[Senate Hearing 110-1242]
[From the U.S. Government Publishing Office]







                                                       S. Hrg. 110-1242

  EXAMINING THE PRESIDENT'S PROPOSED FISCAL YEAR 2009 BUDGET FOR THE 
      CIVIL WORKS PROGRAMS OF THE U.S. CORPS OF ENGINEERS AND THE 
   IMPLEMENTATION THE WATER RESOURCES DEVELOPMENT ACT (WRDA) OF 2007

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

                                HEARING

                               before the

               COMMITTEE ON ENVIRONMENT AND PUBLIC WORKS
                          UNITED STATES SENATE

                       ONE HUNDRED TENTH CONGRESS

                             SECOND SESSION

                               __________

                             MARCH 11, 2008

                               __________

  Printed for the use of the Committee on Environment and Public Works






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               COMMITTEE ON ENVIRONMENT AND PUBLIC WORKS

                       ONE HUNDRED TENTH CONGRESS
                             FIRST SESSION

                  BARBARA BOXER, California, Chairman
MAX BAUCUS, Montana                  JAMES M. INHOFE, Oklahoma
JOSEPH I. LIEBERMAN, Connecticut     JOHN W. WARNER, Virginia
THOMAS R. CARPER, Delaware           GEORGE V. VOINOVICH, Ohio
HILLARY RODHAM CLINTON, New York     JOHNNY ISAKSON, Georgia
FRANK R. LAUTENBERG, New Jersey      DAVID VITTER, Louisiana
BENJAMIN L. CARDIN, Maryland         JOHN BARRASSO, Wyoming
BERNARD SANDERS, Vermont             LARRY E. CRAIG, Idaho
AMY KLOBUCHAR, Minnesota             LAMAR ALEXANDER, Tennessee
SHELDON WHITEHOUSE, Rhode Island     CHRISTOPHER S. BOND, Missouri

       Bettina Poirier, Majority Staff Director and Chief Counsel
                Andrew Wheeler, Minority Staff Director




















                            C O N T E N T S

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                                                                   Page

                             MARCH 11, 2008
                           OPENING STATEMENTS

Boxer, Hon. Barbara, U.S. Senator from the State of California...     1
Isakson, Hon. Johnny, U.S. Senator from the State of Georgia.....     2
Craig, Hon. Larry E., U.S. Senator from the State of Idaho.......     4
Klobuchar, Hon. Amy, U.S. Senator from the State of Minnesota....     5
Alaxander, Hon. Lamar, U.S. Senator from the State of Tennessee..     6
Vitter, Hon. David, U.S. Senator from the State of Louisiana.....     7
Bond, Hon. Christopher, U.S. Senator from the State of Missouri..     8
Barrasso, Hon. John, U.S. Senator from the State of Wyoming......     9
Voinovich, Hon. George, U.S. Senator from the State of Ohio......    10
Cardin, Hon. Benjamin L., U.S. Senator from the State of Maryland    76
Inhofe, Hon. James M., U.S. Senator from the State of Oklahoma, 
  prepared statement.............................................    87
Lieberman, Hon. Joseph, U.S. Senator from the State of 
  Connecticut, prepared statement................................    88
Warner, Hon. John, U.S. Senator from the State of Virginia, 
  prepared statement.............................................    89

                               WITNESSES

Woodley, Hon. John Paul Jr., Assistant Secretary of the Army.....    12
    Prepared statement...........................................    14
    Response to an additional question from Senator Bond.........    26
    Responses to additional questions from:
        Senator Boxer............................................    26
        Senator Inhofe...........................................    32
        Senator Carper...........................................    33
Antwerp, Lieutenant General Robert Van, Chief of Engineers, U.S. 
  Army Corps of Engineers........................................    39
    Prepared statement...........................................    39
    Response to an additional question from Senator Warner.......    43
    Responses to additional questions from Senator:
        Senator Inhofe...........................................    43
        Senator Voinovich........................................    43
        Senator Vitter...........................................    66
        Senator Lieberman........................................    69

 
  EXAMINING THE PRESIDENT'S PROPOSED FISCAL YEAR 2009 BUDGET FOR THE 
      CIVIL WORKS PROGRAMS OF THE U.S. CORPS OF ENGINEERS AND THE 
   IMPLEMENTATION THE WATER RESOURCES DEVELOPMENT ACT (WRDA) OF 2007

                              ----------                              


                        TUESDAY, MARCH 11, 2008

                                       U.S. Senate,
                 Committee on Environment and Public Works,
                                                    Washington, DC.
    The full committee met, pursuant to notice, at 10 a.m. in 
room 406, Dirksen Senate Office Building, Hon. Barbara Boxer 
(chairman of the full committee) presiding.
    Present: Senators Boxer, Cardin, Klobuchar, Voinovich, 
Isakson, Vitter, Craig, Alexander, Bond, Barrasso

           OPENING STATEMENT OF HON. BARBARA BOXER, 
           U. S. SENATOR FROM THE STATE OF CALIFORNIA

    Senator Boxer. Good morning, everybody. We will call this 
hearing to order.
    I am going to put my full statement into the record and we 
will give everybody 3 minutes for an opening statement.
    Today the Committee meets to conduct oversight of the 
Corps' implementation of WRDA 2007. We will also review the 
2009 budget of the Civil Works program and we are examining 
these issues together because it is the annual budget request 
that truly demonstrates the priorities of the Administration. 
And of course, in this case, the priorities of this Committee, 
which in most part has been very bipartisan when it has come to 
issues such as WRDA.
    For me, I ask the question, are we committed to protecting 
lives, to enhancing the environment? Are we committed to 
growing the economy? As I look at this budget, it falls short, 
for me.
    Last year, I was pleased to join with Senator Inhofe, the 
Ranking Member of the Committee, and all the members of this 
Committee, to lead the floor fight to overturn the veto of WRDA 
2007. By a vote of 79 to 14, the Senate overwhelmingly told the 
President that there was more than one branch of Government in 
the Nation and that shoring up America's water infrastructure 
was long overdue and must be a priority.
    Secretary Woodley and Chief Van Antwerp, welcome to both of 
you, and thank you for appearing before the Committee today. I 
work closely with both of you and I have great respect for both 
of you. Your job is a tough one and very important one for the 
Nation. Your agency provides communities with flood protection. 
You restore ecosystems, such as the once vast wetlands of 
America. You do help grow the economy through more efficient 
navigation.
    My home State of California has some of the Nation's most 
critical needs. Indeed, my State's capital, Sacramento, as you 
all well know, is four times as likely to see catastrophic 
flooding as New Orleans was in 2005. I am very pleased to see 
that the Sacramento area flood control was not ignored in this 
budget. I also appreciate that the budget includes more than $5 
billion to complete the repair of levees in New Orleans. These 
emergency funds are an important step to rebuilding New Orleans 
and the Gulf Coast, but they certainly can't be the last step.
    I will never forget the visit we made to New Orleans, many 
of us here on this Committee. I just think we must shore up our 
Nation's water and flood control infrastructure before 
catastrophe strikes, not after. And the President's budget 
request for civil works program is $4.741 billion, this is a 
decrease, a decrease of $851 million from the Fiscal Year 2008 
enacted level of $5.592 billion. So it is shocking to me the 
proposed 2009 budget includes a 36 percent cut in construction 
for flood control projects authorized by Congress. I just don't 
see how we could go this way.
    So I will put the rest of my statement into the record, 
because I have so many questions, I want to leave time for my 
other colleagues and their questions as well. I will call on 
Senator Isakson.

           OPENING STATEMENT OF HON. JOHNNY ISAKSON, 
             U.S. SENATOR FROM THE STATE OF GEORGIA

    Senator Isakson. Thank you, Madam Chairman. General Van 
Antwerp, welcome today, Secretary Woodley, glad to have you.
    Two points I would like to make. No. 1, I was very 
disappointed that the Savannah River project money was not 
included in the 2009 budget. I had significant conversations 
both with Mr. Nussle at the White House as well as the Corps, 
and had hoped that would make it.
    As you know, the 1999 WRDA Act authorized the deepening of 
the Savannah Channel, subject to environmental studies, from 42 
to 48 feet. As you probably also are aware, the Port of 
Savannah is now the second largest port on the eastern seaboard 
of the United States in terms of tonnage. The State of Georgia 
had pledged $50 million a year to match the $78 million that we 
had asked for from the Feds.
    Timing is of the essence in this. The Panama Canal 
expansion and the new PanaMex ships will be coming through, I 
believe in 2014 is the date I remember. It is going to be 
essential to maintain our competition with those types of ships 
coming through, that the Port of Savannah be able to have that 
channel widening and deepening. So I would appreciate hearing 
from you in your remarks about that particular subject.
    Equally important to our State, obviously, has been what is 
termed by many the water wars between Georgia, Tennessee and 
Alabama. But in fact, it is not really a war as much as it is a 
complex problem that must be dealt with. I am very appreciative 
that Secretary General of the Corps made the announcement that 
they would begin the work on the water control manuals for the 
ACF and the ACT. We are operating one of the largest 
metropolitan areas in the United States of America and the 
waterway that serves it based on water control manuals that are 
over 20 years old. It is impossible to be able to do that, so I 
am very happy to hear that both the ACF and the ATC manuals are 
in place. I am hoping you will be able to confirm for me that 
the funding in this budget is sufficient for you to carry out 
the completion of those two projects.
    I know that Secretary of the Interior Kempthorne is very 
supportive. As you know, he recently wrote to the Governors of 
Georgia, Florida and Alabama that he is going to take over 
implementing the operation of that watershed, since the 
Governors were unable to reach a final agreement. In the end, I 
hope the Governors will, but I commend Secretary Kempthorne for 
what he is doing. I commend the Corps for its commitment of the 
water control manuals, and I hope this hearing will get us a 
confirmation that the money is in fact included to ensure that 
will go forward without abatement and we will be able to 
complete it hopefully within the next 2 years.
    Thank you, Madam Chairman.
    [The prepared statement of Senator Isakson follows:]

          Statement of Hon. Johnny Isakson, U.S. Senator from 
                          The State of Georgia

    Thank you Madam Chairman. These types of hearings are a 
good opportunity for us to learn about the Army Corps' 
priorities, and about what we can do as partners with the Corps 
to ensure it meets its goals in a fiscally responsible manner. 
We require the Corps to do a number of things in the best 
interests of our Nation, and I have a number of issues I am 
eager to hear from the Corps on. I am interested in hearing 
whether they believe their fiscal year budget request, a 
decrease from fiscal year levels, provides adequate funding for 
civil works projects. To be candid, I do not believe it does. I 
am also interested in hearing in what the Corps is doing to 
reduce its backlog of projects, as well as to improve its 
business practices.
    On the local level, I am very disappointed that the Corps 
failed to realize the strategic importance of the Savannah 
Harbor Expansion Project (SHEP). This is a project that has 
been under review by the U.S. Army Corps of Engineers (USACE) 
in various stages for a decade, and was authorized in the Water 
Resources and Development Act of 1999 (WRDA 1999) to deepen the 
channel from 42 to as much as 48 feet, subject to completion of 
environmental and cost benefit studies.
    These studies are nearing completion, and I anticipate that 
they will show an extraordinary combination of high benefits 
versus costs. I also believe that they will reflect the most 
transparent, rigorous, and accurate compilation of 
environmental and economic analysis of any river and harbor 
project in the Nation.
    Since the initial authorization in WRDA, the Port of 
Savannah has become the fastest growing container port in the 
United States, and is now the second largest container port on 
the East Coast. Cargo volume has more than doubled in the past 
10 years, Savannah is now responsible for moving more than 16 
percent of the East Coast's overseas container cargo, and both 
the State of Georgia and private companies have invested 
hundreds of millions of dollars in land-side facilities to 
increase efficiency. However, the ability of the port to 
continue to expand and accommodate the economic growth of 
business activity throughout the East Coast and Midwest will be 
dramatically weakened if the port cannot be expanded to 
accommodate the larger ``Panamax'' vessels that will shortly 
dominate ocean commerce.
    It was vital for this effort that the President's budget 
request for fiscal year included sufficient funds to begin the 
first year of the estimated 4 years of construction required 
for the project. Release of the funds would have been subject 
to completion of the required environmental resource and 
administrative approvals. Senior officials of the Corps, from 
the Assistant Secretary of the Army for Civil Works on down, 
assured me this project would be included. I am looking for 
answers from the witnesses as to their views of this project's 
strategic importance, as well as why it was not included when 
all indications were that it would be.
    As many of you know, for 17 years now the States of 
Georgia, Alabama, and Florida, have been negotiating over how 
to share the resources of water in the Alabama-Coosa-Tallapoosa 
(ACT) and Apalachicola-Chattahoochee-Flint (ACF) river basins. 
Late last year, the Governors of the three states as well as 
the Interior Secretary and the Army Corps of Engineers sat down 
to continue their talks over how to resolve the 17-year-old 
water dispute. The Governors emerged from the meeting saying 
they were hopeful they will reach an agreement by March.
    On March 2, Secretary of the Interior Dirk Kempthorne and 
Council on Environmental Quality Chairman Jim Connaughton sent 
a letter to the Governors of Alabama, Georgia and Florida. 
While acknowledging that more progress has been made over the 
last few months than in the previous 18 years, Secretary 
Kempthorne and Chairman Connaughton said the Governors have 
been unable to cross the finish line with an agreement.
    In the letter, Secretary Kempthorne and Chairman 
Connaughton told the Governors that the Federal Government will 
now begin a process to review interim operations that will 
replace the current program before it expires on June 1, 2008. 
Federal agencies may subsequently issue further revisions as 
may be warranted by Federal law, changing hydrological 
conditions and new information. Any future changes in interim 
operations will be necessary only until the water control plans 
and manuals are revised.
    Secretary Kempthorne and Chairman Connaughton express 
disappointment with the states' continued course of legal 
action against one another. If the states refuse to work with 
one another, Kempthorne and Connaughton State that the revised 
operational decisions will integrate important information and 
perspectives gained from the negotiations, but regrettably, it 
will necessarily be a solution being directed to the States 
instead of their much hoped for solution coming from the 
States.
    It is my hope that the three Governors will come back to 
the table so the states can take advantage of the productive 
talks and agree on a resolution. Key to any agreement between 
the States is an update of the nearly 20-year-old water control 
manuals for the ACT and ACF River Basins. Army Secretary Pete 
Geren showed real leadership when he announced that the update 
of these manuals would go forward. I am interested in hearing 
from the witnesses whether the Corps had budgeted in this 
budget the necessary funds to begin these updates.
    With that Madam Chairman, I yield back the balance of my 
time.

    Senator Boxer. Thank you so much, Senator.
    This is the order of arrival. It is Isakson, Craig, 
Alexander, Vitter and Bond. So Senator Craig, you are next.

           OPENING STATEMENT OF HON. LARRY E. CRAIG, 
             U. S. SENATOR FROM THE STATE OF IDAHO

    Senator Craig. Thank you, Madam Chairman. And again, thank 
you for your due diligence in having this hearing. It is 
important for all of us.
    Because I think what we will hear today, from us to you, 
General, and to you, Mr. Secretary, are, while we may think in 
broad terms, we become very parochial when the issue is water 
and watersheds and flooding and ports. Most people don't 
appreciate the fact that Idaho has one of the furthest inland 
seaports of the Nation because of the slack waters of the 
Columbia and Snake River system.
    And so I am constantly on point as it relates to that 
system and how it operates, that we maintain our dredging to 
maintain our depths. And of course, as you know, completion of 
the project from the Port of Portland out to the ocean improves 
the whole system because of the size of the freighters that can 
move into the Port of Portland, the locks at the John Day Dam, 
they become critically important to all of us. I will be asking 
you questions about that.
    I think that the Chairman mentioned Sacramento and 
flooding. And of course, the Sierras, especially the Northern 
Sierras, have seen unprecedented snowfalls this winter. It is 
also true in northern Idaho in several of our watersheds up 
there as it relates to the Kootenai and the St. Joe Rivers. In 
fact, at one point, we had a historic depth of snow on ground 
in the valleys in the Coeur d'Alene area. And of course, 
everybody watches closely, to date, our fingers crossed, have 
allowed reasonable warmth and settling of that snow. But we all 
know that certain events can trigger substantial flooding 
beyond the capacity of those watersheds to handle it. It is 
certainly true in the Sierras, it is also true in that region 
of Idaho. So I will be looking forward to any comments there.
    Again, thank you both for being here. Thank you, Madam 
Chair.
    Senator Boxer. Thank you very much.
    Senator Klobuchar.

           OPENING STATEMENT OF HON. AMY KLOBUCHAR, 
            U.S. SENATOR FROM THE STATE OF MINNESOTA

    Senator Klobuchar. Thank you, Madam Chairwoman, for holding 
this important hearing, and thank you for being here.
    It is important to have these hearings, because the budget 
is more than just numbers, it is also an expression of the 
value of our Country. The Water Resources Development Act of 
2007 authorized $23 million for projects around the Country, 
projects that protect State environments, economies and basic 
needs, such as drinking water. I am disappointed that the 
President's budget provided almost no funding for these 
projects.
    Just to give you a few examples from my own State of 
Minnesota, these projects would help communities like Roseau, 
Minnesota, which suffered massive flooding just a few years 
ago, build a flood mitigation system to prevent future 
devastation, or help the city of Willmar build a wastewater 
treatment plant, or fund navigational improvements in the Port 
of Duluth, where lake levels are at record lows because of 
climate change. These projects would provide for continued 
economic growth, job creation and economic stability while 
protecting human lives and ensuring reliable transportation of 
goods.
    I was proud to join 78 of my colleagues in casting my vote 
to override the President's veto of WRDA last year. The 
overwhelming bipartisan nature of that override speaks volumes 
about the critical nature of these projects.
    I firmly believe that we need to change priorities in this 
Country. I am a believer in rolling back some of the Bush tax 
cuts for the wealthiest, people making over $200,000 a year. 
Maybe that's because a bridge fell down in the middle of our 
State and we understand more poignantly than many the need to 
invest in infrastructure proactively. Investing in our national 
infrastructure is one of the most efficient means of creating 
jobs and stimulating the economy. Each billion dollars invested 
in infrastructure creates upwards of 47,000 new jobs and up to 
$6 billion in additional revenues.
    That is why I am very concerned that the Corps' 
construction account and the Corps' investigation account were 
dramatically reduced below what Congress appropriated in 2008. 
These low funding levels continue to exacerbate problems in our 
infrastructure while doing nothing to stimulate our economy.
    So I look forward to working with my colleagues in the 
coming months to start filling this serious investment gap in 
our Nation's infrastructure, a gap whose filling will mean so 
much more for our safety and for our economy.
    Thank you, Madam Chair.
    Senator Boxer. Thank you very much, Senator Klobuchar.
    Senator Alexander.

          OPENING STATEMENT OF HON. LAMAR ALEXANDER, 
            U.S. SENATOR FROM THE STATE OF TENNESSEE

    Senator Alexander. Thank you, Madam Chairman.
    General Van Antwerp and Secretary Woodley, thank you for 
being here. As you know, there is strong support in this 
Committee on both sides of the aisle for roads and bridges and 
airports and locks and infrastructure that helps our Country 
grow new jobs. I appreciate the priority that the Corps has 
tried to put, for example, on the Chickamauga Lock near 
Chattanooga, which is badly in need of repair and which, when 
it is finished, would take 100,000 big trucks off I-75 every 
day, helping us with clean air, with climate change, with 
transportation costs and dependence on foreign oil, all those 
things. So there is an example of how investment in 
infrastructure helps.
    There is one other area I would like to call to your 
attention, and that is the Center Hill Dam in Tennessee, which 
I believe should be considered, repairs to the Center Hill Dam 
should be considered necessary for dam safety. Like Wolf Creek 
Dam in Kentucky, not far away, both Center Hill and Wolf sit on 
a kind of limestone which erode over time and creates 
instability. I assume dam safety is the reason why the Center 
Hill Lake has been lowered, the water level has been lowered, 
and repairs are underway. If that is the case, I think that it 
should be designated as dam safety. That has a great effect on 
ratepayers in Tennessee, and it has an effect on other 
Tennesseans as well. If it is not designated for dam safety, 
then the ratepayers have to fork over $300 million of extra 
money on their electric bills to pay for the repair.
    Second, the delay in dam safety, in repairing Center Hill, 
means that water is not available downstream. Senator Isakson 
talked about the water problems in Georgia. We had them in 
Tennessee last year as well, lakes and streams dried up that 
have not ever dried up before. And with the Center Hill Lake at 
a lower level, the amount of water is not available downstream 
during a drought which is still a problem.
    Finally, if it is not designated for dam safety, it will 
take longer to fix it, longer to repair it. And that means that 
people in the middle Tennessee area will be paying about $100 
million more a year for their electric bill. So I would 
encourage you to consider Center Hill Dam's repair work as dam 
safety repair work, because it is the same kind of problem that 
Wolf Creek has, and Wolf Creek, repairs there are designated 
as, the repairs are necessary for dam safety.
    Thank you very much.
    Senator Boxer. Thank you so much, Senator Alexander.
    Senator Vitter.

            OPENING STATEMENT OF HON. DAVID VITTER, 
            U.S. SENATOR FROM THE STATE OF LOUISIANA

    Senator Vitter. Thank you, Madam Chair and thank you for 
holding this very important hearing. I would like to thank our 
witnesses and the Corps of Engineers for all the important work 
that you are doing, particularly in the hurricane-ravaged Gulf 
Coast. Obviously your work is vital to our future.
    In this hearing, I wanted to specifically focus on three 
big issues to the recovery and three big concerns. One is, the 
money and work for the completion of a new 100 year level of 
protection. First of all, I want to thank you and the President 
and the Administration for a major commitment of an additional 
$5.8 billion in Federal funds to complete that 100 year level 
of hurricane protection. Obviously that is a major commitment 
that is vital to the entire future of our area.
    I do have two very strong and very specific concerns with 
that, however. One is the timing of that money coming to the 
Corps on the ground. As you know, the Administration has 
requested that in this Fiscal Year 2009 budget and has clearly 
made a decision not to request it in the context of the next 
supplemental spending bill, which will happen sooner. I believe 
this ensures, not maybe, I believe this ensures to back up 
completion of that crucial work and have us miss the 2011 
deadline for completion of that work. And as you know, 2011 is 
in itself 1 year pushed back from the original 2010 deadline. 
Every additional hurricane season that passes with the present 
vulnerability of the Gulf Coast is a very high level of risk.
    The second concern I have with that is that the proposed 
cost share for several of the programs involved specifically, 
like Pontchartrain vicinity and SELA, is well below the 
historic cost share. So I strongly disagree with that.
    Second key issue is the outfall canals. The Corps has been 
studying the correct solution to reinforcing strengthening the 
outfall canals where the breaches happened which led to the 
flooding of probably 70 percent of the city of New Orleans. I 
want to know when that final recommendation is going to come to 
us and if it is going to be the recommendation which embodies 
the best alternative in terms of safety and engineering, not 
merely the least expensive, because I have strong concerns 
about that.
    Also, I want to re-urge you to look at the pump to the 
river option as part of that work, which would add great 
reassurance and added protection to the people of the region.
    Finally, the Morganza to the Gulf hurricane protection 
project. As you know, this vital project has been in the works 
for 15 years. It was 1992 when the Corps was first asked to 
look at the Federal interest in that project. In 2000, the 
project was actually authorized in the WRDA bill, contingent on 
a final Corps chief's report. Unfortunately, the Corps missed 
that deadline for the chief's report, so that entire 
authorization went away.
    Finally, in this last WRDA, WRDA 2007, we include full 
authorization, 15 years after the start, for this vital 
hurricane and flood protection project. Yet after all of that, 
the Corps now takes the position that essentially, nothing 
substantial should move forward as the entire project is re-
looked at with a brand new cost benefit analysis. I have grave 
concerns that is foot-dragging of the highest order and true 
bad faith, since this was announced a few weeks after we passed 
the WRDA bill and the Corps never spoke before that point to 
advise us that we should include a higher authorization figure.
    I will look forward to addressing all of these concerns in 
our discussion. Thank you, Madam Chair.
    Senator Boxer. Thank you, Senator.
    Senator Bond.

