[Senate Hearing 112-]
[From the U.S. Government Publishing Office]



 
    ENERGY AND WATER DEVELOPMENT APPROPRIATIONS FOR FISCAL YEAR 2013

                              ----------                              


                       WEDNESDAY, MARCH 28, 2012

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 2:30 p.m., in room SD-192, Dirksen 
Senate Office Building, Hon. Dianne Feinstein (chairman) 
presiding.
    Present: Senators Feinstein, Landrieu, Lautenberg, Harkin, 
Alexander, Collins, Murkowski, and Graham.

                      DEPARTMENT OF DEFENSE--CIVIL

                         DEPARTMENT OF THE ARMY

                       Corps of Engineers--Civil

STATEMENT OF JO-ELLEN DARCY, ASSISTANT SECRETARY OF THE 
            ARMY (CIVIL WORKS)


             opening statement of senator dianne feinstein


    Senator Feinstein. Good afternoon, ladies and gentlemen, 
and welcome to the Energy and Water Subcommittee's oversight 
hearing on the fiscal year 2013 budget request for the United 
States Army Corps of Engineers and the Bureau of Reclamation.
    Let me say from the outset, and I've never actually said 
this before in 20 years, I am a big fan of both of your 
agencies. The work that your agencies do touches nearly every 
person in the Nation. It's really where the pedal meets the 
metal. Forty-one States are served by 926 Corps harbors and 
25,000 miles of waterways.
    These harbors and waterways move more than 2.3 billion tons 
of cargo annually. Damages prevented by Corps flood control 
projects over the last decade exceed 25 billion annually. 
That's prevention. Every $1 invested in flood control since 
1928 has prevented more than $7 in damages when adjusted for 
inflation.
    I'd have to say that 7-to-1 is a good return on any 
investment. The Corps is the number one Federal provider of 
outdoor recreational opportunities, and the number one producer 
of hydroelectric power. And they're extensively involved in 
environmental and ecosystem restoration.
    The Bureau of Reclamation provides water and power to the 
17 Western States. They deliver water to 31 million people for 
municipal, rural, and industrial uses. Reclamation delivers 
water to 20 percent of the West's farmers, providing irrigation 
to 10 million acres of some of the most productive agricultural 
land in the world.
    Reclamation also addresses water resources and challenges 
posed by drought, climate change, depleted aquifers, 
environmental needs, energy demands, and population increases 
in the West.
    We depend on both of your agencies to build this water 
infrastructure as well as facilitating much needed 
environmental restoration. Not only does the work you perform 
provide jobs now, the infrastructure that's constructed, 
continues to benefit the economy for decades which in turn 
creates more jobs and boosts our standard of living.
    While we all realize that for the next decade, we're going 
to be operating under austere budget caps in the Budget Control 
Act, we should not underfund agencies that provide tangible 
benefits and create jobs. This is really where America lives, 
where America works, and where America either thrives or does 
not.
    The President's fiscal year 2013 budget for the Corps of 
Engineers is $4.7 billion, which is $271 million or 5.4 percent 
below the 2012 enacted amount. The Bureau of Reclamation's 
budget is proposed at $1.03 billion, which is $14 million or 
1.3 percent below the 2012 enacted amount.
