A federal investigation shows that the U.S. Department of Veterans Affairs might have overpaid more than $3 million for a controversial site located near a new veteran’s medical center in Louisville, Ky., and violated its own policies about appraising and acquiring the property.
Additionally, a $2,447 review of two appraisals the VA obtained after buying the site was a “waste of the taxpayer’s money” because it came nearly two years after it already purchased the property, the investigation found.
The findings come in a report by the VA’s Office of Inspector General and are likely to renew debate about the 36-acre site proposed to replace the VA’s aging medical center.
Many residents from the area fiercely have opposed the project at the Watterson Expressway because of heavy traffic congestion and questioned the $12.9 million price the VA paid for the vacant tract in 2102.
U.S. Rep. John Yarmuth, who requested the inspector general’s investigation, was quick to point out the where the blame should fall.
“The report makes it clear that the appraisal process was severely flawed, costing taxpayers millions of dollars,” Yarmuth told The Courier-Journal.
Yarmuth said he plans to seek further information from the VA and ensure all regulations are followed going forward on the hospital project.
“We cannot afford to see another dollar or moment wasted when it comes to providing our veterans with the care they need and deserve,” Yarmuth said.
The inspector general’s report focuses on two separate appraisals of the site, both conducted by Galloway Appraisal Co. and appraiser Ronnie Galloway.
In December 2010, Galloway Appraisal valued the vacant site “as is” at $9.8 million, the report said.
But 14 months later, the VA asked for a second appraisal to update the previous one and in February 2012, Galloway Appraisal issued a new finding that the site was worth $12.9 million “as is.”
The VA purchased the site in July 2012 at the higher price without seeking a review of the appraisals, as required by federal regulations to verify the value and assure the appraisals meet federal requirements, the report said.