          OPENING STATEMENT OF HON. CHRISTOPHER BOND, 
            U.S. SENATOR FROM THE STATE OF MISSOURI

    Senator Bond. Madam Chair, Secretary Woodley, General Van 
Antwerp, we thank you very much for this hearing today and for 
your testifying.
    I am very disappointed, Madam Chair, that the 
Administration continues to undermine our efforts to modernize 
our water infrastructure. Despite overwhelming and bipartisan 
support for the Water Resources Development Act of 2007, or 
WRDA, the President's budget does not provide money to update 
the depression-era locks and dams on the Illinois and the 
Mississippi Rivers. Not only are we unable to update our locks 
and dams, this proposal provides a sure path to kill the most 
environmentally sound and cost-effective mode of transportation 
we have.
    The Administration has stated they will propose a tax 
increase on our barges to replenish the Inland Waterway Trust 
Fund, which pays for our water infrastructure. They already pay 
a tax. This budget gimmick will do nothing to address our 
decaying waterway infrastructure. The proposal will raise the 
price of river transportation and thereby discourage river 
traffic. If these materials can't be shipped on the river, they 
will be on our roads and our railways.
    Taking the materials from the most environmentally sound 
and efficient method and putting them on crowded highways that 
are already heavily over-used makes no sense. One barge tow 
carries the same amount of cargo as 870 trucks. How would you 
like the prospect of barge tows moving to highways with 870 
trucks each time?
    Now, my colleagues today have done a good job of pointing 
out and criticizing the lack of funding for extremely critical 
resources in their regions and their States. In the past, we 
have been able to change the budgets to reflect the priorities 
that come from the people we serve in our States, to whom we 
listen, to whom we turn for their support and to whom we owe 
our responsibilities. This has enabled us to overcome some bad 
decisions of OMB in the past.
    But I think we are all aware that there are major populist 
efforts to end all congressional changes, enhancement or 
additions to the President's budget. The populists say, well, 
we are costing money. We are not costing money, we use our 
power to determine better priorities. And we who serve the 
States from which we are elected have a much better idea of 
what those priorities are.
    I would urge my colleagues to exercise great caution. There 
is a move going on in the Hill right now, seems to be popular, 
apparently all the Presidential candidates are getting behind 
it, to end congressional ``interference'' with their budget. I 
used to be an executive. I didn't like having Congress or 
having my general assembly interfere. But that is what members 
of a legislative body are supposed to do. We cannot turn over 
all the direction of spending, which we are empowered under 
Article 1 of the Constitution to authorize and to spend to a 
group of un-elected accountants in OMB, OMB which recommended 
vetoing of the WRDA bill.
    Congress has its legislative priorities. They are focusing 
on appropriations now. Anybody who has served on this Committee 
knows how bad the budgets that we have gotten out of OMB in 
Republican and Democratic years have been. I frankly think that 
the Country would be far worse off if OMB, un-elected 
bureaucrats, were to be the ones to make all the spending 
decisions. If we are going to exercise our responsibility, we 
have to be able to change the budget requests. The President 
proposes, but we are the ones who dispose.
    Madam Chair, this is serious, this and so many areas. I 
thank my colleagues for their consideration.
    Senator Boxer. Thank you very much, Senator.
    Now we will go to Senator Barrasso, and if no other 
Democratic colleague shows up, we will go to Senator Voinovich, 
and then we will start the questions.

           OPENING STATEMENT OF HON. JOHN BARRASSO, 
             U.S. SENATOR FROM THE STATE OF WYOMING

    Senator Barrasso. Thank you very much, Madam Chairman. I 
appreciate your holding this hearing.
    I have been raising some issues with the Army Corps 
regarding TCE, trichloroethylene, which is a chemical that is 
contaminating the water in the city of Cheyenne in the wells at 
Belvar Ranch, which is west of Cheyenne, Wyoming. The Wyoming 
Department of Environmental Quality believes that this 
contamination is directly linked to a former nuclear missile 
site known as Atlas IV. The cleanup is being done, the city of 
Cheyenne folks are paying for that now. Your department is 
aware of this TCE leakage from the site.
    But in a recent letter to me, you stated that your 
information does not support the conclusion that the missile 
site is the cause of the water contamination. It is baffling, 
because the Army Corps believes that there is a 6.5 mile plume 
of TCE emanating from the Atlas missile site, no debate about 
that. The city of Cheyenne has tested their wells and found TCE 
eight and a half miles from the Atlas missile site in one of 
the city's wells. It only stands to reason that there is one 
big plume of TCE. But the Army Corps is suggesting that there 
are two plumes, one that is from the missile site and one that 
is from an unknown source.
    The Wyoming Department of Environmental Quality, the city 
of Cheyenne and any of us who have been to these sites cannot 
fathom what other cause there can be for this TCE, given the 
terrain and the rural setting of the site. Anyone who goes out 
there to take a look, and I would be happy to go with you, 
would say this has to be one, not some other site.
    So I am glad that you are willing to work and continue to 
study this, but this has been going on for a long time. It 
seems that there may be some ignoring of the reality of this 
situation. So I will look forward to asking specific questions 
when it comes around to questions, Madam Chairman, of this 
situation.
    Senator Boxer. Thank you very much, Senator Barrasso. I can 
understand your concern.
    Senator Voinovich.

          OPENING STATEMENT OF HON. GEORGE VOINOVICH, 
              U.S. SENATOR FROM THE STATE OF OHIO

    Senator Voinovich. Thank you, Madam Chairman.
    I would just like to comment about Senator Bond's comments. 
I think all of us on this Committee ought to understand, until 
we do tax reform and entitlement reform, where we take in more 
money, we are never going to be able to do the job. We keep 
talking about extending the tax reductions. We need more money. 
We ought to get it through tax reform and not helter-skelter 
raising of dollars.
    The sooner we wake up to the fact that we don't have enough 
money, that we are not getting the job done, the sooner we will 
be able to deal with some of the problems that these people 
have. Because when they go to OMB, OMB says, here is your 
number and come back with it. And you have to eat it, whether 
you like it or not, you eat it. And our infrastructure problems 
in this Country are overwhelming. They have been swept under 
the rug for too long and it is about time we said something 
about it.
    The fact that we harass you and others that come before 
this Committee is partly our fault. Partly our fault, because 
we haven't faced up to it. This Country is in deep trouble 
today, a budget that is out of control, national debt, dollar 
that is going down and we just sit here like nothing is going 
on. We have a crisis in this Country and I am hoping the 
Presidential candidates have the guts to face up and tell the 
American people the truth. It is about time we faced up to the 
truth. Do you hear me? About time we faced up to the truth. We 
have been playing games around here for too long and I am fed 
up with it.
    I am going to put my statement into the record and I would 
like you to respond to it. I will take care of the questions 
when they come up. Thank you, sir, thank you, Madam.
    [The prepared statement of Senator Voinovich follows:]

         Statement of Hon. George Voinovich, U.S. Senator from 
                           The State of Ohio

    Mrs. Chairman, thank you for calling this hearing on the 
budget of the Environmental Protection Agency. I would like to 
thank Administrator Johnson for being here.
    As a former Governor and Mayor, I know firsthand the 
enormous challenges that you have to address when crafting a 
budget. This is a process that requires responsible 
prioritizing and fiscal discipline to avoid breaking the bank.
    And this leads me to a point I've made time and time again: 
We must find a way to balance our nation's environmental, 
energy and economic policies. It might make us feel good to set 
lofty environmental goals, but those goals do little good when 
they are unachievable due to practical or economic 
considerations. They are even less good when they impose 
economic hardship to those who can't comply.
    The issue of unfunded mandates is a problem that is 
pervasive throughout government, but nowhere more so than in 
environmental regulation. At best, standards are set with 
little consideration as to how they will be met. At worst, 
standards are set without regard to the costs of compliance. 
The national ambient air quality standards (NAAQS) and the 
Clean Water Act are prime examples of this disconnect between 
our policy objectives and a case study in unintended 
consequences.
    Leaving a discussion of the standards setting process to 
another day, I will simply say that if we set environmental 
standards, we must be ready, as a government, to help 
communities meet those standards.
    In regard to this year's budget proposal, I am concerned 
about funding for the Diesel Emissions Reduction Act (DERA). 
DERA was designed to help meet our nation's air quality 
standards by reducing emissions from the nation's legacy fleet 
of over 11 million diesel engines. DERA authorized $1 billion 
over a 5-year period ($200 million annually). Properly funded, 
and leveraging match requirements for State and local 
governments at a ratio of $2 to $1, EPA estimated that DERA had 
the potential to contribute to a 70,000 ton reduction in PM 
emissions and generate $20 billion in economic and health 
benefits.
    You have requested $49.2 million for fiscal year in what 
will be the third year of a 5-year program. I can't stress 
enough the need for increasing DERA funding as we begin the 
appropriations process. DERA is a well balanced policy to 
reduce air emissions and it would be a shame to let the program 
sunset before its benefits can be fully realized.
    I am also disappointed to see that the administration's 
proposed funding for the Great Lakes Legacy Act is $35 million 
for fiscal year 9. This is a significant decrease from the 
$49.6 million that the administration proposed 2 years ago. 
This program shows results--hundreds of thousands of cubic 
yards of contaminated sediments have been removed from the 
Great Lakes--and I strongly encourage you to work to increase 
funding for this program.
    Administrator, working with the Great Lakes Regional 
Collaboration, you have worked to make the restoration and 
protection of the lakes a priority at EPA. As co-chair of the 
Senate Great Lakes Task Force, I am eager to find ways to 
improve the Collaboration's efforts and ensure the Great Lakes 
programs, like the Legacy Act, receive the funding they need to 
be successful.
    As a member of this Committee, I have sought to bring 
attention to the nation's wastewater infrastructure needs. But 
as with previous years, EPA's budget is woefully inadequate. In 
fact, your request represents the lowest funding level in the 
program's history!
    Continued cuts to the SRF program--when EPA estimates the 
nation's need for wastewater treatment and collection at $193.5 
billion--makes no sense. This especially concerns me because my 
State of Ohio has one of the largest needs in the Nation at 
$11.7 billion.
    Here are a number of examples from Ohio alone: The city of 
Defiance, which has a population of 17,000 and recently lost 
950 auto industry jobs, is required to spend $60 million over 
20 years to fix the city's combined sewer overflow problems. In 
response, the city is being forced to double its rates. The 
city of Fostoria, population of 14,000, is facing a $35 million 
project. This city has lost 10 percent of its jobs over the 
past 2 years, in part due to their increasing water rates. They 
are being forced to increase their rates by $100 per year over 
the next 15 years. EPA is requiring the city of Fremont, 
population of 26,000 people (49 percent are considered low-
income), to spend $63 million. Their rate increases will be 150 
percent.
    EPA is simply not stepping up to the plate to assist the 
thousands of communities across the country facing substantial 
costs to comply with EPA orders. I must tell you that from my 
experience as a former mayor, county commissioner, and 
Governor, I consider this to be an unfunded mandate.
    Administrator, we are asking our communities to do the 
impossible. If the Federal Government is going to impose these 
costly mandates on struggling State and local governments, then 
it should provide funding and flexibility for compliance with 
those mandates.
    Again, I would like to thank you for your attendance today, 
and I look forward to hearing your thoughts on these issues. 
Thank you, Mrs. Chairman.

    Senator Boxer. Senator Voinovich, don't hold back.
    [Laughter.]
    Senator Boxer. I love it. I think it is good that you are 
speaking from the heart.
    I did want to say, before we call on our panel, I know 
there are going to be disagreements from the Republican side 
and maybe even on our side, on the budget. But the budget does 
attempt to shake things up and change things, and does add back 
$1.2 billion to your budget. It does go to $300 million over 
last year, because our budget priorities are infrastructure, 
jobs and boosting the economy. So again, there will be a lot of 
debate on the floor over that, but I hope colleagues will 
realize that we do our best in this budget to restore the 
funding and give it even $300 million over where we were last 
year.
    Gentlemen, we are so happy you are here. Are you both going 
to speak to us today, or just one of the two of you, with 
prepared remarks?
    Mr. Woodley. Chairman Boxer, I believe we are both prepared 
to.
    Senator Boxer. That is good.
    Mr. Woodley. But if you would prefer----
    Senator Boxer. No, we would like to hear from both of you, 
actually. So 5 minutes each if you can.

 STATEMENT OF HON. JOHN PAUL WOODLEY, JR., ASSISTANT SECRETARY 
                          OF THE ARMY

    Mr. Woodley. I will summarize the statement briefly and ask 
that the complete statement be included in the record.
    Senator Boxer. Without objection, so ordered.
    Mr. Woodley. The civil works budget provides funding for 
development and restoration of the Nation's water and related 
resources, primarily within the three main program areas of 
commercial navigation, flood and coastal storm damage reduction 
and aquatic ecosystem restoration. The budget also supports 
hydropower, recreation, environmental stewardship and water 
supply storage at existing Corps projects.
    Finally, the civil works budget provides for protection of 
waters and wetlands, cleanup of sites contaminated as a result 
of the Nation's early efforts to develop atomic weapons and 
emergency preparedness.
    The budget for the Fiscal Year 2009 annual civil works 
program is $4.74 billion. In addition, the President's budget 
requests $5.761 billion in Fiscal Year 2009 emergency 
appropriations for the Federal share of the additional funds 
needed to reduce the risk to the Greater New Orleans, Louisiana 
area from storm surges that have a 1 percent annual chance of 
occurring.
    I would first like to talk about the annual civil works 
program. The budget includes $1 million in the investigations 
account for independent peer review requirements of Section 
2034 of the Water Resources Development Act of 2007. The 
investigations account also includes $2 million for a high 
priority study authorized by Section 2032(b) of the Water 
Resources Development Act of 2007 of the vulnerability of the 
U.S. to damage from flooding, including assessment of 
comparative risks faced by different regions of the Country.
    The budget again proposes performance criteria to allocate 
funds among construction projects. These criteria give priority 
for funding to the projects that yield the greatest returns to 
the Nation based on objective performance criteria. The Fiscal 
Year 2009 construction performance criteria mirror those for 
Fiscal Year 2008, except that priorities accorded to projects 
that can be completed in Fiscal Year 2009. The budget allocates 
funding among ongoing construction projects based primarily on 
benefit to cost ratios. Priority is also accorded projects that 
reduce significant risks to human safety and to dam safety 
assurance, seepage control and static instability correction 
projects.
    For operation and maintenance of the civil works projects, 
the Fiscal Year 2009 budget provides nearly $2.6 billion in the 
operation and maintenance account, and $163 million in the 
Mississippi River and Tributaries account, a total of $16 
million higher than in the Fiscal Year 2008 budget for 
comparable activities, which in turn provided a substantial 
increase over prior O&M levels.
    The budget also provides $729 million to be appropriated 
from the Harbor Maintenance Trust Fund for operation and 
maintenance of commercial navigation channels and harbors. The 
growth of the Trust Fund balance and ways to address this 
balance are being discussed within the Administration. We will 
continue to work within the Administration to develop policies 
to effectively use the Harbor Maintenance Trust Fund.
    Like the budgets for the last 2 years, the Fiscal Year 2009 
budget proposes to allocate operation and maintenance funding 
on a regional basis. The budget proposes to allocate operation 
and maintenance funding among 54 areas based on USGS sub-
watersheds. This approach will improve the overall performance 
of civil works assets. Managers in the field will be better 
able to maintain key infrastructure, adapt to uncertainties and 
address emergencies and other changed conditions over the 
course of the fiscal year.
    As anticipated this time last year, the Fiscal Year 2009 
budget is based on enactment of proposed legislation to 
establish a lockage-based barge user fee and phase out the 
existing fuel tax. The proposed legislation will be transmitted 
to Congress very soon after an executive branch inter-agency 
review of this proposal is completed. Prompt enactment of such 
legislation is needed to address the declining balance of the 
Inland Waterways Trust Fund, which otherwise will run out of 
funds around the end of the 2008 calendar year, and to support 
ongoing and future inland waterway projects.
    The budget provides $185 million for the Corps of 
Engineers' share of the South Florida Everglades ecosystem 
restoration program, which is the most ever budgeted or 
appropriated for the Corps in 1 year for these activities. This 
level of funding for the Corps is an increase of $54 million, 
or 41 percent, compared to the Fiscal Year 2008 enacted level. 
The budget also includes $20 million for the Louisiana Coastal 
Area Restoration Effort, including $10 million for its science 
program.
    The budget also provides $180 million for the Corps' 
regulatory program to protect wetlands and other waters of the 
United States. This is the same amount as both the budget and 
appropriation for Fiscal Year 2008, and, Madam Chair, 
represents a $55 million increase since 2001.
    I'd like to turn to the proposed emergency appropriation, 
$5.76 billion. The Fiscal Year 2009 budget proposes to 
authorize the New Orleans Area Hurricane and Storm Damage and 
Risk Reduction System to be constructed with the State of 
Louisiana as the single non-Federal cost-sharing sponsor and 
subsequently maintained and operated by the State.
    The pre-Katrina system for the Greater New Orleans area was 
built as a collection of separately authorized projects, 
designed with differing standards, subject to different 
requirements for non-Federal cost-sharing and managed by 
different local entities. Based on the statutory language 
proposed in the budget, the non-Federal sponsor would provide 
$1.5 billion for the non-Federal share of this work. The New 
Orleans area system will be not only higher, but also stronger, 
than the pre-Hurricane Katrina system.
    Upon passage of the Water Resources Development Act of 
2007, the Chief of Engineers and I established a joint team to 
oversee its implementation. I meet bi-weekly with the Joint 
WRDA implementation team to establish policy, issue 
implementing guidance and assess progress. Priority for 
implementation guidance is being given to national policy 
provisions, most of which are in Title II, and to those project 
and program provisions for which funds are currently 
appropriated.
    In summary, at $4.74 billion, the Fiscal Year 2009 Army 
Civil Works annual budget provides the resources for the civil 
works program to pursue investments that will yield very good 
returns for the Nation in the future. As in past years, this 
budget does not fund all the important work the Corps could do 
in Fiscal Year 2009. However, it represents wise use of funding 
to advance worthy mission-based objectives.
    Chairman Boxer and members of the Committee, this is my 
last time to appear before you to present an Army Civil Works 
budget on behalf of President Bush. I want you to know that it 
has been a great pleasure and privilege to work with you, 
Senator Inhofe and all the other members of the Committee from 
time to time. I think it would be wrong of me not to mention 
that I believe this Committee is served by one of the most 
professional and knowledgeable staffs of any committee in any 
legislature anywhere in the world.
    Senator Boxer. Thank you.
    Mr. Woodley. We have a very complex program and they 
understand it and serve you very well, serve you and the people 
of the Country very well.
    I want to also say that many of the efforts, as you will 
see in the coming year, represent a very, very substantial 
effort to implement the provisions of WRDA 2008. Much of our 
budget was developed and submitted in the early fall, well 
before WRDA 2007 was enacted. We were able to do some things 
late in the budget cycle to respond to the important 
initiatives of WRDA 2007. I appreciate the committee's 
disappointment that more was not done. But it really did come 
at a very late stage in our process. We would like to have done 
more and we will do more, I am confident we will do more in 
Fiscal Year 2009.
    [The prepared statement of Mr. Woodley follows:]

  Statement of John Paul Woodley, Jr., Assistant Secretary of the Army

    Madam Chair and distinguished members of the Committee, 
thank you for the opportunity to testify before the Committee, 
and to present the President's Budget for the Civil Works 
program of the Army Corps of Engineers for Fiscal Year (FY) 
2009.