    Candidly, I don't believe these budget requests provide the 
necessary resources to adequately fund ongoing work, and I've 
never said that before. For example, the Corps construction 
budget is proposed at $1.47 billion, which is $223 million or 
13.2 percent below the 2012 enacted amount.
    Dam safety and environmental restoration and compliance 
activities account for $850 million or 58 percent of the 
request. Inland and deep draft navigation accounts for $336 
million or 23 percent of the request, and only $226 million or 
15 percent is directly toward traditional flood control 
projects.
    Of the 95 construction projects proposed in the budget 
request, only 46 are displayed with benefit-to-cost ratios. 
That means that more than one-half of the projects proposed for 
funding utilize a much more intangible set of budget criteria. 
And I'm going to ask about that.
    A skeptic might even say that these budget decisions were 
arbitrary or politically based. However, my point is, that 
while I believe we can agree that nearly all of the items in 
the budget request have merit, one certainly has to question 
how the decisions were made for the many ongoing projects that 
were not included.
    Based on my review, I believe your budget request needs 
some adjusting. It appears to me that while your overall budget 
for fiscal year 2013 boosts funding for navigation, which is a 
good idea, the budget proposes less funding for flood control 
in 2013 than you proposed in 2012.
    I'm concerned about this decrease particularly in light of 
two record-setting floods in the Missouri and Mississippi 
Rivers in 2011. I very much hope that it's not the start of a 
trend.
    In the general investigation account, 80 studies are listed 
in the budget for a total of $52 million. However, five studies 
are adequately funded for about $24 million of that total, 
leaving the other 75 studies competing for the remaining $28 
million. This, candidly, doesn't seem balanced to me.
    I have other issues with the Corps budget that I'll ask 
about at the appropriate time. Now, turning quickly to the 
Bureau of Reclamation's budget.
    The scheduled completion of the Animas-La Plata Project and 
the Red Bluff fish screen and Pumping Plant Project this year 
seemed to have freed up some funding within your budget. As a 
result, your budget request seems to be more balanced than in 
prior years.
    Hopefully, the planned completion of the Mni Wiconi Rural 
Water Project in 2013 will have a similar impact on the 2014 
budget. So I'm pleased to see an increase in discretionary 
funding for the San Joaquin River Restoration in your budget 
for 2013.
    This discretionary funding along with the mandatory funding 
under the settlement agreement will assure that water impacts 
are reduced or avoided while maintaining the San Joaquin River 
ecosystem.
    Rural water projects are proposed at higher levels than in 
your budget request but are still not funded at the levels 
necessary, we think, to continue progress on these projects. So 
I look forward to exploring that with you as well.
    Senator Alexander, I'm very fortunate, if anybody in this 
room doesn't know it, I say it all the time, I'm really very 
fortunate to work with a great ranking member. He is sincere. 
He is straightforward. He is bright. He is everything. So I 
have really lucked out.
    So let me recognize our distinguished ranking member, 
Senator Alexander.


