options with other health care providers in the area; legal matters associated with the new facility, such as leasing or transferring property, contracting, and employment; and potential concerns of stakeholders. We have also identified legal and budgetary issues that can hamper agencies’ efforts to address their excess and underutilized real property problems. For example, federal agencies must assess and may be required by law to pay for any environmental cleanup that may be needed before disposing of a property—a process that may require years of study and result in significant costs. Regarding VA, we have reported that some VA managers have retained excess property because the administrative complexity and costs of complying with these requirements were disincentives to disposal. For example, we previously reported that VA stated that except for enhanced-use leases, restrictions on retaining proceeds relating to VA controlled properties are a disincentive for VA to dispose of property. VA officials estimated that the average time it takes to implement an enhanced-use lease can range from 9 months to 2 years. VA can also dispose of underutilized and vacant property to other federal agencies and for programs for the homeless under the McKinney-Vento Act. However, VA officials stated that the process can average 2 years and that the agency may not receive compensation from such agreements entered into under this act. Over the years, we have reported that (1) prudent capital planning can help agencies make the most of limited resources and (2) timely and effective capital acquisitions can result in economical acquisitions that are on budget, on schedule, and in line with mission needs and goals. Both OMB and GAO guidance emphasize the importance of developing a long-term capital investment plan to guide the implementation of organizational goals and objectives and to help decision makers establish priorities over time. Capital planning is an especially important area for VA, given the agency’s efforts to effect a large-scale transformation of its real property portfolio and the substantial capital investment these efforts will require. Congress, OMB, and GAO have identified the need for effective capital planning. In addition, budgetary constraints and demands to improve performance in all areas have put pressure on agencies to make sound capital acquisition proposals. In the overall capital programming process, planning is the first phase—and, arguably, the most important—since it drives the remaining phases of budgeting, procurement, and management. OMB has issued various guidance and requirements for agencies to follow and use in developing disciplined capital programming processes, including the 1997 Capital Programming Guide, to provide agencies with a basic reference for establishing an effective process for making investment decisions. In 1998, GAO issued its Executive Guide on the basis of a study of leading state and local government and private-sector capital investment practices. Our guide (1) summarizes fundamental practices that have been successfully implemented by organizations that are recognized for their outstanding capital decision-making practices and (2) provides examples of leading practices from which the federal government may draw lessons and ideas. Although our guide focuses on fundamental practices, rather than detailed guidance, the practices represent actions and steps to be taken. In addition, the examples presented in our guide illustrate and complement many of the phases and specific steps contained in OMB’s guide. There is a great deal of overlap in the OMB and GAO guides since both suggest similar fundamental practices that are essential to making effective capital investment decisions. Because of the importance of planning, we focused on VA’s implementation of the concepts that underlie the planning phase of OMB’s guide and planning practices in our guide (see fig.10). OMB and our guidance stress the importance of linking capital asset investments to an organization’s overall mission and long-term strategic goals. The guidance also emphasizes evaluating a full range of alternatives to bridge any identified performance gap, informed by agency asset inventories that contain condition information. Furthermore, the guidance calls for a comprehensive decision-making framework to review, rank, and select from among competing project proposals. Such a framework should include the appropriate levels of management review, and selections should be based on the use of established criteria. The ultimate product of the planning phase is a comprehensive capital plan, which defines the long-term capital decisions that resulted from the agency’s capital planning process. Both OMB and our guidance highlight the importance of this plan. The planning phase is the crux of the capital decision-making process and the products that result from this phase are used throughout the remaining phases of the process. We found that VA’s 5-year capital plan and SCIP reflect several of the leading capital planning practices that we have previously discussed. For example, VA’s 5-year capital plan is updated annually as part of its annual budget submission to Congress and contains lists of projects, by administration, for the next 5 years. SCIP is an update to VA’s capital planning process that builds on existing processes, including the principles and tools of CARES, and was used to inform VA’s annual budget submission to Congress for fiscal year 2012. Figure 11 presents examples of how VA’s planning efforts reflect leading practices. We compared VA’s 5-year