                                overview


    The fiscal year Budget for Army Civil Works provides 
funding for development and restoration of the Nation's water 
and related resources within the 3 main Civil Works program 
areas, namely, commercial navigation, flood and coastal storm 
damage reduction, and aquatic ecosystem restoration. The Budget 
also supports hydropower, recreation, environmental 
stewardship, and water supply services at existing water 
resources projects owned or operated by the Corps. Finally, the 
Budget provides for protection of the Nation's regulated waters 
and wetlands; cleanup of sites contaminated as a result of the 
Nation's early efforts to develop atomic weapons; and emergency 
preparedness. The budget does not fund work that should be the 
responsibility of non-Federal interests or other Federal 
agencies, such as wastewater treatment and municipal and 
industrial water treatment and distribution.
    Total discretionary funding for the fiscal year annual 
program is $4.741 billion. This is $130 million less than the 
fiscal year budget and $846 million less than Energy and Water 
Development appropriations for fiscal year 8. Within the total 
Civil Works budget, $2.475 billion is for activities funded in 
the operation and maintenance (O&M) account. This is slightly 
higher than the funding level for operation and maintenance 
proposed in the President's fiscal year budget, which in turn 
was a substantial increase over prior budget or appropriation 
levels for comparable O&M activities.
    The Budget also provides $5.761 billion in an fiscal year 
emergency appropriations request for the Federal share of the 
additional funds needed to reduce the risk of storm surge 
damage to the greater New Orleans, Louisiana area. Based on 
statutory language proposed in the Budget, the non-Federal 
sponsor would provide $1.527 billion for the non-Federal share 
of this work. This proposal is discussed further below.
    A budget Five Year Development Plan (FYDP) is under 
development and will be provided to the relevant Committees of 
Congress.
    Enclosure 1 displays the current estimate for the 
distribution of new discretionary funding among 8 appropriation 
accounts; 8 program areas; supervision and general 
administration of the Civil Works program; policy direction and 
oversight by the Army Secretariat; and 5 funding sources, 
including the general fund of the Treasury and trust funds. 
Enclosure 2 is a crosscut between appropriation accounts and 
program areas.


                      performance-based budgeting


    The fiscal year Budget reflects a continuing maturation of 
the Army's performance-based approach to budgeting. Competing 
investment opportunities for studies, design, construction, and 
operation and maintenance were evaluated using multiple 
metrics. Objective performance criteria guided the allocation 
of funds among construction projects (see below).
    The Budget includes initiatives leading to the development 
of a more systematic, performance-based budget and improved 
asset management. For example, the Budget allocates operation 
and maintenance funding among 54 geographic areas based on USGS 
sub-watersheds. This approach will improve the overall 
performance of Civil Works assets by enabling managers within 
each of these regional areas to focus on their key facilities 
and address emerging needs.
    The focus on Civil Works program performance has a number 
of foundations. First, the 2004-2009 Civil Works Strategic Plan 
provided goals, objectives, and performance measures that are 
specific to program areas as well as some that are 
crosscutting. A new Civil Works Strategic Plan is under 
development for 2009-2014. Second, each program area has been 
assessed using the Program Assessment Rating Tool (PART). 
Progress to improve the performance measures was made on 
several programs during the past year. Summaries of all 
completed civil works program assessments can be found on the 
Administration's new website, www.ExpectMore.gov. The Civil 
Works Strategic Plan and the PART-based program evaluations are 
works in progress and will continue to be updated.


            highlights--water resources development accounts


Studies and Design
    The fiscal year Budget provides $91 million for the 
Investigations account and $1 million for investigations in the 
Mississippi River and Tributaries account. The Budget funds 65 
studies and preconstruction engineering and design (PED) 
activities. We selected these for funding based on their likely 
performance. For instance, the projects funded for PED were 
those with benefit-to-cost ratios (BCRs) of 3.0 to-1 or higher.
    Within this $91 million, $10 million is for studies and PED 
under the Louisiana Coastal Area ecosystem restoration program 
and $10 million more is for the science program that supports, 
and is an integral component of, this Corps effort to help 
protect and rebuild the ecosystem. In addition, $21 million is 
for other project-specific studies and design, $17 million is 
for research and development, and $33 million is for other 
coordination, data collection, and study activities.
    The Administration urges the Congress to support the 
President's Budget for the investigations program, which limits 
the number of proposed projects funded at the study or design 
stage. The Corps has a very large backlog of ongoing 
construction work. Adding to the number of projects heading for 
a construction start or to their funding will delay the 
completion of ongoing projects and realization of their 
benefits to the Nation. The enactment of WRDA 2007 has 
heightened this concern.
    The Civil Works budget includes $1 million to comply with 
the independent peer review requirements of Section 2034 of the 
Water Resources Development Act of 2007 (WRDA 2007). This 
covers only the studies funded in the Budget. If the Congress 
were to increase the number of studies or their funding, the 
Corps would likely need more than $1 million to comply with 
section 2034.
    Independent review previously was funded through individual 
study line items as study costs shared with the non-Federal 
sponsor. Under WRDA 2007, the costs of independent review are 
now fully Federal. In future Budgets, we expect to include 
these costs under individual study line items after studies 
requiring Section 2034 independent review are identified and 
accounting codes are set up to distinguish the fully Federal 
independent review costs from the other study costs, which the 
non-Federal sponsor will share.
    The fiscal year Budget includes 2 new studies: The 
Investigations account includes $2 million for a high-priority 
study of the vulnerability of the U.S. to damage from flooding, 
including an assessment of the comparative risks faced by 
different regions of the U.S. This study will provide 
background for a subsequent effort by policy officials to 
develop recommendations to improve existing Federal programs, 
authorities, and roles. The other new study is the Atchafalaya 
Basin Land Study in the Flood Control, Mississippi River and 
Tributaries account, for which the Administration has 
repeatedly requested funding. I urge you to fund this study. It 
has a high priority because land acquisition is an important 
component of the overall flood damage reduction plan for this 
watershed. The fiscal year Budget also specifically identifies 
$100,000 for Corps support to the efforts of the inter-agency 
Committee on the Marine Transportation System, established by 
the President in the 2004 Ocean Action Plan. Costs to support 
the Committee previously were included in the Coordination with 
Other Agencies allocation in the Investigations account.
Construction Program
    The Budget provides $1.402 billion in the Construction 
account and $76 million for construction projects in the 
Mississippi River and Tributaries account.
    Many more construction projects have been authorized, 
initiated, and continued than can be constructed efficiently at 
any one time. The funding of projects with low economic and 
environmental returns and of projects that are not within Civil 
Works main mission areas has led to the postponement of 
benefits from the most worthy projects, and has significantly 
reduced overall program performance.
    To remedy this situation and to achieve greater value to 
the Nation from the Civil Works construction program, the 
Budget again proposes performance guidelines to allocate funds 
among construction projects. The guidelines give priority for 
funding to the projects that yield the greatest returns to the 
Nation, based upon objective performance criteria. The fiscal 
year guidelines mirror those for fiscal year 8, except that 
priority also is accorded to projects that can be completed in 
fiscal year 9.
    Under the guidelines, the Budget allocates funds among 
construction projects based primarily on these criteria: BCRs; 
contribution to reducing significant risk to human safety or to 
dam safety assurance, seepage control, or static instability 
correction concerns; capability of high performing projects to 
be completed in fiscal year in order to bring significant 
benefits online; and the extent to which projects cost-
effectively contribute to the restoration of nationally or 
regionally significant aquatic ecosystems that have become 
degraded as a result of Civil Works projects, or to a 
restoration effort for which the Corps is otherwise uniquely 
well-suited. The construction guidelines are provided in 
Enclosure 3.
    The 79 construction projects funded in the Budget consist 
of: 11 dam safety assurance, seepage control and static 
instability correction rehabilitation projects; 16 projects 
funded to address a significant risk to human safety (including 
2 new deficiency correction projects); and 52 other projects 
(including 5 in the Mississippi River and Tributaries program).
Operation and Maintenance Program
    The fiscal year Budget proposes $2.475 billion for the 
Operation and Maintenance account and $163 million for 
maintenance activities in the Mississippi River and Tributaries 
account. The total amount is $16 million higher than the fiscal 
year Budget for comparable activities.
    The Budget emphasizes performance of existing projects by 
focusing on the maintenance of key commercial navigation, flood 
and storm damage reduction, hydropower, and other facilities. 
The proposed funding would enable the Army Corps of Engineers 
to carry out priority maintenance, repairs, and 
rehabilitations, and priority initiatives such as the 
development of asset management systems.
    As in the fiscal year and 2008 Budgets, the operation and 
maintenance program includes 4 activities that are directly 
related to the operation and maintenance of Corps projects, but 
previously were funded in the Construction program--compliance 
with the Endangered Species Act at operating projects; 
rehabilitation of existing projects; replacement of sand due to 
the operation and maintenance of Federal navigation projects; 
and construction of facilities, projects, or features 
(including islands and wetlands) to use materials dredged 
during Federal navigation operation and maintenance activities. 
The Budget transfers responsibility for these activities to 
improve investment decisions on project operation and 
maintenance and better provide accountability and oversight for 
those decisions. For the inland navigation rehabilitation 
projects budgeted in the Operation and Maintenance account, 
one-half of the project funding would be derived from the 
Inland Waterways Trust Fund. Construction, replacement, and 
expansion of inland waterways projects continue to be budgeted 
in the Construction account.
    Like the Budgets for the past 2 years, the fiscal year 
Budget proposes to allocate operation and maintenance funding 
on a regional basis. Last year, the Budget proposed allocation 
of funding by 21 watersheds identified by the U.S. Geological 
Survey's watershed and sub-watershed identification system. 
This year, in order to more clearly identify the systems among 
which funding is allocated, the Budget proposes to allocate 
funding among 54 systems. Within these 54 systems, the 
justification materials allocate funding for illustrative 
purposes to flood and coastal storm damage reduction, 
commercial navigation, hydropower, stewardship, recreation, and 
water supply program areas. Funding operation and maintenance 
using this framework will increase efficiency in the operation 
and maintenance of Civil Works projects. Managers in the field 
will be better able to properly maintain key infrastructure, 
adapt to uncertainties, and address emergencies, as well as 
other changed conditions over the course of the fiscal year, 
while complying with congressional direction for the 
appropriations.


                       highlights--program areas


    The Army Civil Works program includes 8 program areas; 
commercial navigation, flood and coastal storm damage 
reduction, environment, recreation, hydropower, water supply, 
emergency management, and the regulatory program. The Budget 
also funds the supervision and general administration of the 
Civil Works program in the Corps headquarters and the eight 
division offices; and the policy direction and oversight for 
the program by the Office of the Assistant Secretary of the 
Army (Civil Works). Budget proposals for all areas are 
discussed below.
Flood and Coastal Storm Damage Reduction, and Emergency Management
    The fiscal year Budget provides $1.322 billion for flood 
and coastal storm damage reduction and $58 million for 
emergency management.
    Among the 79 construction projects funded in the fiscal 
year budget, 50 are for flood and coastal storm damage 
reduction, including 11 dam safety and seepage control and 
static instability correction rehabilitations, 2 deficiency 
correction projects at St. Louis Flood Protection, Missouri and 
Wood River Levee, Illinois; and 29 other projects that address 
a significant risk to human safety or were selected based on 
their benefit-to-cost ratios.
    The Budget for the emergency management program includes 
$40 million in the Flood Control and Coastal Emergencies 
account to fund preparedness for flood and coastal emergencies 
and other natural disasters. This funding is needed in fiscal 
year to maintain and improve the Corps of Engineers ability to 
respond to disasters. Specifically, this funding would cover 
review and updating of emergency response plans, periodic 
exercises to test and evaluate plans, training, procurement of 
critical supplies and equipment, and pre-disaster coordination 
with State and local governments and other Federal agencies. 
The fiscal year Budget reflects the strong belief of the Army 
in the importance of providing regular funding for emergency 
preparedness, rather than relying on supplemental 
appropriations to finance emergency preparedness. The emergency 
management program also includes $6 million for the National 
Emergency Preparedness Program and $12 million for facility 
protection, both of which are funded in the Operation and 
Maintenance account. We continue to fund facility protection as 
a remaining item in the operation and maintenance account. In 
the past, we allocated these costs among the 8 program areas. 
This year, we included these costs instead under the emergency 
management program area.
    The Budget includes $14 million in multiple accounts for 
Actions for Change--a set of actions identified by the Chief of 
Engineers to aggressively incorporate the lessons learned from 
Hurricanes Katrina and Rita into the way the Corps plans, 
designs, constructs, and maintains its infrastructure. The 
program is being executed by 4 national teams. All actions are 
interrelated, but each of the 4 teams has one of the following 
focus areas: comprehensive systems approaches; risk-informed 
decisionmaking; risk communications; and professional and 
technical expertise. A common theme throughout the program is 
increased accountability for public safety. The Corps is 
working toward the goal of making these changes self-
sustaining.
    The fiscal year Operation and Maintenance account includes 
$10 million for the National Levee Inventory/Inspection and 
Levee Safety Program. These funds will be used to continue the 
national levee inventory, assessment, and data base development 
that were begun with emergency supplemental appropriations of 
$30 million in fiscal year 6. Funds also will be used for 
administrative and travel costs of the National Levee Safety 
Committee established pursuant to Title IX of the Water 
Resources Development Act of 2007. Title IX broadened the 
authority under which the Corps conducts the levee inventory 
program and is being implemented under the ongoing levee 
inventory and inspection program. The national levee inventory 
is an interagency effort to improve management of the Nation's 
flood and storm damage reduction infrastructure. The results of 
the national project inventory and risk-based project 
assessments will be linked to the Federal Emergency Management 
Agency's ongoing flood mapping program, as well as to the Corps 
levee rehabilitation and inspection program.
    The Budget provides funding for all work currently planned 
to remedy the most serious (Action Class I and II) dam safety, 
seepage, and static instability problems at Corps dams. The 
planning, design, and construction of these projects are funded 
at the maximum amount that the Corps estimates that it can use 
efficiently and effectively.
    The Budget continues to support Federal participation in 
initial construction, but not in re-nourishment, at beach 
nourishment projects that provide storm damage reduction or 
ecosystem restoration outputs.
Commercial Navigation
    The fiscal year Budget provides a total of $1.892 billion 
for the commercial navigation program area.
    The amount budgeted for inland waterway construction 
projects (construction, replacements, and expansions in the 
Construction Account, and rehabilitations in the Operation and 
Maintenance account) is about $326 million, which includes 
funding to continue 14 inland waterway projects; 3 seepage and 
static instability correction rehabilitation projects; 
completion of 5 projects; and continuation of construction on 5 
other projects. Half of the funding for these inland waterways 
investments, about $167 million, would be derived from the 
Inland Waterways Trust Fund, reflecting both concurrent 
financing of 50 percent of construction costs on most projects 
and rebalancing of the proportion where prior expenditures from 
the general fund of the Treasury exceeded 50 percent.
    The fiscal year Budget is based on enactment of proposed 
legislation to establish a lockage-based barge user fee and to 
phase out the existing diesel fuel tax for the inland 
waterways. The prompt enactment of such legislation is needed 
to address the declining balance in the Inland Waterways Trust 
Fund, which otherwise will run out of funds around the end of 
the 2008 calendar year, and to support ongoing and future 
inland waterways projects. The funding in the Inland Waterways 
Trust Fund, which comes from the diesel fuel tax, will not be 
sufficient after fiscal year to support needed levels of 
investment in these waterways.
    Enactment of the Administration's legislative proposal 
would ensure that the commercial users of the Corps locks 
continue to cover their share of project costs. The amount of 
the user fee would be tied to the level of spending for inland 
waterways construction, replacement, expansion and 
rehabilitation work. The proposed legislation will be 
transmitted to Congress shortly.
    The Budget includes $170 million to construct channel and 
harbor projects.
    The Budget focuses navigation operation and maintenance 
funding of $1.375 billion on those waterway segments and 
commercial harbors that support high volumes of commercial 
traffic, such as the heavily used Mississippi and Ohio Rivers 
and the Illinois Waterway. The Budget also funds maintenance of 
harbors that support significant commercial fishing, 
subsistence, safety, harbor of refuge, national security, or 
public transportation benefits.
    The Corps continues development of techniques to identify 
and compare the marginal impacts on the Nation's waterborne 
commerce of varying maintenance levels for coastal channels and 
harbors. The fiscal year Budget provides for $729 million to be 
appropriated from the Harbor Maintenance Trust Fund for 
operation and maintenance. The growth of the trust fund balance 
and ways to address this balance are being discussed within the 
Administration. We will continue to work within the 
Administration to develop policies to effectively use the 
Harbor Maintenance Trust Fund.
    The Budget continues the policy of funding beach 
replenishment, including periodic re-nourishment, where the 
operation and maintenance of Federal navigation projects is the 
reason for the sand loss on shorelines.
Environment
    The fiscal year Budget provides $511 million for 
environmental activities overall, including $286 million for 
aquatic ecosystem restoration. The costs of compliance with 
Biological Opinions at existing projects are not included in 
the above figures. The Budget includes these costs as part of 
the joint operation and maintenance costs of the affected 
projects and allocates these costs among the program areas 
served by the projects.
    Within the $286 million for aquatic ecosystem restoration, 
$185 million is for the Corps of Engineers share of the South 
Florida Everglades Ecosystem Restoration Program, which is the 
most ever budgeted or appropriated for the Corps in 1 year for 
these activities. This level of funding for the Corps is an 
increase of $54 million, or 41 percent, compared to the fiscal 
year enacted level. The increase reflects the program's 
priorities for 2009--which include more funding for the 
Modified Water Deliveries to Everglades National Park (Mod 
Waters) project, a key element of this effort that both the 
National Park Service and the Corps are funding (+$40 million); 
and funding to restore a 90 square mile area west of the 
Everglades known as Picayune Strand, which will provide habitat 
suitable for the endangered Florida panther and other species 
(+$24 million). The Budget for this program also emphasizes 
continued construction of the Kissimmee River restoration 
effort; and studies and design work under the Comprehensive 
Everglades Restoration Plan, or CERP. Finally, the Budget also 
continues construction of the Everglades and South Florida 
Ecosystem Restoration ``Critical Projects,'' and the South Dade 
County (C-111) and West Palm Beach Canal (C-51 & STA 1-E) 
Central and Southern Florida (C&SF) projects.
    The Budget provides $20 million for the Upper Mississippi 
River System Environmental Management Program and $20 million 
for the Louisiana Coastal Area restoration effort, including 
$10 million for its important Science Program, which will 
assist the State and Federal managers of the LCA Ecosystem 
Restoration Program by providing science support aimed at 
improving implementation. The Science Program will inform and 
guide the program by reducing uncertainties and insuring that 
effective tools and processes are available for use by the 
project delivery team.
    The Budget includes $95 million for environmental 
stewardship. The Corps administers lands and waters covering 11 
million acres, an area equal in size to the States of Vermont 
and New Hampshire. Funded activities include shoreline 
management, protection of natural resources, support for 
endangered species, continuation of mitigation activities, and 
protection of cultural and historic resources.
    The Budget provides $130 million for the Formerly Utilized 
Sites Remedial Action Program (FUSRAP) to clean up 
contamination at sites resulting largely from the early atomic 
weapons program. This funding will enable completion of 
remedial action at one site (Linde Air Products Soil operable 
unit) and support continued progress toward completion of 
remedial actions at a number of other FUSRAP sites.
Regulatory Program
    The fiscal year Budget provides $180 million for the Corps 
Regulatory Program to protect wetlands and other waters of the 
United States. This is the same as the amount in both the 
Budget and appropriations for fiscal year 8, and represents a 
$55 million increase since 2001. The funding will be used for 
permit processing, enforcement and compliance actions, and 
jurisdictional determinations, including the significant 
additional field documentation, coordination and evaluation 
work associated with the Supreme Court's Carabell and Rapanos 
decisions.
    Investing in the Regulatory Program has a win-win result, 
since it protects valuable aquatic resources while enabling 
over $225 billion in economic development to proceed annually. 
The Corps will also use the requested funding to develop and 
implement improvements such as electronic permit applications 
and data sharing with other agencies and the public, consistent 
with Sections 2017 and 2040 of WRDA 2007.
Recreation
    The fiscal year Budget provides $270 million for recreation 
operations and related maintenance. The Budget re-proposes the 
Corps of Engineers recreation modernization initiative, which 
first was developed as part of the fiscal year and fiscal year 
budgets. This initiative, which requires legislation to 
implement, would allow the Corps to upgrade and modernize its 
recreation facilities through an expansion of the current fee 
structure. It would also enable the Corps, working at the 
national, state, and local levels, to pursue voluntary public/
private partnerships and other means to help finance the 
recreation program.
Hydropower
    Hydropower is a renewable source of energy. The Civil Works 
program is the Nation's largest producer of hydroelectric 
energy. The Corps provides one quarter of the Nation's 
hydroelectric power generation capacity and satisfies 3 percent 
of the Nation's total energy needs.
    The fiscal year Budget provides $319 million for 
hydropower. This investment will help to reduce the forced 
outage rate, which remains well above the industry average. In 
addition, the 4 ongoing replacement projects, once completed, 
will produce enough power to electrify 37,000 homes and reduce 
carbon dioxide emissions into the atmosphere by 190,000 metric 
tons.
Water Supply
    On average, Civil Works projects provide 4 billion gallons 
of water per day to meet the needs of municipal and commercial 
users across the country. The Budget includes $6 million for 
this program under the operation and maintenance account. These 
costs can be broken into 5 categories: costs to manage water 
supply contracts and to operate and maintain specific water 
supply facilities; ongoing water reallocation studies; the 
National Portfolio assessment of water reallocation 
possibilities; the allocated share of costs for compliance with 
the Endangered Species Act; and the allocated share of other 
project joint costs. The water supply program manages 307 water 
supply agreements that cover 7.2 million acre-feet of storage 
space in 136 of the Corps' multiple purpose reservoir projects. 
This storage space has an assigned repayment value of $9.8 
billion. These costs are repaid directly to the U.S. Treasury 
by the water users. The opportunities that are being identified 
through the National Portfolio assessment to reallocate storage 
space in existing reservoirs can assist in addressing unmet 
demand for municipal and industrial water supply without 
building additional projects.
Management Expenses of the Army Corps of Engineers
    The fiscal year budget provides $177 million for the 
Expenses account to cover the costs of the Army Corps of 
Engineers Headquarters, Major Subordinate Commands or 
Divisions, and national support Corps offices such as the 
Humphreys Engineer Center Support Activity, the Institute for 
Water Resources, and the Finance Center.
Army Secretariat Policy Direction and Oversight
    The fiscal year Budget includes $6 million for the Office 
of the Assistant Secretary of the Army (Civil Works). The 
Assistant Secretary of the Army (Civil Works) has oversight 
responsibility on behalf of the Secretary of the Army for all 
aspects of the Civil Works program of the Army Corps of 
Engineers; for the Army Cemeterial Expenses budget and program 
for Arlington National Cemetery and the Soldiers' and Airmen's 
Home National Cemetery; for reimbursable support by the Army 
Corps of Engineers for other domestic agencies; and for all 
international activities of the Army Corps of Engineers except 
those directly in support of U.S. forces overseas. This account 
finances the personnel and other direct costs of the Assistant 
Secretary's office in the energy and water development 
appropriation, consistent with recently enacted appropriations 
for this office.


            protection of the metropolitan new orleans area


    In addition to fiscal year regular appropriations for the 
Civil Works program, the fiscal year Budget recommends 
enactment of fiscal year emergency appropriations of $5.761 
billion for the remaining Federal share of the New Orleans Area 
Hurricane and Storm Damage and Risk Reduction System (HSDRRS), 
which is designed to reduce the risk to the greater New 
Orleans, Louisiana, area from storm surges that have a 1 
percent annual chance of occurring and to improve internal 
drainage; to restore and complete construction of hurricane and 
storm damage reduction features in surrounding areas to 
previously authorized levels of protection; and to incorporate 
certain non-Federal levees into the Federal system. The fiscal 
year Budget also proposes to authorize the HSDRRS to be 
constructed with the State of Louisiana as the single non-
Federal cost-sharing partner and subsequently maintained and 
operated by the State. Pre-Katrina, the HSDRRS was built as a 
collection of separately authorized projects, designed with 
differing standards, subject to differing requirements for non-
Federal cost-sharing, and managed by different local entities.
    The new HSDRRS system will be not only higher, but also 
stronger than the pre-Hurricane Katrina system. Armoring of 
critical elements will improve resilience during storm events. 
New pump stations, water control structures, and floodgates 
will add perimeter protection to reduce the threat of storm 
surges from outfall canals and navigation channels. Completing 
the Southeast Louisiana urban drainage project within the 
geographic perimeter of the Lake Pontchartrain and Vicinity and 
West Bank and Vicinity projects will enhance the effectiveness 
of interior drainage systems.
    Based on the proposed statutory language included in the 
President's Budget, local entities would be responsible for 35 
percent of the cost of the Southeast Louisiana project located 
within the geographic perimeter of the Lake Pontchartrain and 
Vicinity and West Bank and Vicinity projects, and for 35 
percent of the increment of levee raises and other enhancements 
needed to the Lake Pontchartrain and Vicinity and West Bank and 
Vicinity projects above currently authorized levels to reduce 
the risk to the greater New Orleans area from storm surges that 
have a 1 percent annual chance of occurring. Local entities 
would also be responsible for 100 percent of the operation, 
maintenance, repair, replacement, and rehabilitation cost.