                  statement of senator lamar alexander


    Senator Alexander. Thank you, Madam Chairman. The feeling 
is absolutely mutual, and I'd like to write that down if I may. 
That's very kind of you to say that.
    Senator Feinstein. Okay.
    Senator Alexander. We do have a very good working 
relationship, and I thank the staff for their working together 
as well and the courtesy that the chairman shows us as we work 
on these issues.
    That was a very good statement of reaction, I think, to the 
proposals that we have. I'd like to make just two or three 
points, and then I'll look forward to your testimony.
    One, I want to congratulate the Corps of Engineers for the 
work you did during the floods and natural disasters of 2011. 
The only way to congratulate you is to compare what happened in 
2011 with what happened in the big flood in 1927, which we call 
the Great Flood.
    Books have been written about it. That year, I think 16 
million acres were inundated, 500 people died, 600,000 
displaced, 41,000 buildings destroyed, rail lines cut, 
communities wiped out. That was the story of 1927.
    But contrast that with 2011, after a lot of investment and 
work by the Corps of Engineers, no lives lost, 4 million people 
protected. It was all done so well that many people and the 
rest of the country didn't even know there was a big problem.
    The Corps estimates that our investments in the Mississippi 
River and Tributaries Project of about $14 billion over the 
last 80 years probably saved about $500 billion. Figures like 
that are always speculative, but the idea is probably right. 
That a small investment has had a big return.
    And the Congress provided $1.7 billion in disaster recovery 
funding last year to restore the damages from flooding to Corps 
facilities. One way to tell the level of interest in an 
agency's work is by the attendance of Senators at hearings 
involving them.
    And I can remember a hearing last year of the Environment 
and Public Works Committee at which I believe 17 Senators of 
both parties showed up to either talk about, criticize, praise, 
or have some opinion about the effect of the big floods in 
their States.
    Now, the second thing I'd like to talk about is the Harbor 
Maintenance Trust Fund and the Inland Waterways Trust Fund. 
I've now watched this for a few years. We have two trust funds 
and neither one of them works well.
    The first, the Harbor Maintenance Trust Fund, collects 
money successfully, but it turns out we can't use the money on 
things communities need to expand ports and double exports as 
the President has suggested.
    The second fund, the Inland Waterways Trust Fund, doesn't 
collect enough money. And so projects like the Chickamauga Lock 
and others are on indefinite hold, really, are not getting the 
attention they need.
    I would like to strongly suggest, and the chairman and I 
have been working on this with other members of the 
subcommittees, that we step back and take a look at these two 
trust funds, Harbor Maintenance, Inland Waterway, and think 
about our country and the competitive position that we want it 
to be in in the future, and think of what we need to do.
    Don't think about the money involved, or how to collect the 
money. Think first about, what do we need to do? What's our 
vision for the future? And then, see if we can match money and 
procedures to the vision we have.
    My experience is that most ideas in Washington, DC fail for 
lack of the idea. And I would strongly urge you to work with us 
over the next few months to see if we can take both these trust 
funds, and not just muddle along the way we had been muddling.
    But to say, okay, what do we need to do for, you know, the 
greatest country in the world, the one that produces 25 percent 
of all the wealth in the world, with the Panama Canal being 
deepened, our ports need to be deepened. We need locks and dams 
that are safe in the inland waterways.
    And I believe that if we have the right vision, we would be 
able to do something about that. I remember a few years ago, we 
had something called America Creating Opportunities to 
Meaningfully Promote Excellence in Technology, Education, and 
Science (America COMPETES) Act. We asked a distinguished group, 
the National Academies did, to tell us what would be the 10 
things the Congress could do to keep us competitive in the 
world marketplace.
    This distinguished group, headed by Norm Augustine, gave us 
20 things. We eventually got 35 Republican and Democratic co-
sponsors. We passed that law. It's been funded. It's been 
reauthorized and it succeeded because we had an idea and we 
stopped muddling.
    Now, it didn't do everything. But we need to do the same 
kind of thing with our ports and our locks and our dams. So I 
ask you to work with us to do that.
    I'm particularly troubled about the $1 billion cost 
increase in Olmsted Locks and Dam. Makes me almost think I'm in 
the National Nuclear Security Administration (NNSA) hearing 
where things just keep going up and up and up and up and up 
with no rational reason for it.
    I mean, what is happening is that single project is soaking 
up all the money available for everything else in the country, 
and that's poor planning, and something's wrong when we have 
that kind of increase.
    I'm particularly sensitive to that because of the effect 
it's having on the Chickamauga Lock on the Tennessee River near 
Chattanooga. If that lock fails, it closes down one-third of 
the navigation on the Tennessee River. It would force chemical 
plants, Tennessee Valley Authority (TVA) reactors, Oak Ridge 
National Lab to put more freight and hazardous materials on our 
roads.
    It would put 150,000 heavy trucks in Interstate 75, and it 
would flood downtown Chattanooga. Now, we don't want any of 
that. And we also don't want the slowdown that we're seeing 
right now with the Chickamauga Lock.
    I know that there had been some work done with industry to 
try to come up with a way to put more money into the trust 
fund. But what I'm asking for is working with Industry and the 
subcommittee and with anybody who has any idea, let's have a 
vision for where we need to go with both the needs that are 
supposed to be addressed by these trust funds and come up with 
a mechanism that works.
    I certainly pledge my effort to do that and working with 
the chairman and Senator Collins and other members of the 
subcommittee, I would like to give that a try over the next few 
months.
    Thank you, Madam Chairman.
    Senator Feinstein. Thank you very much. Senator Collins, do 
you have a comment you would like to make at this time?


