Cost estimation requirements for major medical facility leases

Section 8104(b)(2) of such title is amended— (1) by striking Whenever and inserting (A) Whenever; (2) by redesignating subparagraphs (A) through (E) as clauses (i) through (v), respectively; (3) in subparagraph (A), as designated by paragraph (1)— (A) in clause (v), as so redesignated— (i) by redesignating clauses (i) through (iii) as subclauses (I) through (III), respectively; and (ii) by striking the period at the end and inserting; and; and (B) by adding at the end the following new clause: (vi) A market-based cost estimate for the facility to be leased that includes an evaluation of— (I) local land values; (II) applicable construction costs; and (III) other cost factors the Secretary determines relevant to build-to-suit facilities.; and (4) by adding at the end the following new subparagraph: (B) (i) The Secretary shall adopt and apply a standardized methodology for estimating the full life-cycle cost of major medical facility leases and prospectus-level leases. (ii) Such methodology shall include, at a minimum— (I) base rent projections over the full lease term; (II) tenant improvement and buildout costs based on current medical facility standards; (III) estimated operating expenses, including utilities, maintenance, and security; (IV) annual escalation factors tied to construction cost indices, labor rates, and market trends; (V) cost assumptions for option periods or potential renewal terms; and (VI) geographic adjustments using current regional market data to reflect location-specific construction and leasing conditions. (iii) To reflect inflation and market escalation, the Secretary shall annually adjust each cost estimate for a lease submitted to Congress for authorization or prospectus approval during the period beginning on the date on which the Secretary submits the first cost estimate for the lease and ending on the projected award date for the lease. In adjusting a cost estimate pursuant to this subparagraph, the Secretary shall use such medical construction or real estate indices as the Secretary determines appropriate. (iv) If the Secretary does not award a lease during the one year period beginning on the date on which the Secretary completes a cost estimate for the lease pursuant to this paragraph, the Secretary shall update and revalidate such cost estimate prior to obligating any funds for the lease or submitting such cost estimate to Congress..