                        other budget highlights


General Provisions
    The Budget includes proposed statutory language to 
authorize continuation of limits on reprogramming with certain 
proposed changes; to replace the continuing contract authority 
of the Corps with multi-year contracting authority patterned 
after the authority available to other Federal agencies; and to 
prohibit committing funds for ongoing and new contracts beyond 
the appropriated amounts available, including reprogramming.
Improved Cost Estimating
    With my full support, the Chief of Engineers is undertaking 
several initiatives to strengthen the Corps performance in 
project cost estimating. The Chief will discuss these 
initiatives in detail in his statement.


                water resources development act of 2007


    Upon passage of WRDA 2007 on November 7, 2007, the Chief of 
Engineers and I established a joint team to oversee the 
implementation of this lengthy, complex, and costly Act. We 
have designated a senior Corps policy analyst to lead our joint 
efforts. I meet at least bi-weekly with the joint WRDA 
implementation team to review and approve guidance for major 
policy and project provisions of WRDA.
    The purpose of implementation guidance is to ensure a 
common understanding of the policies and procedures that will 
be used to meet the requirements of the law. Provisions that 
require development of implementation guidance are being 
identified and prioritized, and the writing of the guidance is 
underway. Implementation guidance for those provisions directly 
affecting work within the Divisions and Districts is being 
developed in consultation with the appropriate District, 
Division, and Headquarters Regional Integration Team. Due to 
the large number of provisions in the law, it will take time to 
issue guidance on each of the provisions. Priority for 
implementation guidance is being given to national policy 
provisions (mostly in Title II) and to those project and 
program provisions where funds are currently appropriated.
    Following are some examples of WRDA provisions receiving 
priority for implementation guidance:
    Section 2003--Written Agreements for water resources 
projects
    Section 2027--Fiscal Transparency Report
    Section 2031--Water Resources principles and guidelines
    Section 2032--Water Resources priorities report
    Section 2033--Planning
    Section 2034-- Independent Peer Review
    Section 2035-- Safety Assurance Review
    Section 2036-- Mitigation for fish and wildlife and 
wetlands losses
    Title VI--Florida Everglades
    Title VII--Louisiana Coastal Area
    Title IX--National Levee Safety Program
    Working through the joint implementation team, we are 
making excellent progress in implementation strategies for the 
significant policy provisions and numerous individual project 
provisions.


                     president's management agenda


    The Army Civil Works program is pursuing 5 government wide 
management initiatives, as are other Federal agencies, plus a 
6th initiative on real property asset management. 
``Scorecards'' for the Army Corps of Engineers and other 
Federal agencies can be found at the following website: http://
www.whitehouse.gov/results/agenda/scorecard.html.
    For the first quarter of the 2008 fiscal year, the 
scorecard rates the Corps status as red on one initiative, 
yellow on 4, and green on one. I am pleased that the Corps is 
rated green on progress on all 6 initiatives. The Corps has 
worked diligently to achieve these ratings, and I am proud of 
their efforts. The Army is hopeful that the Corps of Engineers 
will receive an audit opinion in the very near future from the 
Inspector General of the Department of Defense for its fiscal 
year and 2007 Civil Works financial statements. This would be 
the first time ever that a major component of the Defense 
Department has received an audit opinion. The opinion is 
expected to be qualified, and it is anticipated that the 
auditors will recommend a number of areas that need 
improvement. With a qualified opinion in hand and this guidance 
from the DoD Inspector General, the Army has every expectation 
that the Corps can achieve an unqualified audit opinion on its 
fiscal year financial statements.


                               conclusion


    In developing this Budget, the Administration made explicit 
choices based on performance. The sustained level of O&M 
funding, transfer of activities from construction to O&M, 
emphasis on construction projects based on their returns, and 
focus on preparedness for flood, hurricane, and other natural 
disasters, for example, all reflect a performance-based 
approach.
    At $4.741 billion, the fiscal year Army Civil Works annual 
budget provides the resources for the Civil Works program to 
pursue investments that will yield good returns for the Nation 
in the future. With the proposed $5.761 billion in fiscal year 
emergency appropriations, the Corps can also complete the 
Federal share of work necessary to significantly reduce the 
risk of storm surge damage to the greater New Orleans area.
    This Budget represents the wise use of funding to advance 
worthy, mission-based objectives. I am proud to present it.
    Thank you, Madam Chair and members of the Committee, for 
this opportunity to testify on the President's Fiscal Year 2009 
Budget for the Civil Works program of the Army Corps of 
Engineers. This is the last time I will appear before this 
Committee to present the Civil Works budget on behalf of 
President Bush. It has been my pleasure working with this 
Committee.


[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


                              ENCLOSURE 3

                         DEPARTMENT OF THE ARMY

                 CORPS OF ENGINEERS--CIVIL WORKS BUDGET

               FY 2009 CONSTRUCTION PERFORMANCE GUIDELINES

    1. Project rankings. All ongoing specifically authorized 
construction projects, including projects funded in the 
Mississippi River and Tributaries account, will be assigned 
based upon their primary purpose to one of the main mission 
areas of the Corps (flood and storm damage reduction; 
commercial navigation; aquatic ecosystem restoration) or to 
hydropower. Flood and storm damage reduction, commercial 
navigation, and hydropower projects will be ranked by their 
total benefits divided by their total costs (BCR), calculated 
at a 7 percent real discount rate. Aquatic ecosystem 
restoration projects will be ranked by the extent to which they 
cost-effectively contribute to the restoration of a nationally 
or regionally significant aquatic ecosystem that has become 
degraded as a result of a civil works project, or to a 
restoration effort for which the Corps is otherwise uniquely 
well-suited (e.g., because the solution requires complex 
alterations to the hydrology and hydraulics of a river system).
    2. Projects funded on the basis of their economic and 
environmental returns. Ongoing flood and storm damage 
reduction, commercial navigation, and hydropower construction 
projects with a BCR of 1.5 or higher and ongoing aquatic 
ecosystem restoration construction projects that are cost-
effective in contributing to the restoration of a nationally or 
regionally significant aquatic ecosystem that has become 
degraded as a result of a civil works project or to a 
restoration effort for which the Corps is otherwise uniquely 
well-suited will receive at least the amount needed to pay 
estimated contractor earnings required under ongoing contracts 
and related costs. In allocating funds among these projects, 
priority will be given to those with the highest economic and 
environmental returns and to projects where the Corps can 
complete physical construction of the project and/or related 
administrative activities in the budget year.
    3. Projects funded to address significant risk to human 
safety. Flood and storm damage reduction projects that are 
funded to address significant risk to human safety will receive 
sufficient funding to support an uninterrupted effort during 
the budget year.
    4. Projects with low economic and environmental returns. 
Ongoing flood and storm damage reduction, commercial 
navigation, and hydropower construction projects with a BCR 
below 1.5 will be considered for deferral, except for flood and 
storm damage reduction projects that are funded to address 
significant risk to human safety. Likewise, ongoing aquatic 
ecosystem restoration construction projects that do not cost-
effectively contribute to the restoration of a nationally or 
regionally significant aquatic ecosystem that has become 
degraded as a result of a civil works project, and do not cost-
effectively address a problem for which the Corps is otherwise 
uniquely well-suited, will be considered for deferral.
    5. New starts and resumptions. The budget could include 
funds to startup new construction projects, or to resume work 
on ongoing construction projects on which the Corps has not 
performed any physical work under a construction contract 
during the past 3 consecutive fiscal years, only if the project 
would be ranked that year in the top 20 percent of the ongoing 
construction projects in its mission area. The term ``physical 
work under a construction contract'' does not include 
activities related to project planning, engineering and design, 
relocation, or the acquisition of lands, easements, or rights-
of-way. For non-structural flood damage reduction projects, 
construction begins in the first fiscal year in which the Corps 
acquires lands, easements, or rights-of-way primarily to 
relocate structures, or performs physical work under a 
construction contract for non-structural project-related 
measures. For aquatic ecosystem restoration projects, 
construction begins in the first fiscal year in which the Corps 
acquires lands, easements, or rights-of-way primarily to 
facilitate the restoration of degraded aquatic ecosystems 
including wetlands, riparian areas, and adjacent floodplain, or 
performs physical work under a construction contract to modify 
existing project facilities primarily to restore the aquatic 
ecosystem. For all other projects, construction begins in the 
first fiscal year in which the Corps performs physical work 
under a construction contract.
    6. Other cases. Projects will receive the amount needed to 
ensure that they comply with treaties and with biological 
opinions pursuant to the Endangered Species Act, and meet 
authorized mitigation requirements. Dam safety assurance, 
seepage control, and static instability correction projects 
that are funded in the construction program will receive the 
maximum level of funding that the Corps can efficiently and 
effectively spend in each year.

      Responses by John Paul Woodley Jr. to Additional Questions 
                           from Senator Bond

    Question 1. In regards to the drainage deficiencies at the 
L-385 levee at Riverside MO. There was a flood on the Missouri 
River in May 2007; following this flood the levee district 
inspected the gate wall pipes as part of their routine 
maintenance. Problems were noted in several locations. The 
Corps has planned to install seals where the joints have failed 
and are due to be installed prior to April 1, 2008. The local 
sponsor has objected that they should not be responsible for 
the cost of the repair because they have already paid for the 
design and construction. However, the Corps concluded that the 
repair is subject to cost share even if it is determined to be 
a design or construction deficiency. What time table has the 
Corps set to determine the cause of the pipe failures? If it is 
deemed a design deficiencYt why will the non-Federal investor 
be penalized for a Corps mistake? I also request that the Corps 
do a complete evaluation of the entire project to see if any 
other features are not working properly prior to the local 
sponsor taking over the operation and maintenance of this 
important flood control project.
    Response. Seals have been installed at all the failed 
joints and the pipes are now fully functional. This effort was 
completed March 19. In addition the Corps has initiated a 
thorough investigation to determine the cause of these 
failures. The investigation will be conducted by an Architect 
Engineer (AE) firm and completed in September 2008. At that 
point the Corps will be able to determine whether it is a 
design construction or material deficiency and will take the 
appropriate follow-on action. If further corrective action is 
required the estimated cost for that action will also be 
available at that time.
    I understand the sponsor's concern about sharing the cost 
of the repair. However this is a post-WRDA 86 cost shared 
project subject to the applicable cost-sharing provisions of 
the law. The Corps is required by law to follow the cost 
sharing requirements set forth therein.
    With regard to a complete evaluation of the entire project 
the Corps and the sponsor have completed an inspection of all 
structures. All levee features are fully functional and no 
other deficiencies were found. Although the sponsor has not 
officially taken over the project, the sponsor has been 
operating and maintaining the project since 2005.

      Responses by John Paul Woodley Jr. to Additional Questions 
                           from Senator Boxer

    Question 1. Since WRDA 2007 became law on November 8, 2007, 
insufficient progress has been made on the programmatic changes 
known collectively as Corps Reform. While the law was enacted 
on November 8, the conference report was filed on August 31. 
The Corps and the Secretary's office have had over 7 months to 
know what the new requirements would look like. Two of the most 
significant of the programmatic changes, independent review and 
improvements in the mitigation program, became effective upon 
enactment and certainly came as no surprise since similar 
language was in both chambers' bills. How are you implementing 
the requirements to include specific mitigation plans in 
project study reports--requirements that include mitigation 
success criteria, monitoring responsibilities, a description of 
lands to be acquired, and contingency plans should initial 
mitigation efforts fail?
    Response. The Corps of Engineers is conducting a gap 
analysis on Section 2036(a) of WRDA 2007 requirements; the new 
Regulatory Mitigation Rule, which was published in the Federal 
Register on April 10, 2008; and applicable Civil Works Planning 
policies to identify those areas where the Civil Works program 
may need modification to comply with the mitigation standards 
and policies of the regulatory program. Detailed implementation 
guidance to correct any deficiencies will be developed based on 
the identified gaps. The gap analysis is scheduled to be 
completed by May 23, 2008. The gap analysis will be used to 
develop implementation guidance. Implementation guidance will 
be developed based on the resulting recommendations and should 
be completed by July 31. Any significant issues identified may 
result in interim guidance until resolution.

    Question 2. Has implementing guidance been issued? If not, 
when will it be? If so, please provide a copy.
    Response. The implementing guidance has not been issued. 
Implementation guidance will be developed based on the 
recommendations arising from the gap analysis and should be 
completed by July 31, 20008. Any significant issues identified 
may result in interim guidance until resolution. We will 
provide you a copy of the implementing guidance when completed.

    Question 3. How many projects studies have been modified to 
reflect the new requirements? Specifically list each project 
and how it has been modified. If projects have not been 
modified, why not?
    Response. The Corps of Engineers is currently gathering 
data from district offices on ongoing project studies that 
include or will include mitigation and whether or not the 
project studies have been modified to reflect the new 
requirements. Due to the effort required to respond, the 
comprehensive list will be provided as soon as possible.

    Question 4. Are there studies that include mitigation that 
have been completed or noticed for public comment since WRDA 
1907 was enacted? Please identify the studies. Have they 
complied with the new law?
    Response. The Corps of Engineers is currently gathering 
data from district offices on ongoing project studies that 
include or will include mitigation. Due to the effort required 
to respond, the comprehensive list will be provided by the end 
ofJune.

    Question 5. Section 2036(b) ofWRDA 1907 requires that a 
status report on mitigation be submitted concurrent with the 
submission of the budget request. Has that status report been 
submitted? When will it be?
    Response. The Corps of Engineers is currently gathering 
data on the major elements ofSection 2036(b) including the 
status of mitigation for all projects under construction, all 
projects that have requested funding, and all, projects that 
have undergone construction or completed construction but not 
completed mitigation. An interim status report based on this 
data will be provided to you by the end of June 2008. In 
addition, the Corps of Engineers is developing a data base and 
protocols for data collection in order to submit a more 
detailed status report with the next budget.

    Question 6. Section 2034 of WRDA 1907 requires independent 
review of projects meeting certain criteria, and it includes a 
look back to studies initiated up to 2 years ago. For what 
projects have you initiated independent reviews? What are your 
plans to initiate independent reviews?
    Response. USACE has had independent peer review guidance 
for project feasibility studies formally in place since May, 
2()05 (EC 1105-2-408), and a number of independent external 
reviews have been completed since that time. The Corps is 
currently in the process of consolidating and upgrading all of 
its Civil Works product review guidance with new policy to 
cover all work from feasibility studies through design, 
construction and operations and maintenance programs. The new 
review policy will comply with Section 2034 and Section 2035 of 
WRDA 2007; Section 515 ofPublic Law 106-554 (referred to as the 
``Data Quality Atoll); and the Final Information Quality 
Bulletin for Peer Review by the Office ofManagement and Budget. 
This will strengthen the quality and reliability ofCorps 
studies, designs and projects by adjusting and supplementing 
our current review processes. Section 2034 of WRDA 2007 
identifies some potential exemptions from external review for 
routine actions that may be expensive but routine (such as 
replacing hydropower turbines in place, etc.). The Corps has 
not exercised any exemptions to date.

    Question 7. How many projects currently under study are 
subject to the requirements of section 2034 for there to be 
independent review? Provide the Committee a list of project 
studies subject to the independent review provision.
    Response. [continuing]. USACE currently has 63 General 
Investigation studies slated for independent external peer 
review. The attached list is comprised of efforts that have 
been confirmed and approved by the respective Major Subordinate 
Commands (Corps Division offices). This list is not all 
inclusive since we are in a dynamic environment, but it 
represents the firm list to date.

    Question 8. Do you have the resources in the budget to 
accomplish the independent reviews? Your request for 
independent reviews in the Investigations account lists only $1 
million.
    Response. The amount budgeted for independent peer reviews 
represents a careful consideration of all the competing 
budgetary requirements and was deemed to sufficiently cover 
those studies included in the Budget. Should additional funds 
be required during fiscal year or fiscal year 9, funds will be 
sought from within study allocations or possibly through 
reprogramming, is excess funds available for this purpose can 
be identified.

    Question 9. In developing the independent review section, 
the conferees worked very hard to ensure that any potential 
delays in the study process were eliminated or minimized. Will 
your delay in implementing WRDA 1907 cause delays in completing 
studies, including independent reviews?

    Response. Provisions for incorporating independent review 
into the Corps study process and scheduling have been in place 
since May 2005 (EC 1105-2-408). Strategies for review are part 
of each study's Project Management Plan (PMP), and are designed 
to avoid any added delays due to review. Inevitably studies' 
schedules may change for a variety of reasons including review, 
but there is no systematic effect of independent review 
delaying study completion. Section 2034 of WRDA 2007 changed 
the cost sharing for independent review to be fully Federal (up 
to $500K) which may lead to a funding constraint until fiscal 
year when this requirement will be incorporated into the normal 
process. Should additional funds be required during fiscal year 
or fiscal year 9, normal budgetary procedures requiring close 
cooperation between the Congress and the Administration to fund 
the newly enacted provisions will be used to seek funds where 
independent external peer review funds have not been 
appropriated.

    Question 10. Section 2031 of WRDA 1907 requires a revision 
of the planning principles and guidelines which the Corps uses 
to develop project recommendations.
    What is the status of the revisions? Will the revisions be 
completed within the 2 years required by law?
    Response. We have already initiated revision of the 
Principles and the Standards (Chapter 1 of the current 
GuideliJ;le). The Principles and Standards focus on the basic 
water resources planning process including the national 
objectives that drive choices among alternative plans. We 
intend to finish revising the Principles and Standards by 
November of this year. I have also directed the Corps to 
initiate a survey of needs for revising the remaining segments 
of the current Principles and Guidelines. This segment contains 
the Procedures in Chapters II through IV of the current 
Guidelines on how to evaluate the benefits of water resources 
projects. Revising these Procedures is a matter of considerable 
scope and detail; a greater effort will be required for 
revising the Procedures than for revising the Principles and 
the Standards. The Corps survey of Procedures will include a 
schedule and cost estimate for completing revision of these 
Procedures. We will make every effort to meet the 2 year 
statutory requirement.

    Question 11. Do you have the necessary resources dedicated 
in the budget to accomplish the revisions in the time called 
for?
    Response. For the present effort of revising the Principles 
and Standards, we have dedicated sufficient resources within 
our available General Expense appropriation.

    Question 12. What steps are you taking to ensure 
consultation with other Federal agencies, as required, and what 
steps are you taking to solicit and consider public and expert 
comments?
    Response. I have notified the agency heads specified in 
Section 2031 seeking their suggestions for revising the P&S and 
I have requested their assistance in establishing staff 
designees to carry out the consultation requirements. On June 
5th, prior to release of draft revisions of the Principles and 
Standards, I will hold a meeting here in Washington with the 
interested public to hear their ideas for revisions to the 
Principles and Standards. We also will be taking written 
suggestions from the public. The Federal Register clerk has our 
notice for this meeting, and we are issuing a press release to 
publicize the meeting through the Corps Public Affairs Office.
    In addition we will be following prescribed procedures for 
vetting of guidance. When the draft revision is complete we 
will publish this draft on the Corps web site and place a 
notice in the Federal Register inviting public comments. We 
will receive comments for thirty days.
    With regard to receiving expert review and comments, our 
plan is to contract with a nationally recognized institution to 
establish a consulting committee of experts, and we're moving 
expeditiously to put that proposal in place through a contract. 
Our vision is that the institution with which we contract will 
hold a conference in early August where an in dependently 
chosen panel of experts will review the draft revision of the 
Principles and Standards. By that time the comments from the 
public review of the draft revision also will be available to 
the independent panel. Furthermore, this independent review 
panel conference will be open to the public and will provide an 
additional opportunity for water resources interests to 
participate in the process. Therefore, I am confident that the 
process we envision will solicit and fully consider expert 
review that is fully integrated with public participation.


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      Responses by John Paul Woodley Jr. to Additional Questions 
                          from Senator Inhofe

    Question 1. Secretary Woodley, last year's budget stated 
that we need to increase revenues into the Inland Waterways 
Trust Fund. This year's budget includes only the broad outlines 
sofa proposal-namely, moving from the current diesel tax to 
lockage fees yet your written testimony states that prompt 
enactment is needed. When will we see the actual proposal?
    Response. We expect to submit proposed legislative language 
to the Congress in April 2008.

    Question 2. Will the proposal be accompanied by any 
analysis of the impacts on users of the inland waterways system 
as a whole,'' as well as the impacts on users of different 
portions of the system?
    Response. The Corps has this information. We would be happy 
to provide it to the Congress.
    Question 3. The budget request includes funds for a 
National Portfolio assessment of water reallocation 
possibilities. One of the problems some of the communities in 
Oklahoma have run into is that even when there is available 
storage at, existing reservoirs, the Corps' policy on pricing 
that water supply storage makes it prohibitively expensive. How 
long has it been since this policy has been reevaluated?
    Response. First, let me explain the two different pricing 
methods under current policy. Both methods involve the 
administrative reallocation of water storage, which is 
authorized in and limited by the Water Supply Act of 1958, as 
amended.
    The first pricing method applies to existing storage that 
was authorized for water supply, but which has never been under 
contract. In these cases, the price is a proportional share of 
the original project cost, plus interest after a 10-year 
interest free period. This is intended to recover part of what 
it actually costs the Federal Government to construct the 
project, which was authorized to include storage for water 
supply from the beginning.
    The second pricing method applies to the reallocation of 
storage from one user to another or there assignment of the use 
of existing storage space from one use to another purpose, as 
in a transfer from flood control or hydropower to water supply. 
In these cases, the price is based on the highest of the 
following: the value of benefits forgone; the revenues forgone; 
the replacement cost; or the updated cost of construction.
    The pricing policy for the first method goes back to the 
Water Supply Act of 1958, which says the costs that the Federal 
Government incurs to provide storage for municipal and 
industrial water supply shall be paid by the beneficiaries of 
that storage. The pricing policy for the second method has been 
in effect since 1979. Also, a community may qualify for a 
reduction in price under either method, as provided in Section 
322 of the Water Resources Development Act of 1990.

    Question 4. Will you commit to working with me to see if we 
can improve this policy so that communities can afford the 
water supply storage opportunities the National Portfolio 
assessment may present?
    Response. We always are willing to reexamine policies to 
ensUre that they are in the national interest.

    Question 5. Sometimes on the other side of the issue, 
hydropower interests have expressed frustration with the Corps' 
policy of compensating them for lost generation due to 
reallocations. Will you work with me to see if we can find a 
compromise?
    Response. We are sensitive to the impacts that 
reallocations from hydropower storage may have on power 
production and the corresponding effects on the rates that the 
regional power administrations charge their customers. We also 
are sensitive to the water supply needs of the public, 
especially the needs of growing communities across the country. 
We attempt to balance power production and water supply needs 
to maximize the benefits that Corps projects provide. The 
current policy is to charge a water supply user an amount 
sufficient to compensate the regional power authorities for 
their lost revenues. The hydropower interests prefer 
compensation based on replacement costs, which is generally 
higher. We are willing to work with the Congress to identify 
other possible ways to address such competing uses of storage 
space in Corps reservoirs.

    Question 6. Secretary Woodley, as I have stated in previous 
hearings and meetings, I am very supportive of the concept 
mentioned in your testimony of allowing the Corps to use the 
fees it collects to operate, maintain and improve recreation 
opportunities. Unfortunately, we have consistently run into 
budget scoring problems that have prevented us from enacting 
such a proposal. Will you please commit to working with me to 
see if we can come up with other ways to accomplish this goal 
of improving recreation opportunities that don't have the same 
scoring hurdles?
    Response. Yes I will. However, the Administration's 
legislative proposal does not involve allowing the Corps to use 
the fees that it now collects. Generally, the Corps would spend 
the additional revenues in the fiscal year after it collects 
them. Therefore, our proposal would not have a significant net 
scoring impact over a 10-year period.

    Question 7. Could you please give more detail on 
implementation of Title 9 of WRDA 2007, the National Levee 
Safety Program? I am particularly interested in the estimated 
timeframe for receiving the recommendations from the Committee 
on Levee Safety.
    Response. On November 8, 2007, the Water Resources 
Development Act of 2007 (WRDA 2007) was enacted into law. Title 
IX of this WRDA is the National Levee Safety Act of 2007 (the 
Act). Section 9003 of this Title authorizes a Committee on 
Levee Safety (Committee), which would develop recommendations 
for a national levee safety program, including a strategic plan 
for implementing this program.
    The Committee would consist of 16 members. The Secretary of 
the Army and the Administrator of the Federal Emergency 
Management Agency, or their representatives, are two of the 
members. The Secretary of the Army would select the other 14 
members as provided in section 9003. The members have not yet 
been selected. However, we anticipate that it should take the 
Committee about 180 days to develop recommendations, counting 
from the date of its first meeting. Of course, the actual 
schedule will depend on the views of the members and the nature 
of their recommendations.
    In addition, section 9004 of Title IX authorizes the 
Secretary of the Army to inventory and inspect certain levees. 
The Corps has already begun this work using the $30 million in 
fiscal year supplemental appropriations that the Congress has 
previously provided.