                   statement of senator susan collins


    Senator Collins. Thank you, Madam Chairman.
    First of all, let me just agree with the praise that the 
chairman and the ranking member heaped on one another. They do 
work extraordinarily well together and they're truly a model 
for how the Senate should work.
    I know that my west coast colleagues will address the 
Bureau of Reclamation's budget requests so my comments and 
questions today are going to focus on the Army Corps of 
Engineers.
    I just want to make two points. The first is that I'm very 
concerned about the discrepancy in the way the Army Corps 
regulates developments that affect wetlands versus how it is 
done in the State of Maine and other parts of the country.
    The second issue that I want to raise is my concern that we 
not forget as we look at the major navigational waters, the 
need for maintenance, dredging projects at smaller harbors and 
waterways, those are very important in a State like mine, for 
our fishermen, for example.
    And I know that last year, the Chair and the Ranking Member 
worked with us to include $30 million for operations and 
maintenance projects at small, remote, or subsistence 
navigation harbors and waterways. And I think that is extremely 
important as well.
    So, thank you for the opportunity to comment.
    Senator Feinstein. Thank you.
    From the Department of the Army, we will hear from Jo-Ellen 
Darcy, the Assistant Secretary of the Army for Civil Works, and 
Major General Bo Temple, Acting Chief of Engineers for the 
Corps.
    From the Department of the Interior, we will hear from Anne 
Castle, Assistant Secretary for Water and Science, and Mike 
Connor, Commissioner, Bureau of Reclamation.
    Secretary Darcy, we will begin with you.


                  summary statement of jo-ellen darcy


    Ms. Darcy. Thank you, Senator Feinstein, and distinguished 
members of the subcommittee, thank you for the opportunity to 
present the President's fiscal year 2013 budget for the Civil 
Works program of the Army Corps of Engineers.
    I am Jo-Ellen Darcy, the Assistant Secretary of the Army 
for Civil Work, and I'll now summarize my statement and ask 
that my complete statement be included in the record.
    The President's 2013 budget provides $4.7 billion for the 
Civil Works program. This is $100 million above the President's 
2012 budget request for Civil Works.
    The budget reflects the Administration's priorities through 
targeted investments in the Nation's water resources 
infrastructure, including dams and levees to address flood 
risks, and navigation projects in support of both domestic and 
global trade, especially at coastal ports that support the 
greatest national economic activity. The budget also includes 
restoration of major ecosystems affected by past water 
resources development in support of the Administration's 
initiatives such as America's Great Outdoors and the Clean 
Water Framework.
    The budget also supports programs that contribute to the 
protection of the Nation's waters and wetlands, the generation 
of low-cost, renewable hydropower, the restoration of certain 
sites contaminated as a result of the Nation's early atomic 
weapons development program, emergency preparedness and 
training to respond to natural disasters, and recreation, 
environmental stewardship and water supply storage at existing 
projects owned or operated by the Corps.
    The budget funds a number of activities to completion, 
including 5 flood risk management projects, 3 navigation 
projects, 1 hydropower mitigation project, and 18 studies.
    The Civil Works budget includes funding for three high-
performing construction new starts, six study new starts, and a 
new activity in the Operation and Maintenance account to reduce 
the vulnerability of our Civil Works projects to extreme 
natural events.
    The budget includes funding to evaluate the potential for, 
and encourage the use of, nonstructural alternatives during 
postdisaster recovery decisionmaking while leveraging the 
expertise of intergovernmental teams known as Silver Jackets to 
support States and communities in the development and 
implementation of actions to reduce flood risks.
    The budget includes the highest amount ever budgeted for 
use of receipts from the Harbor Maintenance Trust Fund to 
maintain coastal channels and harbors. Inland waterway capital 
investments in the construction account are funded at the 
maximum amount that is affordable within the project trust fund 
revenues under existing law.
    Last September, President Obama transmitted to the Congress 
a proposal to modernize financing of capital investments on the 
inland waterways through establishing a new vessel user fee to 
supplement the existing fuel tax.
    The Administration will continue to work with the Congress 
and stakeholders to enact a mechanism to increase revenues to 
this trust fund. The 2013 budget provides $532 million for dam 
and levee safety activities including $491 million for dam 
safety activities in both the flood risk management and 
navigation programs.
    We have $41 million to continue the comprehensive levee 
safety initiative. The Army continues to work to modernize the 
Civil Works Planning program. Proposed changes are aimed at 
dramatically shortening the time and the costs of completion 
for pre-authorization studies while retaining the quality of 
the analyses.
    The budget again includes $3 million for the Veterans 
Curation Project which provides vocational rehabilitation and 
innovative training for wounded and disabled veterans while 
achieving historical preservation responsibilities for 
archeological collections administered by the Corps.
    This program will contribute to the goals of the 
President's recently announced Veterans Job Corps.