capital plan with the leading practices. In the area of strategic linkage, we found that VA’s efforts reflect leading practices by identifying projects that received the highest priority ranking using criteria that reflect the goals and mission contained in VA’s Strategic Plan. For example, one of the criteria by which potential capital projects were prioritized was “Departmental Alignment,” which includes the Secretary’s goals for improving management and performance and VA’s strategic goals. In regard to assessing needs and identifying gaps, in 2004 we reported that VA neither had an agencywide inventory of existing capital assets nor agencywide information about the condition of those assets, but VA has since developed a capital asset database. VA officials said they recently completed facility condition assessments for all of its owned buildings and are considering whether to assess the condition of their leased buildings, many of which VA is not responsible for maintaining. VA uses facility condition assessments as one factor in guiding capital investment decisions to improve the condition of its most deteriorated buildings. VA’s 5-year capital plan also includes steps to evaluate various alternatives for addressing real property priorities by requiring that four alternative approaches be considered to bridge any capital need—leasing; status quo; new construction; and rehabilitation, repair, or expansion of existing facilities. In the area of establishing a review and approval framework for VA’s capital investment decisions, VA has a panel chaired by a department- wide group of senior VA management to assess capital investment proposals; evaluate, score, and prioritize proposals by VA administration; and make recommendations through the VA governance process to the Secretary of VA. VA’s 5-year plan uses established criteria by which potential capital projects are evaluated, such as criteria that reflect VA’s goal of increasing veterans’ access to health care and supporting services for veterans suffering from spinal cord injury, traumatic brain injury, and post-traumatic stress disorder. Finally, in 2004 we reported that VA did not have a long-term capital plan that identified agencywide real property priorities. However, VA has since developed a 5-year capital plan, updated annually, which is used to inform the agency’s annual budget submission. It describes VA’s capital planning process and gives brief descriptions of capital investment projects included in its budget submission. VA also modified its capital planning efforts in 2010 by developing a new process, called SCIP, which was used to inform its fiscal year 2012 budget submission to Congress. VA officials told us that SCIP builds on its existing capital planning processes, addresses leading practices, and further strengthens VA’s efforts in some areas. Under SCIP, VA will continue to link its investments with its strategic goals, assess the agency’s real property priorities, evaluate various alternatives, and use a similar review and approval framework when making capital investment decisions. In addition, SCIP also strengthens VA’s capital planning in some areas. Specifically, SCIP extends the horizon of its 5-year capital plan to 10 years, providing VA with a longer range picture of the agency’s future real property priorities. As a result of SCIP, VA officials told us that the agency developed cost estimates for all of its major and minor construction projects, leases, and nonrecurring maintenance projects for the next 10 years. SCIP is also centralizing VA’s process for ranking and selecting capital investments on the basis of established criteria. For example, in the past, VA would develop a list of prioritized projects for each of its administrations, such as VBA, NCA, and VHA, for projects less than $10 million dollars. However, VA is now prioritizing projects from an agencywide perspective across all of its administrations and developing one list to guide its capital planning decisions. VA has also drafted a set of weighted criteria by which it plans to evaluate projects. The criteria listed below assess whether capital investments improve the safety and security of VA facilities by mitigating potential damage to buildings facing the risk of a seismic event, improving compliance with safety and security laws and regulations, and ensuring that VA can provide service in the wake of a catastrophic event; address selected key major initiatives and supporting initiatives identified in VA’s strategic plan; address existing deficiencies in its facilities that negatively impact the delivery of services and benefits to veterans; reduce the time and distance a veteran has to travel to receive services and benefits, increase the number of veterans utilizing VA’s services, and improve the services provided; right-size VA’s inventory by building new space, converting underutilized space, or reducing excess space; and ensure cost-effectiveness and the reduction of operating costs for new capital investments. VA officials said that SCIP is still evolving and being refined. For example, VA officials said that the agency completed a series of “lessons learned” sessions to determine how the process can be improved and to make changes, if needed, for the 2013 budget cycle. Despite the positive aspects of VA’s capital planning efforts, VA’s resulting 5-year capital plan that it provides yearly to Congress lacks transparency about the cost of future priorities beyond the current budget year. For projects VA proposes to initiate in the current budget year, VA’s 5-year capital plan includes current year estimates for