      Responses by John Paul Woodley Jr. to Additional Questions 
                          from Senator Carper

    Question 1. As you know, chief among the WRDA 2007 reforms 
is the new requirement for independent review of all Corps 
projects that are controversial or valued at more than $45 
million. I've been a strong supporter of this requirement, 
which will improve the safety, quality, and environmental and 
fiscal soundness of water resources projects. Where is the 
Corps along the path to independent review compliance? Have any 
independent reviews been conducted yet? Are certain projects 
exempt from the independent review requirement? If so, which 
kinds? Could you provide this Committee with a comprehensive 
list of projects slated for independent review?
    Response. The Corps has had independent peer review 
guidance formally in place for project feasibility studies 
since May, 2005 (EC 1105-2-408), and a number of independent 
external peer reviews have been completed since that time. The 
Corps is currently in the process of consolidating and 
upgrading all of its Civil Works product review guidance with 
new policy to cover all work from feasibility studies through 
design, construction, and operation and maintenance. The new 
review policy will comply with Section 2034 and Section 2035 of 
WRDA 2007; Section 515 of Public Law 106-554 (referred to as 
the ``Data Quality Act''); and the Final Information Quality 
Bulletin for Peer Review by the Office of Management and 
Budget. This will strengthen the quality and reliability of 
Corps studies, designs and projects by adjusting and 
supplementing our current review processes. Section 2034 of 
WRDA 2007 identifies some potential exemptions from external 
review for actions that may be expensive but are routine (such 
as replacing hydropower turbines in place, etc.). The Corps has 
not exercised any exemptions to date.
    The Corps currently has 63 Investigation studies slated for 
independent external peer review. The attached list is 
comprised of efforts that have been confirmed and approved by 
the respective Major Subordinate Commands (Corps Division 
offices). This list is not all inclusive since we are in a 
dynamic environment, but it represents the firm list to date.

    Question 2. The costs of independent review are to be fully 
covered by the Federal Government and capped at $500,000. I 
want to know if the Corps was able to properly budget this 
year, given the new review requirement. Does the Corps 
understand they are to work the costs of independent review--
and fish and wildlife mitigation for that matter--into their 
project costs?
    Response. In these times of constrained budgets, the amount 
requested for independent peer reviews represents, a careful 
consideration of all the competing budgetary requirements. The 
fiscal year budget for the Civil Works program includes $1 
million for independent peer review of budgeted studies, which 
we determined was sufficient to cover those budgeted studies 
that would likely require peer review. In some cases, the 
amount budgeted for a specific study already includes an 
estimate for independent review. It is standard practice for 
study cost estimates to include funding for mitigation 
investigations, including funding for the Fish and Wildlife 
Service to conduct its Fish and Wildlife Coordination Act 
review.

    Question 3. I wish highlight the, growing concerns about 
the Port of Wilmington's capacity to store dredge material. I 
believe the situation at Wilmington reflects a nationwide 
problem of maintaining and enhancing our existing 
infrastructure to meet growing demand. The primary storage 
site--Harbor North--is closed and the Corps is currently 
looking for a new site. What does the Corps see as the long-
term plan for assuring adequate access to Port of Wilmington 
given the increasing siltation rates at the mouth of the 
Christina River?
    Response. The long-term plan for assuring adequate access 
to the Port of Wilmington requires the use of additional new 
dredged material disposal sites in the vicinity of the Port. 
Using funds added by Congress in .fiscal year 2008, the Corps 
is conducting a Dredged Material Management Plan to identify 
new disposal sites and establish a path forward to bring the 
sites on line. The management plan will include geotechnical 
analysis, designs, cost estimates, NEPA documentation, real 
estate requirements, and coordination with local, State and 
Federal agencies. The draft Management Plan is scheduled to be 
completed by September 2008.

    Question 4. While protecting the Gulf Coast is a clear 
priority, there are also a number of venerable areas along the 
East Coast that are threatened by catastrophic storms and sea 
level change. Is the Corps approaching its projects and 
priorities with due diligence paid to the increasing potential 
for sea level rise? If so, how?
    Response. Corps of Engineers current sea-level rise policy 
(published in 2000, developed in 1988) is being updated. The 
current policy directs that two specific rates of sea-level 
rise (a historic rate and a future projection) be considered in 
project planning and design. The future projection currently 
specified is based on the 1987 National Research Council 
report. This projection is generally considered to be extreme, 
even today, and is much greater than more recent projections by 
the Intergovernmental Panel on Climate Change (IPCC). 
Additionally, while the current policy directs studies to 
consider ``the risk associated with a substantial rise, it does 
not provide any guidance on how to consider that risk. The 
Corps currently is updating this guidance based on the findings 
presented in the 2007 IPCC Fourth Assessment Report. The 
updated sea-level rise policy will include more recent efforts 
to project future sea-level rise rates and will provide more 
detailed guidance on how to estimate sea-level rise for 
specific locations, how to properly incorporate these estimates 
in an economic analysis, and how to assess coastal 
vulnerability and risk from sea-level rise. This effort will 
include the National Oceanic and Atmospheric Administration 
(NOAA) and the U.S. Geological Survey (USGS).
    The Corps is in the process of analyzing other risks 
associated with climate change, which have varying levels of 
scientific uncertainty and/or impact on Corps missions. The 
Corps is collaborating with the U.S. Bureau of Reclamation, 
NOAA, USGS, and State and regional agencies to understand how 
climate change affects water resources and to develop planning 
processes to address the impacts. These efforts include studies 
in the Western United States to evaluate the observed trend to 
warmer temperatures and the associated changes in precipitation 
(snow vs. rain) and earlier spring runoff on flood risk, water 
supply, and ecosystems.

    Question 5. Since 1986, the Corps has been required to 
include a detailed mitigation plan for all civil works projects 
that have more than minimal adverse impacts. These directives 
have not been closely followed: A May 2002 GAO report found 
that the Corps failed to mitigate at all for 69 percent of 
projects constructed since 1986. WRDA 2007 fleshes out the 
requirements of a mitigation plan, and imposes additional 
requirements including monitoring and consultation. Could you 
please provide me with an update on the Corps' efforts to 
become compliant with the new mitigation requirements? Has the 
Corps begun consulting with State and Federal agencies 
regarding the progress of mitigation for each project?
    Response. The Corps of Engineers is conducting a gap 
analysis on Section 2036(a) requirements; the new Regulatory 
Mitigation Rule, which was published in the Federal Register on 
April 10, 2008; and applicable Civil Works Planning policies to 
identify those areas where the civil works program may need 
modification to comply with the mitigation standards and 
policies of the regulatory program. Detailed implementation 
guidance to correct any deficiencies will be developed based on 
the identified gaps. The gap analysis is scheduled to be 
completed by May 23, 2008. Implementation guidance will be 
developed based on the resulting recommendations and should be 
completed by July 31. Any significant issues identified may 
result in interim guidance until resolution.
    The Fish and Wildlife Coordination Act (FWCA) is the 
vehicle by which Federal agencies (USFWS, NMFS) and State 
wildlife agencies use to comment on Corps projects. This also 
includes mitigation plans. Many USFWS recommendations under the 
FWCA concern mitigation needs and goals. Section 2036 requires 
a formal consultation process and the Corps is developing 
protocols for that process.


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    Senator Boxer. Thank you, sir. I will be asking you about 
that. We have enjoyed working with you all over there as well.
    General.

 STATEMENT OF LIEUTENANT GENERAL ROBERT VAN ANTWERP, CHIEF OF 
            ENGINEERS, U.S. ARMY CORPS OF ENGINEERS

    General Van Antwerp. Thank you, Madam Chair and 
distinguished members of the Committee. It is really an honor 
for me to be here before you this morning and testify.
    Fiscal year 2007 and the first quarter of 2008 have been 
busy and challenging for the Corps. In addition to the subject 
of this hearing, in our military programs, our program with 
Base Realignment and Closure, Grow the Force and Restation the 
Force has had such things as $2 billion, $3 billion at some of 
our installations. I think we are seeing a re-facing of our 
installations across the Army. So we are privileged to be a 
part of that.
    Now, in civil works, as we look back, just to take a 
glimpse, we have completed 10 navigation projects in 2007. This 
particular budget here completes 12 projects in 2009. We 
restored over 5,000 acres under ecosystem restoration, dredged 
175 channels, 368 million visitor days at our recreation sites, 
supported FEMA in response to 10 national disasters and 
processed over 87,000 permits.
    So as we look forward to the Fiscal Year 2009 budget, it is 
a performance-based budget. It reflects the focus on projects 
and priorities that provide the highest net economic and 
environmental returns and/or addresses significant risks to 
human safety. It allocates funding for 79 projects for 
construction. It includes 11 dam safety projects, 16 life 
safety, and as I said, completes 12 projects in Fiscal Year 
2009.
    One of the emphases we will have in the Corps this year, 
and as this budget in 2009 reflects, is in the cost-engineering 
improvement area. We are really working hard to improve our 
cost estimates and accuracy of those costs as we go through the 
development process. We've stood up an independent review of 
cost estimates by a center of expertise in the Walla Walla 
District.
    Finally, I'd like to say that the Corps is a very 
expeditionary force. Today we have over 800 civilians deployed. 
We have four districts, three in Iraq and one in Afghanistan. 
We have many heroes out there that are doing wonderful things 
for the Country.
    Then finally, I want to State our commitment to continuous 
improvement. We are moving on what we call good to great, 
stealing from a great author who wrote the book, Good to Great. 
But it is where we want to go as a Corps. That means we have to 
deliver quality, we have to continuously improve and 
incorporate lessons learned, be good stewards and team with our 
cost-sharing partners.
    That concludes my statement, and I look forward to taking 
questions.
    [The prepared statement of Lieutenant General Antwerp 
follows:]

     Statement of Lieutenant General, Robert Van Antwerp, Chief of 
                Engineers, U.S. Army Corps of Engineers

    Madam Chair and distinguished members of the Committee, I 
am honored to be testifying before your committee today, along 
with the Assistant Secretary of the Army (Civil Works), the 
Honorable John Paul Woodley, Jr., on the President's Fiscal 
Year 2009 (FY09) Budget for the United States Army Corps of 
Engineers' Civil Works Program.
    My statement covers the following 4 topics:

     Summary of fiscal year Program Budget,
     Construction Program
     Cost Engineering Improvements, and,
     Value of the Civil Works Program to the Nation's Economy, 
and to the Nation's Defense


                 summary of fiscal year program budget


Introduction
    The Fiscal Year 2009 Civil Works Budget is a performance-
based budget, which reflects a focus on the projects and 
activities that provide the highest net economic and 
environmental returns on the Nation's investment or address 
significant risk to human safety. Direct Program funding totals 
$5.242 billion, consisting of discretionary funding of $4.741 
billion and mandatory funding of $501 million. The Reimbursed 
Program funding is projected to involve an additional $2 
billion to $3 billion. In addition, the Budget requests $5.761 
billion of emergency funding for continuing efforts to improve 
storm protection for the greater New Orleans area.
Direct Program
    The Budget reflects the Administration's commitment to 
continued sound development and management of the nation's 
water and related land resources. It proposes to give the Corps 
program managers more flexibility to properly maintain our key 
facilities. The Budget incorporates objective performance-based 
metrics for the construction program, funds the continued 
operation of commercial navigation and other water resource 
infrastructure, provides significant funding for the regulatory 
program to protect the Nation's waters and wetlands, and 
supports restoration of nationally and regionally significant 
aquatic ecosystems, with emphasis on the Florida Everglades and 
the Upper Mississippi River. It also would improve the quality 
of recreation services through an expanded fee structure and 
stronger partnerships, in support of modernization. 
Additionally, it emphasizes the basic need to fund emergency 
preparedness activities for the Corps as part of the regular 
budget process.
Reimbursed Program
    Through the Interagency and Intergovernmental Services 
Program we help non-DOD Federal agencies, state, local, and 
tribal governments, and other countries with timely, cost-
effective implementation of their programs. Rather than develop 
their own internal workforce to oversee large design and 
construction projects, these agencies rely on Corps of 
Engineers capabilities. Such intergovernmental cooperation is 
effective for agencies and the taxpayer by using the skills and 
talents that we bring to our Civil Works and Military Program 
missions. The work is principally technical oversight and 
management of engineering, environmental, and construction 
contracts performed by private sector firms, and is totally 
financed by the Agencies we service.
    Currently, we provide reimbursable support for about 70 
other Federal agencies and several State and local governments. 
Total reimbursement for such work in fiscal year is projected 
to be $2.0 billion to $3.0 billion. The exact amount will 
depend on assignments received from the Agencies.


                          construction program


    The goal of the construction program is to produce as much 
value as possible for the Nation from available funds. Our 
Fiscal Year 2009 Budget of $1.478 billion (including $76 
million under the Mississippi River and Tributaries program) 
furthers this objective by giving priority to the continued 
construction and completion of those water resources projects 
that will provide the best net returns on the nation's 
investment for each dollar invested (Federal plus non-Federal) 
in the Corps primary mission areas. The Budget also gives 
priority to projects that address a significant risk to human 
safety, notwithstanding their economic performance. Under these 
guidelines, the Corps allocated funding to 79 construction 
projects, including 11 other dam safety assurance, seepage 
control, and static instability correction projects, 16 
projects that address a significant risk to human safety, and 
52 other projects.
    The Budget uses objective performance measures to establish 
priorities among projects and, through a proposed statutory 
change in Corps contracting practices, would also increase 
control over future costs. The performance measures used 
include the benefit-to-cost ratios for projects with economic 
outputs; and, for aquatic ecosystem restoration projects, the 
extent to which the project cost-effectively contributes to the 
restoration of a nationally or regionally significant aquatic 
ecosystem that has become degraded as a result of a Civil Works 
project or to an aquatic ecosystem restoration effort for which 
the Corps is otherwise uniquely well-suited. The selection 
process also gives priority to dam safety assurance, seepage 
control, static instability correction, and to projects that 
address a significant risk to human safety. Under each of these 
criterions, resources are allocated based on performance. This 
approach significantly improves the realization of benefits to 
the Nation from the Civil Works construction program and will 
improve overall program performance by allowing the Nation to 
realize the benefits of the projects with the best net returns 
(per dollar invested) sooner.
Maintenance Program
    The facilities owned and operated by, or on behalf of, the 
Corps of Engineers are aging. As stewards of this 
infrastructure, we are working to ensure that its key features 
continue to provide an appropriate level of service to the 
Nation. Sustaining such service poses a technical challenge in 
some cases, and proper maintenance is becoming more expensive 
as this infrastructure ages.
    The Operation and Maintenance (O&M) program for the fiscal 
year Budget includes $2.638 billion (including $163 million 
under the Mississippi River and Tributaries program), with a 
focus on the maintenance of key commercial navigation, flood 
and storm damage reduction, hydropower, and other facilities. 
Specifically, the operation and maintenance program supports 
completed works owned or operated by the Corps of Engineers, 
including administrative buildings and laboratories. This 
program includes, for example, significant funding for our 
efforts in the Columbia River Basin and Missouri River Basin to 
support the continued operation of Corps of Engineers multi-
purpose projects by meeting the requirements of the Endangered 
Species Act. Other work to be accomplished includes dredging, 
repair, aquatic plant control, removal of sunken vessels, 
monitoring of completed coastal projects, and operation of 
structures and other facilities, as authorized in the various 
River and Harbor, Flood Control, and Water Resources 
Development Acts.


                     cost engineering improvements


    The Corps has implemented some cost engineering 
improvements in an effort to ensure the development of quality 
project estimates in support of our Civil Works customers and 
partners for the successful accomplishment of projects. Three 
initiatives have been implemented that will provide more 
reliable project recommendations at the feasibility phase of 
the project by developing project cost contingencies using a 
standard cost risk analysis program. Cost risk analysis is the 
process of identifying and measuring the cost impact of project 
uncertainties and risks on the estimated total project cost.
    The first initiative mandates that the National Planning 
Centers of Expertise coordinate with the Cost Engineering 
Directory of Expertise at the Walla Walla District for 
independent review of cost estimates, and include contingencies 
in all decision documents requiring congressional 
authorization. This approach will provide consistency in 
business practices and in the use of cost engineering tools.
    The second initiative, which went in effect on October 1, 
2007, requires that Corps project delivery teams conduct a cost 
risk analysis to develop contingencies for Civil Works total 
project cost estimates of all decision documents requiring 
congressional authorization for projects exceeding $40 million.
    The third initiative requires that project managers and 
their project delivery teams use project risk management 
principles and methods in developing a project risk management 
plan that includes a risk assessment and analysis and a risk 
response plan to support the cost risk analysis. Together the 
project risk management plan along with the cost risk analysis 
will produce a defensible assessment of the Civil Works total 
project cost estimate. This gives the management team an 
effective tool to assist in managing the planning study and 
will assist decisionmakers in making project recommendations.
    The Corps will be incorporating lessons learned into its 
cost estimating practices on an ongoing basis. Our goal is to 
improve the accuracy of our cost estimates much earlier in the 
development of a proposed project--at the project formulation 
stage--in order to provide greater assurance in determining 
whether the alternatives that we are exploring are highly cost-
effective.


           value of the civil works program to the nation's 
                          economy and defense


    We are privileged to be part of an organization that 
directly supports the President's priorities of winning the 
global war on terror, securing the homeland and contributing to 
the economy.
The National Welfare
    The way in which we manage our water resources can improve 
the quality of our citizens' lives. It has affected where and 
how people live and influenced the development of this country. 
The country today seeks economic development as well as the 
protection of environmental values.
    Domestically, Corps of Engineers personnel from across the 
Nation continue to respond to the call to help re-construct and 
improve the hurricane and storm damage reduction system for 
southeast Louisiana. The critical work they are doing will 
reduce the risk of damage from future storms to people and 
communities.
    The Budget also includes a 2009 Emergency Appropriation in 
the amount of $5.761 billion for the Federal Share of 
additional funds needed to provide risk reduction from 
hurricane and storm surges for the greater New Orleans, 
Louisiana, area. These funds will be used to restore and 
complete construction of hurricane and storm damage risk 
reduction features into the Federal System. The Budget also 
proposes that the existing systems be authorized as a single, 
integrated project, and that cost-shares of this re-authorized 
project be made consistent with cost-shares that are applied 
nationally.
Research and Development
    Civil Works Program research and development provides the 
Nation with innovative engineering products, some of which can 
have applications in both civil and military infrastructure 
spheres. By creating products that improve the efficiency and 
competitiveness of the nation's engineering and construction 
industry and providing more cost-effective ways to operate and 
maintain infrastructure, Civil Works program research and 
development contributes to the national economy.
The National Defense
    Internationally, the U.S. Army Corps of Engineers continues 
to support the mission to help Iraq and Afghanistan build 
foundations for democracy, freedom and prosperity.
    I also want to recognize the many Corps of Engineers 
civilians--each of whom is a volunteer--and Soldiers who are 
providing engineering expertise, quality construction 
management, and program and project management in other 
nations. The often unsung efforts of these patriotic men and 
women contribute daily toward this nation's goals of restoring 
the economy, security and quality of life for all Iraqis and 
Afghans.
    In Iraq, the Gulf Region Division has overseen the 
initiation of more than 4,300 reconstruction projects valued in 
excess of $6.5 billion. More than 500 projects valued at $2.6 
billion are ongoing. These projects provide employment and hope 
for the Iraqi people.
    In Afghanistan, the Corps is spearheading a comprehensive 
infrastructure program for the Afghan national army, and is 
also aiding in important public infrastructure projects.


                               conclusion


    The Corps of Engineers is committed to staying at the 
leading edge of service to the Nation. We're committed to 
change that ensures an open, transparent, and performance-based 
Civil Works Program.
    Thank you, Madam Chair and Members of the Committee. This 
concludes my statement.

       Response by Robert Van Antwerp to an Additional Question 
                          from Senator Warner

    Question. For the Roanoke River Flood Control project, the 
Corps had budgeted $5 million in FY' 05 and FY 06. Then $8.3 
million in FY 07 and $10.16 million in FY 08. For FY 09, the 
Corps only budgeted $1.075 million. Can you assure the 
committee that the Roanoke River Flood Control project remains 
a viable project for the Corps and does the Corps expect the 
project to save property and lives?
    Response. Yes, sir. The Roanoke River, Upper Basin, 
Virginia project remains an economically viable and 
environmentally sound flood damage reduction project that can 
potentially save lives and reduce flood damage to properties. 
The $1.075 million funding level was the capability level of 
funding, or the most that the Corps could efficiently and 
effectively spend during FY 09.

        Responses by Robert Van Antwerp to Additional Questions 
                          from Senator Inhofe

    Question 1. General Van Antwerp, the Committee has noted 
for the last several years that the balance in the Harbor 
Maintenance Trust Fund continues to grow, even as many of our 
nation's ports are not operating at authorized depths due to 
lack of funding. The American Association of Port Authorities 
has estimated that at least $1.3 billion is needed for fiscal 
year 2009 for operation and maintenance activities that are 
funded through the Harbor Maintenance Trust Fund. Would you 
agree with that estimate?
    Response. Senator we agree that $1.3 billion is an estimate 
of what could be budgeted for these activities, in Fiscal Year 
2009 to maintain our coastal navigation projects. The 2009 
Budget effectively balanced the Corps' diverse portfolio 
ofCorps infrastructure projects, of which coastal navigation 
channels are a part.

    Question 2. What is the Corps' capability for fiscal year 
09?
    Response. The Corps' capability for maintenance of coastal 
navigation projects in fiscal year could be as high as $1.3 
billion, which includes additional dredging, dredged material 
placement site construction and maintenance, and jetty, 
breakwater and certain bridge maintenance. However, a number of 
external factors could reduce this capability estimate 
substantially, including natural events, the timing of 
appropriations bill passage, etc.

        Responses by Robert Van Antwerp to Additional Questions 
                         from Senator Voinovich

    Question 1. [Provide] a list of QM and CO backlog projects.
    Response. NOTE: Similar question from Rep. Boustany, 
Transportation and Infrastructure Hearing on deferred 
maintenance and similar questions from Visclosky QFR #60 on O&M 
backlog and similar answer.
    The Construction and O&M Backlog Tables are attached; 
however, this backlog listing of projects does not represent a 
prioritization of work either within the O&M account or among 
different accounts in the Corps. For instance, some of this 
backlog is relatively high priority whereas other work may be a 
lower priority relative to funding needs in other Corps areas.

    Question 2. [What is] the total that the Corps has spent on 
Katrina related projects. What would be the Corps objectives 
for working to decrease this backlog of projects?
    Response. Sir, the Corps has expended $2.7 billion on 
Katrina related projects. With the fiscal year Budget of $5.761 
billion in emergency appropriations the goal is to have100-year 
protection by the end of 2011. Some features that dentate 100-
year protection are scheduled to complete after 2011, including 
permanent pumps at the three outfall canals and features of the 
Southeast Louisiana interior drainage project. The work in 
Mississippi has been completed, other than administrative legal 
processes which could take a number of years due to the appeals 
process.

    Question 3. How much money is in the Hub or Maintenance 
Trust Fund?
    Response. The balance in the Harbor Maintenance Trust Fund 
as of January 31, 2008 (latest report available from Treasury) 
is $4.349 billion.

    Question 4. How much money has the Corps allocated to the 
Great Lakes in the fiscal year budget for dredging and what are 
the Corps capabilities for these dredging projects?
    Response. The table below lists the estimated Great Lakes 
Dredging in the fiscal year President's Budget and our 
capability by project. Please note that the amounts represent 
an illustrative distribution of funding that may change and 
should not be considered to be budget estimates. The total, 
illustrative, estimated funding for Great Lakes dredging in the 
Budget is $36,075,000, and the capability is $62,211,000 for 
all channels and harbors, regardless of size or commercial 
tonnage.