                           prepared statement


    In summary, the 2013 budget for the Army Civil Works 
program is a fiscally prudent, appropriate level of investment 
that will generate jobs, contribute to a stronger economy, and 
continue progress on important water resources investments that 
will yield long-term returns for the Nation and its citizens.
    I'd like to thank the members of the subcommittee and I 
look forward to working with you in support of this President's 
budget. Thank you.
    [The statement follows:]
                  Prepared Statement of Jo-Ellen Darcy
    Madam Chairman and distinguished members of the subcommittee, thank 
you for the opportunity to present the President's budget for the Civil 
Works program of the United States Army Corps of Engineers (COE) for 
fiscal year 2013.
                                overview
    The fiscal year 2013 budget for the Civil Works program reflects 
the Administration's priorities through targeted investments in the 
Nation's water resources infrastructure, including dams and levees, 
navigation investments in support of both domestic and global trade, 
restoration of ecosystems affected by past water resources development, 
and support of administration initiatives such as America's Great 
Outdoors and the Clean Water Framework. These investments will generate 
American jobs, contribute to a stronger economy, improve reliability 
and efficiency of waterborne transportation, reduce flood risks to 
businesses and homes, and provide low-cost renewable hydropower. In 
addition, investment in the restoration of significant aquatic 
ecosystems and the remediation of sites associated with the Manhattan 
Project of the 1940s will not only provide important benefits but also 
support jobs.
    The primary objectives of the budget are as follows:
  --Focus funding on water resources investments that will yield high-
        economic and environmental returns or address a significant 
        risk to public safety.
  --Support commercial navigation through maintenance and related 
        activities at the most heavily used commercial harbors and 
        waterways in the Nation.
  --Modernize financing of capital investments on inland waterways by 
        establishing a new user fee.
  --Restore large ecosystems such as the California Bay-Delta, 
        Chesapeake Bay, the Everglades, Great Lakes, and Gulf Coast.
  --Invest in improvements to the Corps regulatory program that will 
        provide greater efficiency, providing benefits to businesses 
        and more protection to regulated wetlands and small streams.
  --Provide significant funding for dam and levee safety, including 
        interim risk reduction measures designed to immediately 
        mitigate risk at the highest risk dams, and continue funding to 
        advance the Corps' national levee safety initiative to help 
        improve the safety of Federal levees and to provide available 
        levee data on levee safety issues to non-Federal entities.
  --Support the modernization of Federal water resources infrastructure 
        processes to address 21st century water resources needs through 
        improvements to policies and procedures that govern Federal 
        water resources development and strategies for both managing 
        the Nation's aging infrastructure and restoring aquatic 
        ecosystem functions affected by past investments.
  --Increase the organizational efficiency and improve the management, 
        oversight, and performance of ongoing programs.
    The budget funds the planning, design, construction, operation and 
maintenance of projects, and focuses on the three main Civil Works 
mission areas:
  --commercial navigation;
  --flood and storm damage reduction; and
  --aquatic ecosystem restoration.
    The budget also supports programs that contribute to the protection 
of the Nation's waters and wetlands; the generation of low-cost 
renewable hydropower; the restoration of certain sites contaminated as 
a result of the Nation's early atomic weapons development program; 
emergency preparedness and training to respond to natural disasters; 
and recreation, environmental stewardship, and water supply storage at 
existing projects owned or operated by the Corps.
              fiscal year 2013 discretionary funding level
    The budget for fiscal year 2013 for the Civil Works program 
provides a fiscally prudent, appropriate level of investment in the 
Nation's water resources infrastructure and in the restoration of its 
aquatic ecosystems.
    In keeping with President Obama's commitment to put the country on 
a sustainable fiscal path, while continuing to invest in those efforts 
that are a priority for the Nation, the budget includes $4.731 billion 
in discretionary appropriations for the Army Civil Works program. This 
represents a reduction of $271 million, or about 5 percent, from the 
fiscal year 2012 enacted level, but is a $100 million above the 
President's fiscal year 2012 budget. The fiscal year 2013 funding level 
reflects a considered, practical, effective, and sound use of the 
Nation's financial resources.
    Within the $4.731 billion recommended appropriations, $1.47 billion 
is for projects in the Construction account, and $2.398 billion is for 
activities funded in the Operation and Maintenance (O&M) account. The 
budget also includes:
  --$102 million for Investigations;
  --$234 million for Mississippi River and Tributaries;
  --$30 million for Flood Control and Coastal Emergencies;
  --$205 million for the Regulatory Program;
  --$104 million for the Formerly Utilized Sites Remedial Action 
        Program;
  --$182 million for the Expenses account; and
  --$5 million for the Office of the Assistant Secretary of the Army 
        for Civil Works.
    Attachment 1 shows this funding by account and program area.