cost of construction, equipment, and operating costs for major and minor construction projects, such as new and replacement medical facilities. It also provides estimates to complete these and other ongoing projects in future years. However, the plan identifies other potential projects, not beginning in the current budget year, for which it lists project name but contains no information on what these projects might cost or the priority, as VA has not assigned one to them. For example, VA’s most recent capital plan, submitted with its 2011 budget request, lists potential projects—including 100 major construction and 1,062 minor construction projects—for which pricing estimates are not provided. We have previously reported that capital planning should result in a long- term capital plan with prioritized projects and justification of capital requests, such as project resource estimates and costs. The cost estimates of prioritized projects can then be incorporated into an agency’s annual budget request to Congress. The yearly request reflects the agency’s policy decisions regarding what it has determined, in consultation with OMB, should be funded. VA officials told us that it has been VA’s policy to not include multiyear pricing information for projects in their current 5-year capital plan and budget submission to Congress. VA’s SCIP, according to VA officials and VA documents we reviewed, will identify costs for future projects and information about their relative priority within their organization. VA commented that the future priority of unfunded projects cannot be provided as these projects are reprioritized each year using updated weights and decision criteria. Further, during our review, VA officials told us they are considering the release of future year capital cost estimates to Congress. A decision on the release of this information is expected to be reflected in the fiscal year 2012 budget and SCIP plan to be released in February 2011. VA officials added that pricing information is viewed as an internal tool for prioritizing projects and preparing budget requests and that project cost estimates become more reliable as the projects move closer to the year of construction. While we agree that cost estimates beyond the current year are less reliable, this could be made clear to decision makers, and as the projects move closer to the year of implementation, the estimates can be refined. VA officials told us that the agency already maintains future year estimates internally. While VA may view this information as suitable only for internal use, decision makers in Congress would benefit from having it for several reasons. Specifically, transparency about future priorities allows decision makers to weigh current year budget decisions in context with the magnitude of future costs. In the case of VA, which has identified a significant number of future projects in the tens of billions of dollars, full transparency regarding these future priorities may spur discussion and debate about actions Congress can take to address them. This could include not only appropriations, but also programmatic changes and real property management tools that could help VA to leverage its real property to more efficiently and effectively meet the future needs of veterans. Additionally, transparency regarding future capital costs puts VA’s priorities in context with the overall fiscal condition of the U.S. government. There is widespread agreement that the federal government faces formidable near- and long-term fiscal challenges. GAO has long stated that increased information and better incentives for budget decisions involving both existing and proposed programs that require significant future resources could facilitate consideration of competing demands and help put our finances on a more sustainable footing. And lastly, one of VA’s key stakeholders, the Senate Appropriations Committee, recently asked VA for more information on its future capital project costs. The committee is aware of VA’s SCIP process and requested that the department submit with its fiscal year 2012 budget request, all findings associated with this review. At the time of our review, VA had not determined how it would respond to this request. Providing cost estimates for future projects to Congress for capital programs is not without precedent in the federal government. For example, in 1987, Congress directed the Department of Defense to submit a 5-year defense program (referred to as the future years defense program,(FYDP)) used by the Secretary of Defense in formulating the estimated expenditures and proposed appropriations included in the President’s annual budget to support DOD programs, projects, and activities. The FYDP provides DOD and Congress with a tool for looking at future funding needs beyond immediate budget priorities and can be considered a long-term capital plan. As another example, the judiciary recognized that it was facing space shortages, security shortfalls, and operational inefficiencies at courthouse facilities around the country. In March 1996, the judiciary issued a 5-year plan for courthouse construction, which was intended to communicate the judiciary’s urgent housing needs to Congress and the General Services Administration, and identified 45 projects for funding on the basis of information from Congress and GSA that $500 million could be used as a planning target in estimating funds that will be available for courthouse construction each year. The judiciary also developed a methodology, including criteria and weights, for assigning urgency scores to projects. As another example, we reported