[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


        Responses by Robert Van Antwerp to Additional Questions 
                          from Senator Vitter

    Question 1. In 2007, the Corps of Engineers released a 
technical report on the alternatives for the outfall canals and 
pumping stations near Lake Pontchartrain. This technical report 
was required by section 4303 of the P.L. 110-28. This report 
discusses an option 280 to pump to the river, and provides 
discharges directly to the Mississippi River in Jefferson 
parish. Please further describe the advantages and operational 
effectiveness of option 2a.
    Response. It should be noted that the option to discharge 
directly to the Mississippi River in Jefferson Parish was not 
considered as a stand-alone solution because it does not 
satisfy the purpose of the project, which is to provide 
hurricane storm surge protection for the three outfall canals 
(17th Street, Orleans Avenue, and London Avenue), while not 
impeding evacuation of storm water. Therefore, the advantages 
and disadvantages and operational effectiveness of the option 
to discharge directly to the Mississippi River in Jefferson 
Parish were considered in addition to those of Option 2. The 
additional advantages and operational effectiveness for this 
option are listed below.

     Increases interior drainage capacity and reduces local 
flooding. The area of Jefferson Parish served by this diversion 
would have supplemental or redundant drainage capacity (local). 
It would also allow that area of Jefferson Parish to be less 
dependent on Orleans Parish drainage operations and from any 
dependence upon conditions in the 17th Street Canal.
     Reduces the required flow in 17th Street''Canal, which 
reduces the required canal size for Option 2 and the size of 
the pump station at Lake Pontchartrain for either Option 1 or 
Option 2 if constructed prior to a new pump station at or near 
the lakefront on 17th Street Canal.
     Provides potential for better floodplain management 
capability by subdividing the basin and providing operational 
flexibility between sub-basins. If an interconnection link 
between the 17th Street system and the new Jefferson Parish 
system is provided it would provide operational flexibility for 
both systems. Operational reliability and flexibility is 
increased because this diversion would allow for cross-parish 
pumping during emergencies in either Jefferson or Orleans 
Parish.
     Provides a mechanism for by-passing some of the;,lt7th 
Street Canal flow during construction of the deeper canal 
sections associated with Option 2. If this option were in place 
prior to construction of Option 2, then there would be 
additional flexibility to redirect flows during construction.
     However discharging interior drainage from Jefferson 
Parish to the Mississippi River is approximately three times as 
expensive as discharging the same amount of volume of water 
through the 17th Street Canal to Lake Pontchartrain.

    Question 2. Would combining option 2a with one of the 
technical options (in the report) provide the best technical 
alternative that would provide the most comprehensive flood 
control measures for Jefferson Parish compared to any of the 
other technical options (in the report) being utilized by 
itself?
    Response. The studies associated with this project have not 
considered ``the most comprehensive flood control measures for 
Jefferson Parish'', Alternative analysis has been more closely 
focused on the development of features for the Hurricane and 
Storm Damage Risk Reduction System for protection of the three 
outfall canals. The information generated and the conceptual 
studies performed to date cannot be extrapolated to determine 
the most comprehensive flood control measures for Jefferson 
Parish.

    Question 3. While the technical report evaluated option 2a 
only with option 2t the report also noted that 2a could be 
linked to option I as well since it may provide additional 
operational flexibility to option I. Therefore which of the 
technical options when combined with option 2a would provide 
the best technical option when combined. Which combination of 
option 2a with another technical option would be the best 
technically advantageous and more operationally effective 
option when combined?
    Response. Option 2a when combined with any of Option It 
Option 2, or Option 3t does not change the preliminary 
evaluation described in the Report to Congress for P.L. 110-28, 
Chapter 3, SEC 4303:

     Options I and 2 appear more technically advantageous over 
Option 3 because they are more effective in reducing risk of 
flooding. Option 3 results in a much longer line of protection 
against hurricane storm surge and therefore has more exposure 
to hurricane storm surge and a higher risk of overtopping.
     Option I could be more advantageous considering the 
engineering challenges and construction complexity of Option 2.
     Option 2 is generally more technically advantageous 
overall and may be more operationally effective than Option 1 
because it would have fewer pump stations that offers greater 
reliability and further reduces risk of flooding.
    Some of the reported advantages of Option 2A are associated 
with a smaller deepened canal; however with the construction 
issues associated with Option 2 those advantages would not be 
applicable to other options that did not include a deepened 
canal. Therefore advantages of reduced canal size associated 
with Option 2a would only be realized in combination with 
Option 2.
     However it must be also acknowledged that there are also 
disadvantages to Option 2. Namely that discharging interior 
drainage from Jefferson Parish to the Mississippi River is 
approximately two and one half times as expensive as 
discharging the same amount of volume of water through the 17th 
Street Canal to Lake Pontchartrain.

    Question 4. I understand the Corps of Engineers is also 
working on an economic analysis and an environmental analysis 
of the alternatives for the outfall canals and pumping stations 
near Lake Pontchartrain. When is the actual date of release of 
the upcoming Corps report(s) on the economic analysis and 
environmental analysis? Will the report also include the 
technical aspects the Corps analyzed as well?
    Response. As part of the National Environmental Policy Act 
(NEPA) process, the Corps of Engineers is investigating the 
effects of the proposed options on environmental and 
socioeconomic resources and preparing an Individual 
Environmental Report (IER 5). IER 5 is expected to be released 
to the public for comment in Mayor June, 2008. As part of the 
evaluation of alternatives, technical components of all 
considered alternatives are described in the report. IER 5 
references the Report to Congress cited above. A full economic 
analysis of the alternatives is not currently being conducted 
or planned.

    Question 5. After over 15 years since studying had begun, 
the Morganza to the Gulf project was finally authorized within 
Sec. 1001 of WRDA 2007. When did the Corps of Engineers come to 
the opinion that the cost for the Morganza to the Gulf project 
would exceed 20 percent of the number supplied to Congress in 
the context of the Water Resources Development Act of 2007 
conference?
    Response. It was in late 2007 that the Corps came to the 
opinion that the cost of the Morganza to the Gulf project would 
exceed 20 percent of the cost authorized in WRDA 2007. After 
Hurricanes Katrina and Rita, new hydraulic designs were 
developed using the updated surge models. With our focus being 
on determining new post Hurricane Katrina IOO-year elevations 
for New Orleans and vicinity, this analysis for Morganza to the 
Gulf region was not completed until late 2007. The analysis 
showed that the elevation of the levees and structures would 
need to increase by 8-12 feet to provide a IOO-year level of 
protection. This represents an increase of approximately 70 
percent over the elevations used to develop the cost estimates 
included in the feasibility study. Significant revisions were 
also made to the design criteria as a result of lessons learned 
during Hurricane Katrina. Revisions to the design criteria were 
not complete until late 2007.

    Question 6. During the hearing, Assistant Secretary Woodley 
said he did not believe the Corps of Engineers had a new cost 
estimate for the Morganza project, yet the Corps of Engineers 
has been holding up work moving forward on this project. How 
could the Corps of Engineers determine the project costs could 
exceed 20 percent of the authorized level without a revised 
cost estimate? How can the Corps of Engineers hold up work on 
the Morganza project when they did not have a new cost estimate 
on the Morganza project?
    Response. The Corps has not stopped working on the Morganza 
to the Gulf project. We are continuing to develop detailed 
designs for the Houma Lock and Floodgate Complex and will have 
completed 50 percent of the plans and specifications by mid 
summer 2008. A new project cost for the Morganza to the Gulf 
could not be developed until the new hydraulic data was 
available and the design criteria for 100-year protection had 
been revised to reflect the updated surge models. A new cost 
estimate is currently being developed for the Morganza to the 
Gulf project and the scheduled completion date is July 2008. As 
a result of the 70 percent increase in the required elevations 
of the levees and structures and the changes to the design 
criteria, we are confident that the total project cost 
authorized in WRDA 2007 will increase by more than 20 percent. 
Morganza to the Gulf was authorized in WRDA 2007 but a Record 
of Decision (ROD) has not been signed. Given the significant 
changes in project costs and benefits, we need to reaffirm that 
tMe project remains economically justified before we would 
proceed further with the project. Also, as a result of new 
hydraulics and revised design criteria, the potential 
environmental impacts associated with the project have changed 
significantly. A revised programmatic EIS documenting the new 
project footprint and revised environmental impacts will be 
needed before the ROD can be signed. The increased project cost 
will require congressional re-authorization but that would only 
be needed prior to exceeding the authorized cost. A post 
authorization change (PAC) report, scheduled for completion in 
the summer of 2009, will be prepared to support re-
authorization. Assuming that the project remains justified and 
with updated environmental information completed in the summer 
of 2009, the Corps could sign the ROD.

    Question 6. Instead of holding up the entire project, how 
could the Corps of Engineers move forward with aspects of the 
project which are ready to go, like the Houma Lock?
    Response. Since the Houma Lock is not a separable element 
of the Morganza to the Gulf project, the economics of the 
project will have to be reaffirmed and a revised programmatic 
EIS completed, including assessing site specific impacts of the 
lock, before we could sign the ROD. Funds will have to be 
appropriated for construction of the project before we could 
move forward to construction.

    Question 7. Why has the Environmental Impact Statement 
(EIS) work been halted with regards to the Houma Lock? Please 
supply citations for the law that backed such decisionmaking, 
the names of those who made such a determination, dates and any 
written communication (internal and external) that discussed 
and/or instructed the EIS work to be stopped.
    Response. We have not stopped working on the Environmental 
Impact Statement (EIS) for the Houma Lock and Floodgate 
Complex. As discussed above, a revised programmatic EIS will be 
prepared to document changed conditions and we are 
incorporating all constructible features into this document. 
Completion of the revised programmatic EIS is currently 
scheduled for the summer of 2009. Once the revised programmatic 
EIS has been completed and the ROD has been signed, all 
environmental clearances will in place to begin construction 
oft? Houma Lock and Floodgate Complex.

    Question 8. What solutions can the Corps of Engineers 
suggest that would still allow flexibility for the Corps by 
placing projects under one umbrella, but not increase the 
historic nonFederal cost share for either of the Lake 
Pontchartrain and Vicinity (LPV) project nor the Southeast 
Louisiana (SELA), so that it does not place an undue financial 
burden on Louisiana that is still struggling with hurricane 
recovery efforts?
    Response. A system authorization proposed by the 
Administration for Lake Pontchartrain and Vicinity (LPV), West 
Bank and Vicinity and Southeast Louisiana (SELA) would allow 
greater flexibility to adjust to changes in conditions; 
environmental factors; technical situations; the market; and 
the movement of funds already appropriated by Congress to 
project features or contracts that require additional funding. 
While working within the overall appropriations provided, a 
system authorization would facilitate programmatic management 
and optimum use of resources to design and construct a 
comprehensive, quality system and advance schedules to meet the 
operational goal of completing the system in the June 2011 
timeline. We will implement the project in accordance with cost 
sharing policy.

    Question 9. How many cubic yards of clay material will be 
needed to complete projects in the Hurricane Protection System? 
Do you anticipate finding and transporting enough clay material 
of appropriate quality to complete projects within the 2011 
time frame? If not, what?
    Response. The Hurricane and Storm Damage Risk Reduction 
System (HSDRRS) requires over 100 million cubic yards of borrow 
material, approximately 20 Superdomes worth, to build 350 miles 
of earthen levees throughout five parishes.
    The Corps is pursuing three alternatives to acquire borrow 
material: ``Government Furnished,'' which means the Corps 
identifies the borrow source location, investigates and 
approves the borrow material as suitable for use and acquires 
real eState interests over the land through the non-Federal 
sponsor; ``Contractor Furnished,'' which requires a 
construction contractor to provide their own borrow material 
from an approved site; and ``Supply Contracts'', under which 
supply contractors bid for task orders for the supply of borrow 
material for HSDRRS projects. A recently issued Sources Sought 
Inquiry yielded approximately 60 responses and identified 
potential suppliers with the capacity to deliver large 
quantities of clay for construction of HSDRRS projects.
    Applying this three pronged approach to the acquisition of 
borrow, and working in collaboration with the non-Federal 
sponsor, the Corps remains confident that the required 
quantities and delivery schedules can be met.

        Responses by Robert Van Antwerp to Additional Questions 
                         from Senator Lieberman

    Question 1. Clear, navigable waterways are vital to the 
economic health of Connecticut and dredging projects are needed 
to maintain access to our ports and New London submarine base. 
I am concerned that the President's budget only requests $1 
million in 2009 to develop the Long Island Sound Dredged 
Materials Management Plan (DMMP). This plan is essential to 
ensure that dredged materials are managed in an economically 
sound and environmentally responsible manner. Without adequate 
resources over the next few years, the DMMP will not be 
finished in time to meet the Environmental Protection Agency's 
deadline and the New London disposal site will be forced to 
close.
    The fiscal year President's budget requested $2.8 million 
and Congress appropriated $3.5 million in fiscal year for this 
work. What is the rational for the signification reduction in 
funds in fiscal year 09? What impact will ibis reduction have 
on the Army Corps' ability to complete the DMMP on time?
    Response. The Project Management Plan for the Regional 
Dredged Material Management Plan and Programmatic Environmental 
Impact statement for Long Island Sound, October 2007, 
identifies a funding need of $4.8 million through fiscal year 
09. The fiscal year appropriated amount of $3.525 million plus 
the fiscal year President's Budget amount of$1 million compares 
favorably ($4.8 million vs. $4.525 million) with the needs of 
the project through fiscal year 09. While the $4.525 is 
slightly less than the estimated amount through fiscal year 09, 
this is not expected to have an adverse impact on the schedule 
for completing the DMMP. Given the high defamed and keen 
competition for Operation & Maintenance funds, the preliminary. 
cost estimate for the DMMP and the early stage of the DMMP 
study at the time funds were budgeted for fiscal year 09, the 
requested budget amount of $1 million in fiscal year 09 was 
considered adequate.

    Question 2. I understand that Army Corps is beginning to 
look at entire ecosystems, rather than specific projects, when 
making assessments. I am concerned however, that environmental 
costs and benefits are not readily assessed in most 
construction funding decisions. When construction projects were 
prioritized in the fiscal year request, how much weighting was 
applied to environmental costs or benefits? What was the 
rationale for this weighting?
    Response. There is no explicit weighting that occurs during 
the budget prioritization process. Rather, environmental costs 
and benefits are incorporated into the plan formulation and 
evaluation process during the course of the feasibility study. 
During the pre-construction study process, interactions with 
other projects in the system and potential project effects on 
the environment are considered when evaluating alternative 
solutions to the various water resources problems. The Corps 
also considers any ecosystem benefits that a project would 
provide. The studies include consideration of the array of 
information necessary for compliance with the National 
Environmental Policy Act and numerous other environmental 
statutes. During design, the Corps continues to consider 
changed conditions and revise its cost estimates to incorporate 
current data. The costs of avoidance, minimization and 
mitigation of potential negative affects on the project and the 
costs of positive environmental features are included in the 
total project cost. These costs are part of the benefit/cost 
ratios which are one of several factors considered in making 
recommendations for funding. For flood damage reduction and 
navigation studies, another factor used in determining funding 
priorities was whether the project also produced ecosystem 
benefits and was a part of a more comprehensive watershed plan.

    Question 3. The fiscal year request for Operations and 
Maintenance was broken down into 21 watersheds. The fiscal year 
request allocates O&M funding by 54 sub watershed systems. What 
was the rationale or this change? What process was used to 
break down the 21 watersheds into 54 sub-watershed systems? For 
example, the U.S. Geological Survey identifies 10 specific 
subregions in the New England watershed, but the Army Corps 
budget is divided into a Northern New England subregion and a 
Southern New England subregion.
    Response. For Operation and Maintenance (O&M), the fiscal 
year and 2008 budgets proposed allocations on a regional basis, 
allocating funding by 21 watersheds identified by the U.S. 
Geological Survey's watershed and sub-watershed identification 
system.
    The fiscal year Budget proposes to allocate O&M funding on 
a more refined systems basis, still based on the USGS watershed 
and sub-watershed identification system. In order to more 
clearly identify the systems among which funding is allocated, 
the Budget proposes to allocate funding among 54 systems. These 
54 systems more closely align with how projects are managed in 
the watersheds.
    Funding operation and maintenance using this framework will 
increase efficiency in the O&M ofCivil Works projects. Managers 
in the field are encouraged to think systematically when 
assessing risks and establishing maintenance priorities early 
in the budget process. Also, they will be better able to adapt 
to uncertainties and better able to address emergencies, as 
well as other changed conditions over the course of the fiscal 
year, while remaining consistent with congressional 
appropriations decisions.

    Question 4. The Army Corps has recently revised the 
standards by which levees are considered safe, but has not 
provided local governments with the resources needed to meet 
these new requirements. This has presented a financial hardship 
for the local communities responsible for maintaining the 
levees and the homeowners needing flood insurance. For example 
the East Hartford levee in Connecticut historically met all of 
the requirements from the Army Corps but was deemed deficient 
under the new criteria. The local community had to pass a bond 
measure to finance work that was previously not required. Why 
has the Army Corps not provided greater financial assistance to 
local communities responding to these more stringent 
requirements? What is the Army Corps doing to help local 
communities bring their levees back into compliance?
    Response. In light of the problems experienced during 
Hurricane Katrina the Corps is more actively enforcing the 
requirements of levee maintenance. These requirements are 
consistent with the original Operation and Maintenance Manuals 
provided communities at completion of Federal projects with the 
exception of more stringent vegetation removal requirements. 
Strict enforcement of levee maintenance requirements is 
necessary to ensure projects provide the designed level of 
protection and minimize the risk to public safety. The 
operation and maintenance is a local responsibility under the 
original project cooperation agreement. The Corps will continue 
to inspect levee projects to identify maintenance deficiencies 
and work with owners to correct these deficiencies in a timely 
manner.