                                        ATTACHMENT 1.--FISCAL YEAR 2013 BUDGET--BUSINESS LINE/ACCOUNT CROSS-WALK
                                                                [In millions of dollars]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                      Funding Categories
                                    --------------------------------------------------------------------------------------------------------------------
                                                                               MR&T
           Business Lines                                      ------------------------------------                                       OASA
                                        I        C       O&M                                TOTAL    FUSRAP    FCCE     REG       E       (CW)    TOTAL
                                                                   I        C       O&M      MRT
--------------------------------------------------------------------------------------------------------------------------------------------------------
Flood and Coastal Storm Damage            46      652      536       <1       83       89      172  .......  .......  .......  .......  .......    1,406
 Reduction.........................
    Coastal........................        5       17       11  .......  .......        4        4  .......  .......  .......  .......  .......       37
    Inland.........................       41      635      525  .......       83       85      168  .......  .......  .......  .......  .......    1,369
Hydropower.........................  .......        2      178  .......  .......  .......  .......  .......  .......  .......  .......  .......      180
Navigation.........................       25      352    1,326  .......       14       30       44  .......  .......  .......  .......  .......    1,747
    Coastal........................       17      151      797  .......  .......        2        2  .......  .......  .......  .......  .......      967
    Inland.........................        8      201      529  .......       14       28       42  .......  .......  .......  .......  .......      780
Environment:
    Aquatic Ecosystem Restoration..       31      464       14       <1        2  .......        2  .......  .......  .......  .......  .......      512
    Stewardship....................  .......  .......       92  .......  .......        4        4  .......  .......  .......  .......  .......       96
    FUSRAP.........................  .......  .......  .......  .......  .......  .......  .......      104  .......  .......  .......  .......      104
Regulatory.........................  .......  .......  .......  .......  .......  .......  .......  .......  .......      205  .......  .......      205
Recreation.........................  .......  .......      241  .......  .......       11       11  .......  .......  .......  .......  .......      252
Emergency Management (incl. NEPP)..  .......  .......        6  .......  .......  .......  .......  .......       30  .......  .......  .......       36
Water Supply.......................  .......  .......        5  .......  .......  .......  .......  .......  .......  .......  .......  .......        6
Expenses...........................  .......  .......  .......  .......  .......  .......  .......  .......  .......  .......      182  .......      182
OASA(CW)...........................  .......  .......  .......  .......  .......  .......  .......  .......  .......  .......  .......        5        5
                                    --------------------------------------------------------------------------------------------------------------------
      TOTAL........................      102    1,471    2,398        1       99      134      234      104       30      205      182        5    4,731
--------------------------------------------------------------------------------------------------------------------------------------------------------
I=Investigations; C=Construction; O&M=Operation and Maintenance; MR&T=Flood Control, Mississippi River and Tributaries; FUSRAP Formerly Utilized Sites
  Remedial Action Program; FCCE=Flood Control and Coastal Emergencies; REG=Regulatory Program; NEPP=National Emergency Preparedness Program; E=Expenses;
  OASA(CW)=Office of the Assistant Secretary of the Army for Civil Works.