earlier this year that House and Senate appropriators have voiced interest in having the Army Corps of Engineers include additional information in the agency’s budget presentation. We found that an information gap is created when an administration highlights its priority projects, but does not provide sufficient information on other future resource needs. Congressional users of the Corps’ budget presentation told us that not having information on future resource needs limits the ability of Congress to make fully informed decisions when making appropriations decisions. Further, such information would increase the usefulness and transparency of the budget presentation. VA has an important mission in serving veterans, and its real property portfolio is critical to ensuring that veterans have access to benefits and services. Billions of dollars have already been appropriated to VA to realign and modernize its portfolio. Further, VA has identified ongoing and future projects that could potentially require several additional billion dollars over the next few years to complete. Given the fiscal environment, VA and Congress would benefit from a more transparent view of potential projects and their estimated costs than VA currently provides. Such a view would enable VA and Congress to better evaluate the full range of real property priorities over the next few years and, should fiscal constraints so dictate, identify which might take precedence over the others. In short, more transparency would allow for more informed decision making among competing priorities, and the potential for improved service to veterans over the long term would likely be enhanced. To enhance transparency and allow for more informed decision making related to VA’s real property priorities, we recommend that the Secretary of Veterans Affairs provide the full results of VA’s SCIP process and any subsequent capital planning efforts, including details on the estimated cost of all future projects, to Congress on a yearly basis. We provided a draft of this report to VA for their review and comment. VA generally agreed with our conclusions and concurred with our recommendation. VA also provided technical corrections and clarifications, which we incorporated as appropriate. See appendix II for VA’s comments. As agreed with your offices, unless you publicly announce the contents of this report earlier, we plan no further distribution until 30 days from the report date. At that time, we will send copies of this report to the appropriate congressional committees, to the Secretary of Veterans’ Affairs, and other interested parties. The report also will be available at no charge on the GAO Web site at http://www.gao.gov. If you or your staff members have any questions about this report, please contact me at (202) 512-2834 or stjamesl@gao.gov. Contact points for our Offices of Congressional Relations and Public Affairs may be found on the last page of this report. GAO staff who made major contributions to this report are listed in appendix III. We addressed the following objectives: (1) To what extent have the Department of Veterans Affairs’ (VA) capital planning efforts resulted in changes to its real property portfolio and what priorities remain? and (2) To what extent do VA’s capital planning efforts follow leading practices and provide the information needed for informed decision making? To determine the extent to which VA’s capital planning efforts, including the Capital Asset Realignment for Enhanced Services (CARES), have resulted in changes to its real property portfolio and to identify the agency’s remaining priorities, we interviewed VA officials located in the central office in Washington, D.C., and 6 Veterans Integrated Service Networks (VISN) and observed VA facilities in 5 of these 6 VISNs. (See table 4 for a list of VA departments, VISNs interviewed and projects observed.) Based on the number of veterans served annually, we selected 2 large, medium, and small VISNs each, out of a total of 21. To further guide our selections, we also considered a number of other factors, including the number of completed and ongoing projects, new medical facilities, and geographic dispersion. Within each VISN, we selected projects in various stages, CARES projects being monitored by VA according to seven centrally tracked implementation measures, and sites throughout the geographic footprint of each selected VISN. We also interviewed senior officials at 5 veterans service organizations chartered by Congress or recognized by VA for claim representation. (See table 5 for a list of the veterans service organizations that we interviewed.) We also reviewed agency data in VA’s CARES Decision, its Implementation Monitoring Report on Capital Asset Realignment for Enhanced Services, and its 5-year capital plan about changes to its real property portfolio and the number and cost of projects needing additional funding. In addition, we reviewed the funding that VA has received for major and minor construction projects and nonrecurring maintenance since fiscal year 2004 in VA budget submission documentation, its 5-year capital plans, and appropriation laws. We assessed the funding and facilities data from the VA and determined it was reliable for our purposes. To determine the extent to which VA’s capital planning efforts follow leading practices and provide the information needed for informed decision making, we interviewed VA officials involved in its capital planning efforts. We also collected information on leading capital planning practices from the Office of Management and Budget’s Capital Programming Guide and GAO’s