    Senator Boxer. Thank you very much.
    I will start off, I think we will each take 5 minutes.
    Let me say, I want to talk about Corps reform. And I 
understood, Mr. Woodley, that you were sort of saying not 
enough time, not enough time. Well, the law was enacted in 
November. The conference report was filed in August. And the 
Corps has now had over 7 months to know what the new 
requirements would look like. And two of the most significant 
of the programmatic changes, independent review and 
improvements in the mitigation program, became effective upon 
enactment and certainly were not surprise.
    So has implementing guidance been issued?
    Mr. Woodley. Senator, we already have a great deal of 
guidance in place covering independent review.----
    Senator Boxer. No, since the law, has new guidance been 
issued since the law was passed?
    Mr. Woodley. I don't believe we have yet issued our new 
guidance for peer review. But I know that we are certainly 
working very hard to do so.----
    Senator Boxer. OK, how many project studies have been 
modified to reflect the new requirements?
    Mr. Woodley. However many are required to be modified.
    Senator Boxer. Well, how many have already been modified?
    Mr. Woodley. I don't know, but----
    Senator Boxer. Do you have staff who could tell you how 
many? Any staff there that knows that, or sir, do you know 
that, Lieutenant General, how many project studies have been 
modified to reflect the new requirements of Corps reform, 
independent review and the mitigation program?
    General Van Antwerp. We will get you the number, but we are 
doing independent review on all our projects. We have 
thresholds, because we have our internal review and we have 
external review. But we are doing peer review on all of our 
projects today. We can get you the number and those specific 
projects. But we have incorporated that in.
    Senator Boxer. I understand. But my understanding from my 
staff, which Mr. Woodley praised and praised by both sides, is 
that it is not in conformance with the new law. Section 2036(b) 
of WRDA 2007 requires that a status report on mitigation be 
submitted concurrent with the submission of the budget request. 
Has that status report been submitted, sir? Sirs?
    Mr. Woodley. I don't believe so.
    Senator Boxer. OK. When will it be submitted? You are in 
violation of a law here.
    Mr. Woodley. I am sure we will get in compliance with it as 
soon as we possibly can.
    Senator Boxer. OK. Well, let me just say to colleagues, 
whether you like the law or you don't like the law, you have to 
follow the law. Or we are just a lawless society here. Now, 
Senator Feingold worked very hard on Corps reform. He wanted to 
take it way further than a lot of us were willing to go. 
Senator Inhofe and I worked very closely together to get to 
some place where we could all live with it. And you are not 
even doing that.
    So Section 2034 of WRDA 2007 requires independent review of 
projects meeting certain criteria, it includes a look-back to 
studies initiated up to 2 years ago. As far as I know, you 
haven't initiated any of these.
    Mr. Woodley. Senator, we have initiated that in every case, 
every single activity underway has been, is----
    Senator Boxer. So every----
    Mr. Woodley [continuing].--actively under review to 
determine its----
    Senator Boxer. But it is under your old guidance, not under 
the new guidance in the new law, is my understanding.
    Mr. Woodley. Well, it is being scrubbed, there is no new 
guidance, but we are operating under the law.
    Senator Boxer. Well, there is new guidance, it is called 
the law.
    Mr. Woodley. There is new guidance----
    Senator Boxer. Did you, when you----
    Mr. Woodley [continuing].--it is called the law. That is 
exactly right.
    Senator Boxer [continuing].--handed in your budget request, 
did you or did you not follow the law, which says, a status 
report on mitigation be submitted concurrent with the 
submission of the budget request? And you didn't do that.
    Mr. Woodley. I don't think we were able to get that done.
    Senator Boxer. Right. That is my point. Do you have the 
resources in the budget to accomplish the independent review 
and everything else you have to do under the new law?
    Mr. Woodley. Well, we certainly have included additional 
funding in the investigations account to cover the independent 
review for any project that didn't otherwise have it, and then 
that is an additional million dollar allocation that we got in 
the investigations account. As you know, that account has not 
been increased in our budget request for many years.
    Senator Boxer. Section 2031 of WRDA 2007 requires a 
revision of the planning principles and guidelines which the 
Corps uses to develop project recommendations. Where does that 
stand in the process? Where are you in that process?
    Mr. Woodley. I have created an interagency team to begin 
that process. I am preparing the schedule on that, and we are 
moving very aggressively to complete that.
    Senator Boxer. OK, well, if I could just close here, 
because my time is up and I will come back later, you are 
working off of the old, as I understand it, pre-Katrina rules 
in terms of independent review. And that is a problem. Because 
after Katrina, we all moved in a different direction here. So I 
am just a little bit befuddled by the lack of response, I am a 
little concerned about it. So I hope we can meet with you 
perhaps after this hearing is over, maybe you do need more 
resources and maybe you can't tell us. Maybe Senator Voinovich 
is right, that you just don't have enough to do the job you are 
supposed to do.
    But you didn't do what you were supposed to do in your 
budget request and it is disturbing to me. I will withhold my 
other questions until my second round.
    Senator Isakson.
    Senator Isakson. Thank you, Madam Chairman.
    Secretary Woodley, in my discussions and my staff's 
discussions with the staff at the Corps, as we were working 
toward this year, it was my understanding that staff 
recommendations were to include the Savannah expansion project, 
and it did not end up getting in the budget. Where was the 
decision made to not do Savannah in Fiscal Year 2009?
    Mr. Woodley. The decision was not a peculiar one to 
Savannah. The decision was to establish the criteria on which 
we would base our budgeting decisions, and Savannah did not 
meet one or more of those criteria. I believe there is still 
NEPA work underway that needs to be completed before we can 
proceed with Savannah. But I would have to be brought up to 
speed on that to be exactly sure what it is.
    Senator Isakson. General Van Antwerp is nodding his head. 
Is that correct?
    General Van Antwerp. I think I can add. We have funded this 
to the capability which is $700,000. It is to complete the 
Record of Decision which is scheduled for June 2009, completion 
of that Record of Decision.
    Senator Isakson. So if you would, Secretary Woodley or 
General Van Antwerp, whichever one is appropriate, if you could 
send me a communication to my office to let me know what 
criteria it is that Savannah needs to be able to be included in 
the next budget, which will be Fiscal Year 2010, I would 
greatly appreciate those points of criteria.
    I understand the inclusion of the completion of the Oakland 
Harbor in California. We in Georgia benefited from the Corps' 
commitment to complete Brunswick years ago. So I understand 
that. But I am equally very desirous of getting the Savannah 
enhancement project started, so that when the Panama Canal 
project is completed, we can remain the second largest port on 
the Eastern Seaboard, and I don't think anybody else can really 
take our place capacity-wise, anyway. So it is essentially in 
the best interest of the United States to do that.
    Secretary Woodley, with regard to the ACT and the ACF and 
the water control manuals that the Corps has committed to 
complete, is the money sufficient in this budget to do that 
process?
    Mr. Woodley. Yes, sir.
    Senator Isakson. On both of them?
    Mr. Woodley. I believe so, yes, sir.
    Senator Isakson. OK. Check, because if I believe so means 
maybe----
    Mr. Woodley. No, no. No, sir, I am not in doubt. That 
activity, we regard that as a very high priority activity 
within the operation and maintenance of those facilities on 
those two waterways or watersheds. Although I would have to 
look at the schedule, I don't know that we are budgeting in 
2009 to complete that process. However, we are budgeting fully 
to continue all activities associated with that process. I 
believe it is not able to be brought to full completion in 
2009, but that we are certainly fully funding our activity, 
because I agree with you and have long advocated the updating 
of those manuals to allow us to appropriately manage the 
Federal responsibilities on both of those watersheds.
    Senator Isakson. My understanding, I think you are correct, 
my understanding, and you all can correct me, is that this is 
really a 2-year project. My question obviously is, is there 
sufficient money to do this year's Fiscal Year 2009 in the, 
what should be, I guess there is enough money in the current 
2008 to begin the project and in 2009 to continue the project, 
and if necessary in 2010, there would need to be money to 
complete the project. So it is a 2-year project, 18 to 24 
months. It is also my understanding the Corps has brought in a 
person not previously affiliated with all this to oversee both 
of these water control plants, is that correct?
    Mr. Woodley. Yes, sir.
    General Van Antwerp. That is correct.
    Senator Isakson. So some time in the next 2 years, and we 
do have the person on board who is going to lead the charge?
    General Van Antwerp. Mr. Isakson, if I might just add, 
there is a 1.8 in this budget, Fiscal Year 2009, and then that 
leaves about 1.9 after 2009. But what is in the budget right 
now will take us through so we can be engaged throughout that 
time. But it is a two to 3 year process, largely because of the 
environmental part.
    Senator Isakson. Thank you, Madam Chair.
    Senator Boxer. Thank you, Senator.
    Senator Vitter.
    Senator Vitter. Thank you, Madam Chair. And thank you 
again, gentlemen, for all of your leadership and work.
    I want to go right to the three topics I enumerated in my 
opening statement. First, the additional funds for the 100 year 
level of protection. Again, thanks to the President, thanks to 
the Administration for that commitment.
    But I am concerned about timing. General, isn't it true 
that the original timeframe for that work was to complete it by 
2010, but that has now slipped to 2011?
    General Van Antwerp. I believe that is true. I know that 
the slippage, it is now, we are targeting the 2011 hurricane 
season, so the June timeframe.
    Senator Vitter. Now, Corps officials beneath you have said 
they need this money appropriated by the start of the fiscal 
year, October 1st, to stick to that timeframe, is that 
accurate?
    General Van Antwerp. That is accurate. We have looked at 
when we need to award contracts and put those contracts out. We 
need a good portion of this money right at the beginning of 
Fiscal Year 2009, October-ish.
    Senator Vitter. Great. General, do you know the last time 
Congress has acted on the Corps appropriation bill in a timely 
way by October 1st?
    General Van Antwerp. Not in memory, sir.
    Senator Vitter. In 1999. Do you know many times Congress 
has done that in the last 10 years? Once in the last 10 years.
    So given the obvious emergency nature and significance of 
this work, why are we asking for it in that model, which 
ensures, absolutely ensures, particularly in a Presidential 
election year, further slippage?
    Mr. Woodley. Perhaps I had better answer that, Senator. I 
can tell you that when we submit a budget, we do it on the 
assumption that it will be prepared and that there will be an 
appropriation by the beginning of our Fiscal Year and we plan 
our execution on that basis.
    I agree that it is becoming more rare than it ought to be.
    Senator Vitter. Mr. Secretary, let me suggest, this goes to 
the future of the New Orleans region, the survival of the New 
Orleans region. So why are we building assumptions in to our 
work that are patently false?
    Mr. Woodley. I do not have a good answer for that question, 
and I would say that if Congress does not intent to complete 
this process within the current Fiscal Year that alternate 
provisions should be made in order to ensure that no delays are 
experienced on the ground.
    Senator Vitter. It is true, is it not, that this is being 
requested as emergency spending not under the cap?
    Mr. Woodley. That is correct.
    Senator Vitter. So for all these reasons, I believe we 
should clearly move this to the supplemental, which presumably 
will happen sooner. And my second concern under this category 
is the cost shares. As you know, components of this work are 
being requested by the Administration at a higher cost share to 
the State, at a more demanding cost share to the State than 
ever before. SELA is normally 75/25 Federal/State. You are 
asking 65/35. Lake Pontchartrain vicinity is normally 70/30 
Federal/State. You are asking 65/35.
    After we have gone through Katrina and Rita, why would you 
make the cost share more demanding rather than at least stick 
to the historical cost share or even offer some additional 
help?
    Mr. Woodley. You remember that the cost share applies only 
to that portion of the work that is in excess of what had 
previously been, prior to Katrina, had been authorized by 
Congress. So the vast majority of the work being undertaken is 
being undertaken at full Federal expense. I think that is 
entirely appropriate and I agree with that.
    The issue of cost share being more demanding is really 
related to another issue, which is the absolute imperative that 
I feel to operate, plan, authorize and manage the construction 
and the ongoing operation and maintenance of this set of works 
as a single system. The great lesson, if we have a lesson, of 
Katrina is that is what was not done. So we had a series of 
fragmented works that were done to different standards and that 
sort of thing.
    Senator Vitter. Mr. Secretary, you can do all that 
integration and ask the State for a different number. That has 
no impact on the level of integration you bring to the work, 
correct? I mean, we are talking about what bill you hand the 
State, what number you had the State, one number or a lower 
number. That has nothing to do with the integration in terms of 
the ongoing work you are talking about. Does it?
    Mr. Woodley. It establishes, it seemed to me to establish 
that principle on the most firm basis. And certainly you are 
exactly right, we are perfectly capable of managing the 
accounting in a different way if Congress should so propose.
    Senator Vitter. Well, again, these two programs I am 
talking about, SELA and Lake Pontchartrain, have been around a 
long time. You are asking for a more demanding cost share for 
that work than ever before, than the historical share, that 
which was re-confirmed in WRDA, than that which was re-
confirmed in the supplemental over the last several years. And 
that seems particularly odd, given the extra pressure and 
demands that we have gone through because of the hurricanes.
    Mr. Woodley. Yes, sir.
    Senator Boxer. Senator Vitter, would you, your time is up, 
I would like to engage you in a question, because I don't 
understand it, either. It is baffling to me, this 65. Did that 
just come out of the blue? We didn't legislate it.
    Senator Vitter. Not the blue, OMB.
    Senator Boxer. It came out of OMB. But we did not legislate 
that change.
    Senator Vitter. No, in fact, we legislated the opposite. We 
have said several times, in WRDA and before that in the 
supplemental, we re-confirmed the historical cost shares which 
for one of these projects is 75/25, for another is 70/30. So we 
have only not said that, we have said the opposite.
    Senator Boxer. Well, OMB is once again wrong. OK.
    Senator Barrasso.
    Senator Barrasso. Thank you, Madam Chairman. I appreciate 
it.
    I wanted to get, if I could, back to some of the things I 
mentioned in my opening statement, about Cheyenne, Wyoming, 
concerns with the water supply there, and trichloroethylene, 
which is a chemical that is used to clean engines, rocket and 
motor parts, and there is a long history of the people in 
Wyoming and their commitment to our military and the missile 
systems which are there and in the ground. And the concern is 
this plume that people agree is there and folks living there 
think is one, related to the missile site and the Department is 
saying no, maybe several causes.
    Why does the Army Corps think that it is not all one plume? 
And I don't know how specifically you are familiar with the 
situation.
    Mr. Woodley. Senator, I have no responsibility for the 
program that is managing that. But fortunately, the Chief of 
Engineers does. I believe he is prepared to respond to that. 
But that is a formerly used Defense site program, which is 
managed as a military program within the Defense Department 
structure.
    General Van Antwerp. First of all, I would say we are going 
to do the right thing here. There is a remedial investigation 
going on and there is some difference in the values that were 
found in the data from the investigation that was done by the 
city of cheyenne and done by the remedial application. We have 
to come to grips with that.
    We are doing a feasibility study, that is underway. We have 
the money for that and we will come to grips with this. I agree 
with you, what are the other contributing factors, if there are 
contributing factors to it, apart from this plume that we know 
came from this remediation site. So we will get to the truth on 
that and get that to you.
    Senator Barrasso. The concern is, and I appreciate your 
comments that you are going to do the right thing, there does 
seem to be needless delay in this. I know I wrote to you back 
in December with concerns, because there was a letter written 
by the Wyoming Department of Environmental Quality back in 
2006, and several months later there was a meeting but not a 
formal letter response. I got a letter back from the deputy 
director of military programs, Joseph Tyler, dated February 
8th. He talks about, he apologizes that there wasn't a response 
back to the letter. That is where I think we have needless 
delay.
    Then he says that there is going to be a joint agency 
meeting March 11, 2008, which coincidentally is today. I know 
this hearing was initially set for a month ago, and I was going 
to at that time ask you, can you assure me that by the hearing, 
March 11th, today, that we really do get answers to this. So 
this probably will be held after our discussion.
    But we are very serious in Wyoming about saying, we are not 
used to needless delays. In Wyoming, we like to get things done 
right away.
    General Van Antwerp . We owe you an answer. I believe that 
is being held today. We will get you the results of that. So I 
owe you an answer to that.
    Senator Barrasso. Thank you very much, Madam Chairman.
    [Presiding] Senator Cardin.

         OPENING STATEMENT OF HON. BENJAMIN L. CARDIN, 
            U.S. SENATOR FROM THE STATE OF MARYLAND

    Senator Cardin. Thank you very much, Mr. Chairman.
    First let me welcome our witnesses, and I am sorry I 
couldn't be here to listen to your entire testimony.
    Secretary Woodley, I appreciate your call yesterday in 
regard to Chesapeake City. I am glad to see that is moving 
forward. I want to just concentrate on the Mid-Bay report that 
is due in regards to the next chapter of restoration and 
dredging for the Chesapeake Bay. The last time we had a chance 
to talk, I was under the impression that it is on schedule. I 
just really want to make sure that we can anticipate the report 
being delivered on time. We anticipate acting in this Committee 
on the next round of authorizations. It is important that we 
have that report in a timely manner for our Committee to act.
    I just want to take this opportunity, General, or Mr. 
Secretary, if you could comment on that and give us assurances 
that the report will be timely filed, I will feel a little bit 
better.
    General Van Antwerp. Sir, we just checked on this last 
night, as everyone was engaged here. It is another good thing, 
a lot of things happened before the hearing. That is good. But 
we are on schedule, it will go before the Civil Works Review 
Board in July 2008. And I am expecting the Chief's report by 
the end of September, beginning of October.
    Senator Cardin. That is even a little bit earlier than I 
think you told me the last time.
    General Van Antwerp. We are trying to deliver on this.
    Senator Cardin. And I thank you, and I thank you for your 
cooperation. We have had a good working relationship in trying 
to make sure we stay on schedule. I thank you for that.
    Madam Chairman, I am going to ask that my full opening 
statement be made part of the record.
    [Presiding] Without objection, so ordered.
    Senator Cardin. It is basically very complimentary of the 
work that you all do and the importance to our State from the 
western part, on flight control, to the eastern part, on 
serious erosion issues and weather problems. The Army Corps has 
been extremely helpful in maintaining and help us make sure 
that our channels are open for recreation and business use.
    Our challenge, quite frankly, is not with the two of you 
but with the budgets that have been submitted, as I am sure the 
Chairman has pointed out. We are going to do everything we can 
to help in that regard. It is a little disappointing to see all 
the work that we do, particularly on the Water Resources 
Reauthorization Act and on the programs that you all have done 
so much work to get ready and then find that the appropriated 
dollar amounts make it difficult for you to do the right 
investigations or the right construction or maintenance. I can 
assure you that we will do everything we can to make sure that 
the dollars are available for the good work that you all do.
    Thank you, Madam Chair.
    [The prepared statement of Senator Cardin follows:]

        Statement of Hon. Benjamin L. Cardin, U.S. Senator from 
                         the State of Maryland

    Madame Chairman, thank you for holding this hearing today.
    Maryland has a geography and topography which makes the 
Chesapeake Bay particularly susceptible to the adverse effects 
of erosion. This erosion contributes to five millions of cubic 
yards of sediment deposited annually into the bay, adversely 
affecting water quality, destroying valuable wetlands and 
habitat, and clogging navigation channels.
    Along our Atlantic coast, powerful winter storms and 
tropical cyclones can cause considerable beach erosion--
threatening the economic vitality of our premier Atlantic coast 
resort city, Ocean City.
    In the mountains of the western part of the State, runoff 
from heavy rains contributes to the potential of flooding in 
western communities.
    Maryland relies heavily upon the Army Corps of Engineers' 
civil works programs which are of high value to the health of 
our Chesapeake Bay, the configuration of our Atlantic and Bay 
coastlines, and to overall health our State's economy. The 
Corps of Engineers has projects and provides assistance to 
virtually every jurisdiction in the State of Maryland.
    The Chesapeake Bay is the nation's largest estuary. The 
Corps' oyster and habitat restoration, shoreline protection, 
and sediment management programs are integral to our efforts to 
restore the Bay. The oysters represent more that just a source 
of income for the oysterman who harvest them, they are also 
natural biological filters--continually cleaning up the Bay.
    The Port of Baltimore is one of the largest ports on the 
east coast and a vital engine of economic activity, 
contributing $2 billion to the State's economy and employing 
18,000 Marylander's directly and tens of thousands more 
indirectly.
    There are 126 miles of shipping channels leading to the 
Port of Baltimore. Maryland also has more than 70 small 
navigation projects supported by the Corps around the 
Chesapeake Bay and Atlantic Ocean. These navigation projects 
are critical to commercial and recreational fisherman, to local 
and regional commerce and to local economies.
    Along Maryland's 31 miles of Atlantic Ocean coastline, 
there are two critical Corps projects--a hurricane protection 
project at Ocean City, and a mitigation of shoreline erosion 
project at Assateague Island National Seashore.
    We rely heavily on the U.S. Army Corps of Engineers for 
flood protection in communities in Western Maryland and for 
water supply.
    As you can see, the civil works programs of the Corps have 
widespread beneficial impact throughout our state. Indeed 
similar impacts can be seen all across the Country. States need 
these resources to protect their communities from potential 
natural disasters and to improve the overall quality of their 
environments.
    Unfortunately, the President's proposed budget underfunds 
the Corps at a time when there is a significant backlog of 
projects to be completed. The budget places an unrealistically 
large burden on States to fund these projects (like beach 
renourishment). Furthermore, the budget does not even begin to 
implement many of the priorities of WRDA passed just last year.
    The hundreds of thousands of dollars spent on beach 
restoration today may mean saving many times over those amounts 
to clean up that beach and provide assistance to property 
owner's following a significant storm.
    I look forward to hearing from our witnesses today on the 
priorities of the President with respect to the Corps' 
activities.
    The Corps' work is critical. We need a level of commitment 
that is commensurate with its importance.

    Senator Boxer. Thank you, Senator.
    Senator Voinovich.
    Senator Voinovich. First of all, I want to say thank you, 
Mr. Woodley, for your service to our Country, and General, 
thank you very much for your service. I am sure that sometimes 
you think that ours is not to reason why, ours is just to do or 
die. We are asking a lot of things from you and quite frankly, 
the money is not there.
    I would like to just talk about a couple of things that are 
on my mind in terms of Ohio. We have the Cleveland Port 
Authority. It is very, very important to the economy of 
northeastern Ohio. The President's budget has provided 
$6,710,000 for dredging. We need $16,810,000 for the dredging. 
This is a very important project, and I am expecting that 
somebody is going to figure out how we are going to get that 
money to do it, or we will have to close the port.
    What bothers me is that there is $4.5 billion in the fund, 
the dredging fund that has been set aside. And for some reason, 
that is not being used. Well, the reason it is not being used 
is that the Administration is using that to balance the budget. 
They are borrowing trust funds, like they are Social Security, 
to hide the real costs of this budget. In other words, they 
just show a deficit of X number of dollars but the fact of the 
matter is, they only show the public debt, they don't show the 
Government debt. That to me is being, it is unacceptable.
    Second of all, we have a little project down in Finley, 
Ohio, where they have had the worst flooding that they have 
ever had in the city's history. It is a continuing authority 
and we need the money to just do the feasibility study for that 
project. It is not a whole lot of money. I would like to know 
when are we going to be able to get that money so that can be 
taken care of for that community, so they get some idea of what 
it is they can do to help themselves and to eliminate the 
situation they have. We have the public-private partnership 
there, we have the businesses that are interested, they may 
even come up with some money to fund the most important project 
that might make a difference for their community. But we can't 
get it done unless we have the feasibility study done and I am 
hoping that we are going to figure out how to do that.
    I appreciate the fact that you have money in for the 
Everglades, that was my legislation, for the CERP, 
Comprehensive Everglades Restoration Plan. That is moving 
along. And I am not from Florida, but the fact is, that is a 
very important ecological project, I think one of the most 
important in the Country. That gets me back to the Great Lakes. 
The President issued an executive order creating the Great 
Lakes Regional Collaboration and the Great Lakes Interagency 
Task Force. The Corps is a participant in both of those.
    The question I have is, can you tell me what actions, if 
any, the Corps has taken in response to the release of that 
strategy report? So there are three things. Strategy, 
feasibility and what are you doing about the Great Lakes?
    Mr. Woodley. Let me talk about first of all Finley. I think 
we are on track for that. We have money in the 2008, it is a 
continuing authorities project, so it is not one that we 
individually budget for. We budget for the program. But I 
believe that is on track with 2008 funding, and we understand 
and agree with you that it is an important priority within that 
program.
    The Great Lakes, we have participated of course with the 
interagency teams on that, we have some very interesting 
studies ongoing that are aimed at facilitating the restoration, 
including one that is creating a comprehensive tool for people 
who are interested in restoration to be able to access on a web 
basis, through the Internet, to understand what the options are 
and what various programs they can bring to bear on local 
issues for restoration within the basin.
    The other thing that I think is very interesting and that 
is underway in that regard in Ohio is the Ashtabula project 
that is, I believe we are going to be able to complete during 
this fiscal year. That will return that very important port 
facility in Ashtabula to service and deal with the 
contamination, the historical contamination of that watershed. 
I think that is a remarkable, very substantial achievement that 
we have in partnership with our colleagues at EPA.
    Senator Voinovich. Although the budget that EPA is asking 
for to do that kind of contamination removal is putrid. I 
started that dredging and contamination project when I was 
Governor of Ohio back in 1995 and earmarked $6 million of State 
money. Finally we are getting it done, amen and hallelujah.
    [Laughter.]
    Senator Boxer. Nice to see you smile, sir.
    Senator Klobuchar.
    Senator Klobuchar. I am sure I will make you smile again.
    Mr. Woodley, in your written testimony you mentioned that 
the budget for the emergency management program includes $40 
million in the Flood Control and Coastal Emergencies account to 
fund preparing for flood and coastal emergencies. Specifically 
you mentioned that this funding would cover review and updating 
of emergency response plans.
    Back in Minnesota, several counties were devastated this 
summer. I was there the day afterward, cows floating by, in 
last summer's flooding, and still these counties are still 
preparing their emergency response plans, they are very 
complicated for these small counties to handle. Until some of 
these communities, such as the ones in Fulmer County, get their 
emergency response plan approved, they cannot receive certain 
small business rebuilding loans from FEMA.
    Does the Corps intend to prioritize any funds in the Flood 
Control and Emergencies account for helping communities who 
have not fully prepared emergency response plans?
    Mr. Woodley. Senator, I am not aware of how those funds are 
used in conjunction with the localities. So I will have to 
research that and get back to you.
    Senator Klobuchar. OK, if you could. It has just been very 
difficult for them, they are trying to cross all the T's and 
dot all the I's. But what has been happening is they can't 
receive these small business loans. I have been at these stores 
and these places along their main street and they literally 
have been, every business was devastated. So they are trying to 
get help with that, so we can work with your office on that 
later. I appreciate it.
    The other thing I am just following up on, what Senator 
Voinovich asked about with the Great Lakes, could you just tell 
me what work the Corps is doing with these lake levels? We are 
very concerned with Lake Superior. It is at its lowest level in 
80 years. It has been affecting our barge traffic. We believe 
it is climate change because the ice has been melting and the 
water evaporating. Nevertheless, it is a problem. Could you 
illuminate what the Corps is doing in that regard?
    Mr. Woodley. I can tell you that our work on that is done 
in conjunction with the International Joint Commission on the 
Great Lakes. So we deal with the IGC on regulating lake levels 
where they are to be regulated.
    The other significant action that is underway in that 
regard is the St. Clair River study that we are trying to 
determine whether the dredging that has been undertaken in the 
St. Clair River area is having a hydrological effect that was 
unintended there. It is not clear whether it is. So we have 
work underway with the IGC to determine that.
    But we recognize that the lake levels are down and it is 
having an effect on operations across the basin.
    Senator Klobuchar. Thank you.
    I talked in my opening comments about how I believe the 
Administration's budget is far below the Corps' capability for 
investment in navigation, flood damage reduction, environmental 
restoration programs. I mentioned some of the work that needs 
to be done in Minnesota. Assistant Secretary Woodley, what 
amount do you believe the Corps could effectively invest in 
Fiscal Year 2009?
    Mr. Woodley. I don't know that I have a particular figure, 
Senator, but it is well in excess, in the construction account, 
of the amount that we were able to devote to that in the 
President's budget.
    Senator Klobuchar. Thank you.
    Senator Boxer. Thanks, Senator.
    We are going to start second rounds, 5 minutes each, and 
then you will be done. This question is for the General, 
actually both these questions, because these are longer term 
questions. I talked in my opening statement about Sacramento, 
and I am very grateful that you really have been dedicated to 
it. I guess what I want to do, since I have you here on the 
record, is to just make sure that this dedication is not just 
for the budget year, but until the project is done. If you 
could expand on that a little.
    General Van Antwerp. Absolutely, ma'am, it is long-term. 
There are some short-term aspects having to do with looking at 
all the levees right now, making sure what the standards are, 
getting them up to standard. But it is also a longer term, as 
we look at climate change, other things that will be affecting 
that. So we are with you for the long term.
    Senator Boxer. That is good, because again, just for the 
record, this flood plain is home to half a million people, it 
contains 165,000 homes, 1,300 government facilities, including 
our State capital of the largest State in the Union, and 
businesses providing 200,000 jobs. So this is, I mean, I could 
argue cost benefit ratios about a lot of places but this is 
open and shut, as far as it goes. Then to think that the 
predictions were worse for that area than for Louisiana, I 
mean, it really gets me going, gets me concerned.
    I will be working very closely with you throughout. I am 
going to go back up there and take a look-see myself. But I 
just would hope that we would have some transparency here if 
there are any problems, if you see problems on the horizon, 
because we know it is going to be very expensive. But the cost 
of doing nothing, in terms of lives and property damage and the 
rest of it, is just really almost untold.
    Then the other question I had revolves around the Napa 
River flood control project. I understand the budget has $7.39 
million in it. But my understanding is the capability, meaning 
the project, could take up to $22.8 million. So I want to 
confirm that is accurate.
    General Van Antwerp. Ma'am, I am actually showing 
capability of $24.6 million. And you are correct on the 2009 
budget.
    Senator Boxer. OK. Well, I hope we can work together. If we 
are fortunate enough and Congress does move and does restore 
funding, and I think Congress will, this budget may pass by, I 
don't know if it will or won't. We have Presidential, we have 
some illnesses, et cetera. But if this budget does pass, we 
will have a big restoration of dollars in the budget itself, 
and then of course in appropriations we will work as well.
    So would you be open to looking at that project, since it 
is capable of $24.6 million, if you do have more resources, can 
we talk about that?
    General Van Antwerp. Yes, ma'am.
    Senator Boxer. OK. Those were my two issues, and I would 
ask Senator Vitter if he would like a second round.
    Senator Vitter. Yes, thank you very much, Madam Chair.
    Morganza to the Gulf, as I said in the opening statement, 
it is an enormous frustration to me and everybody who cares 
about this project in Louisiana. It appears that the Corps is 
determined not to do this project, no matter what Congress 
does. Why do I say that? It is because the Corps first started 
looking at this, was directed to in 1992. The project was 
authorized in WRDA 2000, pending a chief's report by a certain 
date, and the Corps missed the deadline. The project is 
authorized again fully in WRDA 2007. And a month after WRDA 
2007 passes, the Corps says, no, nothing doing, because we 
think project costs will exceed 20 percent of the authorized 
level, everything is on hold.
    That appears to us as complete bad faith and complete 
determination to not do this work, no matter what Congress 
says. What is the status of Morganza to the Gulf right now, Mr. 
Secretary?
    Mr. Woodley. Right now the project is authorized, based on 
a feasibility study that is several years old. I think it is 
entirely prudent that we predetermine, because of the dramatic 
events that have taken place, and the dramatic changes that 
have taken place in the cost of construction in that part of 
the world, that go, that we move aggressively and quickly to 
determine an up to date cost estimate for the project and 
advise you of that cost estimate at the earliest possible date.
    Senator Vitter. When was it determined by the Corps that 
you think project costs will exceed 20 percent of authorized 
level?
    Mr. Woodley. I don't know exactly when that particular 
determination was made. I do know that it has been apparent for 
some time that the feasibility study completed in 2002 had been 
overtaken by events.
    Senator Vitter. Why isn't the Corps doing what happens all 
the time in big projects when there are new, open questions, 
that you move forward with certain work and you continue to 
refine and answer those open questions? That is done all the 
time in big projects, but not here. We are just calling a halt 
to any progress here.
    Mr. Woodley. I believe that the rules under which we 
operate call for us, when a project has, when it is apparent 
that a project is going to go very substantially over its 
authorized level, that we return to the authorizing committee 
for further instructions.
    Senator Vitter. Well, let me go back to that time line. 
Because we passed WRDA in November 2007. Then on December 13th, 
1 month later, the chief of engineers' office informs the local 
sponsor that they expect the costs to go over 20 percent of 
authorized levels. Why didn't you say boo to us when we are 
putting the number in WRDA, rather than wait a couple weeks 
after WRDA passes and say essentially, gotcha? You think you 
have an authorization? You don't. Why isn't that clear evidence 
of basically bad faith, a determination to not do this project 
on your part?
    Mr. Woodley. We have made no, by no means have we made a 
determination not to do the project.
    Senator Vitter. You made a determination not to do any work 
in the foreseeable future, even though we just passed the 
authorization.
    Mr. Woodley. We made a determination, I believe, to update 
the cost estimate and to advise the Congress of the fact that 
the authorized cost estimate is probably inadequate to complete 
the project.
    Senator Vitter. Do you have a new cost estimate?
    Mr. Woodley. As of today, I don't believe that we do.
    Senator Vitter. So you don't know that it is over 20 
percent of the authorized level?
    Mr. Woodley. It would astonish me if it were not.
    Senator Vitter. OK, but you don't have a new cost estimate?
    Mr. Woodley. I don't believe we do.
    Senator Vitter. So why can't we move forward with aspects 
of the project which are ready to go, like the Houma Locks?
    Mr. Woodley. I would say that, if that lock is a separable 
element that can be separately justified, that we can proceed 
with preliminary work like the preconstruction engineering and 
design with respect to that.
    Senator Vitter. Let me move quickly to another big topic 
that I mentioned, which is the outfall canals. When will the 
final report be given to Congress regarding the preferred 
solution to the outfall canal issue?
    Mr. Woodley. Let me ask the Chief if he could address the 
operational aspects on that.
    General Van Antwerp. We are looking at all alternatives for 
that, sir. One of the things that we are looking at very 
closely is, should we remove the existing stations, as you have 
seen, and we have all seen down there. We are proceeding with, 
we want to go design-build for this. And I think that, I don't 
know, Don, would you have a date when we might be complete with 
the report?
    Speaker. No, sir, the design-build contractor will give 
us----
    Senator Vitter. I believe there has been a technical 
report, we have that.
    General Van Antwerp. Right, that is correct.
    Senator Vitter. I believe there is a cost economic report 
due, and I thought it was very soon. Is there not a tentative 
date for that report?
    General Van Antwerp. We don't have a date for that report. 
Let me get that to you. But what we are going to do with the 
design-build, then we will get, as that designer and builder 
comes on, we are going to get accurate cost data.
    Senator Vitter. Madam Chair, can I just follow up on this 
one topic?
    Senator Boxer. One more minute.
    Senator Vitter. Will that cost economic report include a 
specific recommendation in terms of one of the four options, 1, 
2, 2(a) or 3?
    General Van Antwerp. Yes, sir.
    Senator Vitter. That decision has not been made yet?
    General Van Antwerp. No, it has not, to my knowledge.
    Senator Vitter. OK. If that decision has not been made, why 
is the cost of one particular option build into the budget 
submission? That is the fact. You have submitted a budget. That 
budget assumes a cost for this work. That is the cost of one of 
those four options, not all of them, one of them. So it seems 
to us that everything has been pre-judged. Why am I wrong in 
coming to that conclusion?
    General Van Antwerp. I will have to dig deeper into that. I 
can't answer that question.
    Senator Vitter. Finally, Mr. Secretary and General, I would 
just point out that the technical report, I think, gives clear 
evidence that option 2, including the possibility of 2(a), is 
superior in terms of the top goal, flood protection. It says, 
option 2 is generally more technically advantageous and may be 
more effective operationally over option 1, because it would 
have greater reliability and further reduces risk of flooding. 
I think it is very clear that option 2 is more robust and 
reduces the risk of flooding much more than option 1. The 
problem is, even though you say a decision has not been made, 
the funding level is the funding level of option 1. That 
obviously causes us great concern that things are being pre-
judged by folks like OMB, being driven by cost over 
engineering.
    Senator Boxer. Senator, I think you have made your point 
here. I think it would be very important for the Corps to 
explain themselves, because if you are saying a decision has 
been made, yet you have put a certain amount in, have they put 
in, Senator Vitter, the largest amount?
    Senator Vitter. No, they put in a smaller amount for option 
1.
    Senator Boxer. That is why that doesn't seem to make any 
sense, you are right. If they put in the larger amount to be 
conservative and say, well, if we have to go there, it makes 
sense. I think Senator Vitter has made some important points. I 
hope you will get back to him on this, because it does sound 
odd to me.
    Senator Voinovich.
    Senator Voinovich. I would like a letter from you, 
Secretary, on the backlog of your OM projects. What is the 
backlog of your OM projects. I would also like to have a letter 
on the backlog of construction projects. We added a lot more 
with the last WRDA bill. But I would like to have that list of 
how much we----
    Mr. Woodley. Which backlog do you want, Senator?
    Senator Voinovich. The whole darned backlog, the backlog of 
the projects that you have that have been, all the engineering 
work has been done and a local share is in place. I want to 
know what it is.
    I would also like to know, and all due respect to Senator 
Vitter, I would like to know how much money has the Corps spent 
on Katrina since this has all been started. I want to know how 
much money we spent there. Yes, sir, go ahead.
    Mr. Woodley. With respect to construction on flood damage 
and storm surge reduction works, is that what you had in mind?
    Senator Voinovich. I have the construction projects that 
you got for the Army Corps of Engineers, including Army Corps 
projects and the environmental restoration, which we continue 
to lay on top of the Corps of Engineers. If there is a question 
about what it is, I want whoever is going to draft the letter 
to come to my office and we will sit down and talk about it. We 
will look at the options, so that we are comparing apples to 
apples and oranges to oranges.
    Mr. Woodley. Absolutely. That is what I am concerned about.
    Senator Voinovich. Let's get that scheduled. I want to get 
that done with a week's time with you, OK?
    Mr. Woodley. Absolutely. We are available for that.
    Senator Voinovich. All right, we will see what that is.
    The other thing is, I want to know how much money is in 
that, is it $4.5 billion in the dredging fund?
    Mr. Woodley. I don't think it is quite that much, but it is 
a lot of money.
    Senator Voinovich. It is a lot of money. And it is just 
sitting there?
    Mr. Woodley. It is just sitting there.
    Senator Voinovich. Yes, sir. And I have already talked 
about the fact that Cleveland Port Authority is not going to 
have the money to do the dredging. I would like to have the 
number that you have allocated for dredging in the Great Lakes 
and what the actual cost is of doing the dredging in the Great 
Lakes, so we have that number in place.
    Last but not least, the Chairman of the Committee has 
raised the issue about prioritizing. I notice in this written 
testimony it says that ``Many more construction projects have 
been authorized, initiated and continued than can be 
constructed efficiently at any one time. The funding of 
projects with low economic and environmental returns and of 
projects that are not within Civil Works' main mission areas 
has led to the postponement of benefits from the most worthy 
projects and has significantly reduced overall program 
performance. To remedy the situation and to achieve greater 
value to the Nation from the Civil Works construction, the 
budget again proposes performance guidelines to allocate funds 
among construction projects.''
    I think the Chairman was talking about, we try to come up 
with a new prioritization of how you go about doing these 
projects. I think, Madam Chairman, you said that they haven't 
done it yet.
    Senator Boxer. That is right.
    Senator Voinovich. I think that is one of the things that 
we ought to be doing. We ought to be looking at prioritization. 
I know when I was Governor, I came in and they had $26 billion 
of highway projects. So we spent 3 years coming up with an 
objective as to determining which ones are priority one, 
priority two and priority three, so we had some semblance of 
just where we should be going with this.
    And I would at least like the Corps to do what we asked 
them to do in the last WRDA bill, and the Chairman of the 
Committee, Madam Chairman has talked about starting another 
WRDA bill. Maybe as a parting shot or contribution to America, 
Mr. Woodley, maybe you ought to write us a letter and say, if 
you really wanted to get this done in terms of prioritization 
and get things, kind of a semblance of what is No. 1, No. 2, 
No. 3 priorities, understanding that you get lobbied from all 
of us for our own pet projects, I would like to know some 
objective, your ideas on how we could be more objective in 
getting at this backlog and in conveying to the American people 
just what it is.
    That is our problem. They don't get it. They don't get it. 
They just think that money is coming out of--something. They 
don't understand that we are $9 trillion in debt. They don't 
understand that our dollar is worth very little today. They 
don't understand that our debt now is being purchased by the 
Arab nations and the Chinese and others. They don't get it.
    So we need to get those facts in front of us. I know 
Senator Clinton and I and others have an infrastructure 
commission that we would like to get done. It is sitting over 
in the House. We need to do that, as a national priority, Madam 
Chairman, we need to have a comprehensive, we did it with 
highways, for this Country, so that we all understand just 
exactly what the challenge is. Because we have been sticking 
our head in the sand too long. We are going to wake up and we 
are not going to have the infrastructure that we need to be 
competitive in this global marketplace.
    Senator Boxer. Senator Voinovich, I so much appreciate your 
comments. I will work with you on this.
    Do you have any further comments?
    Senator Voinovich. That is it.
    Senator Boxer. OK. Let me just say, rather than ask any 
further questions, I will be sending a letter, just because, 
General, I was very pleased that you mentioned global warming. 
Because in all of your plans, I am assuming you are now really 
looking hard at that. Am I correct?
    General Van Antwerp. Ma'am, we are looking hard at climate 
change. I will use those words. Because we know that the 
climate has actually been very schizophrenic, even here in the 
United States, some places in the southwest were just 
inundated, and of course, we have drought in other places. So 
it definitely is part of it. Sea level rise is another thing 
that has to be accounted for in projects.
    Senator Boxer. What I am going to do is send you a letter, 
because right now, in California, the reason we are at such 
risk due to global warming is because with rising temperatures, 
and as we know, that has nothing to do with what the 
temperature is today or tomorrow, it is temperature over time, 
as the scientists have told us, and they have given us their 
crystal ball, and they are 90 percent certain that they are 
right.
    So we have this crystal ball the scientists have given us, 
they say look at it, and with rising temperatures, we are going 
to see the rate of the melting snow pack will cause increased 
runoff, increasing the flood elevation, making flooding more 
devastating. We are already seeing that snow pack melt sooner. 
It means you have to be very mindful of releases from different 
reservoirs and so on and so forth.
    So I am going to send you a letter. I am going to ask you 
how you are incorporating the impacts of the snow pack due to 
global warming into the Corps' plan and into your operating 
procedures for existing reservoirs. Because I will tell you, if 
you don't look at it, and we make a plan for one set of 
circumstances, it turns out to be inadequate because we didn't 
build this in, it is a real problem.
    And as you probably know, there are some insurers who have 
stopped insuring properties that are along the coastlines now. 
This is serious stuff. The United States of America, we are big 
business. And you are part of it. Without your work, as Senator 
Voinovich says, we can't have the kind of economy that we have 
to have. We need that infrastructure. So it has to fit the 
times.
    Now, I am going to work hard with others to try and avert 
the worst damaging impacts. I would recommend to you a book 
called Six Degrees. If you haven't read it, you ought to read 
it. This is a national--and I hope maybe Senator Voinovich will 
read this book. What this individual does, he writes for 
National Geographic. He shows what would happen for every 
degree of warming over time. It just puts it into some very 
stark terms. Those of us who are working hard know we can't 
avert it all, but we can avert the worst if we move forward. I 
hope you are taking it into account.
    I think you have seen a lot of strong feelings today in 
front of you. I hope you realize that we care about the work 
you do. We want to give you the tools to do the best that you 
can. We want your honesty. Let OMB put on their eye shades, and 
let them tell us what their priorities are. Guess what? They 
are not elected and they don't have the jobs you have. We are 
going to restore the money for the Corps. We don't care what 
they say. We are going to restore it. We did it last time, we 
are going to do it again. Why? Because we have to be able to 
address the infrastructure needs of our people.
    So we are going to do that. So get ready to plan that. That 
gets to Senator Voinovich's last point about prioritization. I 
asked you about a couple of projects that I know well. And it 
is important for you to be thinking, if we do get that funding 
restored, and when you have Senator Inhofe and everybody work 
together to restore it, it will be restored. We hope you will 
move quickly to tell us what projects you think are worthy of 
moving forward.
    And that gets again to Senator Voinovich's point, which 
ones are ready with the local share, the reports are done, the 
environmental impact assessments are done. We need to be ready, 
because my view is you will get additional funding. Because we 
are not going to be cutting the Army Corps' budget. It is just 
not going to happen. It can't happen for a great Country like 
this.
    So we thank you very much. If we were tough on you, 
understand it is out of deep commitment to the work that you do 
that we are kind of tough.
    Thank you very much. We stand adjourned.
    [Whereupon, at 11:40 a.m., the committee was adjourned.]

         Statement of Hon. James M. Inhofe, U.S. Senator from 
                         the State of Oklahoma

    Thank you Chairman Boxer for holding this hearing, and 
thank you Secretary Woodley and General Van Antwerp for 
testifying before us today.
    Today's hearing is to look at the President's fiscal year 
2009 budget request for the Corps of Engineers as well as the 
implementation of WRDA 2007. Let me first say a few words about 
WRDA 2007 before I speak to the budget request. Many of us on 
this committee worked very hard for several years to enact what 
should have been WRDA 2002. Instead, we had 5 extra years in 
which project cost estimates increased significantly and many 
local communities had to hope that the delay wouldn't prove 
disastrous. We owe these local communities and Federal 
taxpayers nationwide better than that.
    In order to avoid these circumstances going forward, 
Senator Boxer and I have both previously indicated how 
important we feel it is to get back on a 2-year cycle by 
working on a WRDA 2008. Today I want to reaffirm my commitment 
to doing so.
    We should not underestimate how important the many project 
authorizations and policy improvements in WRDA 2007 are to the 
country's economy, public safety and environment. I look 
forward to hearing from the Assistant Secretary and the Chief 
what their plans are for speedy implementation of these many 
important provisions.
    As far as the President's budget request for fiscal year 9, 
I have to say that I was extremely disappointed to see that 
this request was not only a significant decrease from fiscal 
year enacted levels, but that it was even a decrease from the 
fiscal year budget request. Unfortunately, it's not uncommon 
for a Presidential budget request to come in under the previous 
year's enacted levels. It doesn't seem to matter which party is 
in the White House or which party controls Congress, Congress 
typically does more to acknowledge and address our water 
resources needs than does the executive branch. To see a 
reduction from last year's budget request, however, is truly 
disheartening.
    As a fiscal conservative, I strongly support the overall 
goal of reigning in government spending, but I firmly believe 
that the two things the Federal Government should spend money 
on are defense and infrastructure. It may not be as exciting or 
headline-grabbing as some other areas of government spending, 
but a robust and well-maintained national infrastructure system 
is what allows our economy to remain strong and continue to 
grow.
    I was pleased to see the Administration acknowledge the 
need for continued investment in our inland waterways system. 
Just from a parochial perspective, I know that the McKlellan-
Kerr Arkansas River Navigation System in Oklahoma and Arkansas 
could function much more efficiently and productively if we 
proceed with deepening it to 12 feet from its current 9 foot 
depth. I am not fundamentally opposed to user fees where 
appropriate, but I plan to wait for more details before 
deciding whether to support or oppose this proposal.
    Finally, let me convey my appreciation for the Corps' work 
in subsidence reporting, cleanup and resident assistance at the 
Tar Creek Superfund site. The Corps has consistently responded 
quickly and helpfully to the variety of issues that have arisen 
during our efforts at this site.
    I look forward to hearing the witness testimony and to 
discussing these issues in more depth during the question and 
answer period.

         Statement of Hon. Joseph Lieberman, U.S. Senator from 
                        the State of Connecticut

    Thank you Madam Chairman for convening this important 
hearing to discuss the Fiscal Year 2009 President's Budget 
request for the Army Corps of Engineers. In my home State of 
Connecticut, we rely heavily on the work of the Army Corps to 
keep our harbors open, our rivers navigable, and our cities 
dry. I am greatly aware of the important work this agency does 
and believe it is essential that they are provided with 
sufficient resources to complete their work in the most 
efficient and environmentally responsible manner. With those 
resources comes the responsibility for improved management and 
increased transparency into the decisionmaking process. I hope 
that the witnesses here today will elaborate on specific 
actions that are being taken in this regard to meet the 
requirements in the Water Resources Development Act of 2007.
    While the Army Corps is beginning to place greater emphasis 
on performance-based budgeting when making construction 
prioritization decisions, I believe more must be done to 
increase the use of environmental metrics in their benefit to 
cost analysis of projects. WRDA recognizes the importance of 
responsible environmental management, and yet I fear that the 
Army Corps failed to consider environmental factors as part of 
its benefit to cost ratio when setting construction priorities 
for 2009. Given the diverse environmental implications of the 
work that the Army Corps undertakes on this Nation's behalf, 
not including the environment as part of the benefit to cost 
ratio is unacceptable.
    While environmental considerations may not have played a 
large role when setting construction priorities, I want to 
applaud the Army Corps for beginning to look beyond individual 
projects toward the broader watershed implications of their 
work and solutions to problems in the area of operations and 
maintenance. A more holistic view is essential to preserving 
the environment and I am pleased to see that the Army Corps is 
beginning to use the US Geological Survey's sub-watersheds as a 
way to allocate funding among 54 geographic areas. 
Unfortunately, details on how specific sub-watersheds were 
identified and the actual implementation of this sub-watershed 
allocation of operations and maintenance funding are not very 
clear. I hope the witnesses today will provide specific details 
on how this management approach will be used and how it differs 
from the watershed allocations from the Fiscal Year 2008 
budget.
    I am also interested in hearing from these witnesses on the 
progress the Army Corps is making in implementing a number of 
the reforms called for in WRDA. I am a strong advocate for 
greater transparency in the decisionmaking process the Army 
Corps uses to select and fund projects. For example, the use of 
peer review can be an effective tool to ensure that projects 
are appropriately assessed and a wide range of impacts fully 
considered before significant funds are allocated for a project 
that may have been improperly scoped. I am interested to know 
what progress the Army Corps is making on identifying projects 
that meet the peer review criteria established in WRDA and how 
the peer review process will be implemented in the future.
    The Army Corps faces a number of challenges as it 
undertakes ambitious management reforms. I thank the witnesses 
for being here today to help us navigate the contents of the 
Fiscal Year 2009 request for the Army Corps of Engineers, 
including the steps that are being taken to comply with the 
requirements of WRDA, and welcome them to this hearing.

           Statement of Hon. John Warner, U.S. Senator from 
                         the State of Virginia

    Good Morning Madame Chairwoman and colleagues on the Senate 
Environment and Public Works Committee. I thank you for holding 
this hearing today to discuss the President's proposed budget 
for the civil works program of the U.S. Army Corps of Engineers 
and also to discuss the implementation of last year's Water 
Resources Development Act (WRDA) bill.
    As my colleagues are aware, the President's fiscal year 
2009 budget request for the Army Corps of Engineers is $4.741 
billion, an amount that represents a decrease of $851 million 
from the fiscal year 8-enacted level of $5.592 billion. I am 
concerned about this decrease in light of the passage of WRDA 
2007 and the growing infrastructure needs of our Nation. This 
hearing is a good first step, as we open dialog to budgetary 
concerns and the needs of our nation's civil works program 
provided by the Army Corps of Engineers.
    I was glad to see the passage of WRDA in 2007, legislation 
that was long overdue. Today, I look forward to an engaging 
discussion about the progress made by the WRDA reforms and the 
progress that remains to be seen. As we look back on the 
efforts we have made, I am confident that we can create a 
successful WRDA for 2008.
    Last, I'd like to note the good work that the Corps has 
been doing and is doing in my state, Virginia. Divided amongst 
five Army Corps districts (Baltimore, Huntington, Nashville, 
Wilmington, and Norfolk), Virginia has been lucky to have 
extremely competent and talent leaders at each outpost. Their 
professionalism and dedication have furthered projects across 
the state--from flood control projects in the city of Roanoke 
and Town of Grundy, to the development of Craney Island in 
Norfolk, to oyster restoration efforts in the Chesapeake. I 
have been pleased to work with all of these districts and 
praise their good work.
    Madame Chairwoman, I thank you for the opportunity to speak 
this morning, and for holding this important hearing.


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