Executive Guide, and compared it with VA’s efforts as described in the agency 5-year capital plan. In addition, we collected information and interviewed officials on VA’s new capital planning process, called SCIP, and compared it to leading capital planning practices. To compare VA’s efforts with the efforts of other federal agencies that have provided estimates to Congress regarding the magnitude of future real property priorities, we reviewed our previous reports on capital planning across the federal government, including the Department of Defense’s future years defense program and efforts by the judiciary in March 1996 to communicate its urgent housing needs to Congress. Finally, we collected VA data on the agency’s future real property priorities and reviewed a recent request by Congress to VA to develop and submit a comprehensive capital plan, along with other information related to VA’s capital planning efforts. In addition to the individual named above, David Sausville, Assistant Director; Daniel Cain; George Depaoli; Colin Fallon; Wati Kadzai; and Erica Miles made key contributions to this report.

Summary: The Department of Veterans Affairs (VA) has undertaken various planning efforts to realign its real property portfolio, including the Capital Asset Realignment for Enhanced Services (CARES), creation of a 5-year capital plan, and its newest effort, the Strategic Capital Investment Planning process (SCIP). Through these efforts, VA has identified numerous real property priorities it believes should be completed if the agency's facilities are to meet veterans' needs for services now and in the future. This congressionally requested report addresses the extent to which VA's capital planning efforts (1) have resulted in changes to its real property portfolio and (2) follow leading practices and provide information for informed decision making. To perform this work, GAO reviewed leading capital planning practices and data on VA's real property portfolio and future priorities. GAO also interviewed VA officials and veterans service organizations, and visited sites in 5 of VA's 21 veterans integrated service networks. Through its capital planning efforts, VA has taken steps to realign its real property portfolio from hospital based, inpatient care to outpatient care, but a substantial number of costly projects and other long-standing challenges also remain. Several of VA's most recent capital projects--such as community based outpatient clinics, rehabilitation centers for blind veterans and spinal cord injury center--were based on its CARES efforts and subsequent capital planning. VA officials and veterans service organizations GAO contacted agreed that these facilities have had a positive effect on veterans' access to services. However, VA has identified several high-cost priorities such as facility repairs and projects that have not yet been funded. For example, VA reported in its 5-year capital plan for fiscal years 2010-2015 that it had a backlog of $9.4 billion of facility repairs. The 5-year plan further identified an additional $4.4 billion in funding to complete 24 of the 69 ongoing major construction projects. Besides substantial funding priorities, VA, like other agencies, has faced underlying obstacles that have exacerbated its real property management challenges and can also impact its ability to fully realign its real property portfolio. GAO has previously reported that such challenges include competing stakeholder interests, legal and budgetary limitations, and capital planning processes that did not always adequately address such issues as excess and underutilized property. VA's capital planning efforts generally reflect leading practices, but lack transparency about the cost of future priorities that could better inform decision making. For example, GAO found that VA's 5-year capital plan links its investments with its strategic goals, assesses the agency's capital priorities, and evaluates various alternatives. Also, SCIP strengthens VA's capital planning efforts by extending the horizon of its 5-year plan to 10 years, and providing VA with a longer range picture of the agency's future real property priorities. While these are positive steps, VA's planning efforts lack transparency regarding the magnitude of costs of the agency's future real property priorities, which may limit the ability of VA and Congress to make informed funding decisions among competing priorities. For instance, for potential future projects, VA's 5-year capital plan only lists project name and contains no information on what these projects are estimated to cost or the priority VA has assigned to them beyond the current budget year. VA officials said during the review that they are considering the release of future year capital cost estimates to Congress. Transparency about future requirements would benefit congressional decision makers by putting individual project decisions in a long-term, strategic context, and placing VA's fiscal situation within the context of the overall fiscal condition of the U.S. government. Providing future cost estimates to Congress for urgent, major capital programs is not without precedent in the federal government. Other federal agencies, such as the Department of Defense, have provided more transparent estimates to Congress regarding the magnitude of its future capital priorities beyond immediate budget priorities. GAO recommends that VA annually provide to Congress the full results of its SCIP process and any subsequent capital planning efforts, including details on estimated cost of future projects. VA concurred with this recommendation.