    The fiscal year 2013 budget continues the Army's commitment to a 
performance-based approach to budgeting to provide the best overall 
return from available funds from a national perspective in achieving 
economic, environmental, and public safety objectives. Competing 
investment opportunities for studies, design, construction, and 
operation and maintenance were evaluated using multiple metrics, and 
objective performance criteria guided the allocation of funds.
    The fiscal year 2013 budget supports investments in commercial 
navigation, flood risk management, aquatic ecosystem restoration, and 
other programs. The distribution of funding among these programs is 
similar to the distribution in the fiscal year 2012 budget, except for 
an 11-percent increase in investments in support of waterborne 
transportation. Of the total in the fiscal year 2013 budget, 30 percent 
is allocated to flood risk management activities; 37 percent is 
allocated to commercial navigation; and 33 percent to environmental, 
hydropower, and other activities. Five flood risk management projects, 
three navigation projects, one hydropower project, and 18 studies are 
funded to completion in this budget.
                  new investments in fiscal year 2013
    The Civil Works budget includes funding for three high-performing 
construction new starts and six new study starts, and a new activity to 
focus on reducing the vulnerability of Civil Works projects to extreme 
natural events.
    In the Construction account, parallel to the recommendation for 
fiscal year 2012, the budget includes $7.5 million for the Hamilton 
City project in California, which will provide environmental 
restoration and flood damage reduction benefits in the Bay-Delta area; 
$16.8 million for the Louisiana Coastal Area Ecosystem Restoration 
program, a nationally significant and urgent effort to both restore 
habitat and protect the important Louisiana gulf region from the 
destructive forces of storm driven waves and tides, which will 
complement the ongoing Federal effort under the Coastal Wetlands 
Planning, Protection, and Restoration Act, as amended; and $2 million 
for the Lower Colorado River Basin, Onion Creek, Texas, project, which 
will significantly reduce the risk of flood damages using nonstructural 
solutions.
    There are six new studies in the Investigations account, five of 
which were recommended in fiscal year 2012. These six studies are:
  --an important new reconnaissance study for fish passage at 
        Englebright and Daguerre Point Dams on the Yuba River in 
        California for $100,000;
  --environmental restoration and flood damage reduction at Cano Martin 
        Pena in Puerto Rico for $100,000;
  --the Chesapeake Bay Comprehensive Plan for $250,000;
  --the Louisiana Coastal Area Comprehensive Plan for $100,000; and
  --the national Water Resources Priorities Study for $2 million.
    The fiscal year 2013 budget also includes $100,000 for a new study 
of the Houston Ship Channel, Texas.
    The Water Resources Priorities Study will establish a baseline 
assessment of the Nation's flood risks on both national and regional 
scales, improve existing programs, and reduce future costs by focusing 
on which ongoing and future investments will best reduce flood risks. 
The $8 million for new line-item called Reducing Civil Works 
Vulnerability in the O&M account will aid the Corps in creating a more 
robust Civil Works infrastructure.
    Within the Floodplain Management Services Program, $3 million is 
recommended to evaluate the potential for and encourage the use of 
nonstructural alternatives and actions during post-disaster recovery 
decisionmaking. With these funds, the Corps would leverage the 
expertise of intergovernmental teams known as Silver Jackets to provide 
selected technical services and support States and communities in the 
development and implementation of actions to reduce flood risks, with 
an emphasis on nonstructural alternatives.
                      infrastructure modernization
    The Administration is developing and considering proposals to serve 
as the foundation of a comprehensive water resources infrastructure 
modernization initiative, which will help the Federal Government 
support a 21st century water resources infrastructure. In considering 
and developing these new policies, procedures, and strategies, the 
Administration will continue to engage and collaborate with the 
Congress and the many stakeholders whose interests are tied to the 
Nation's water infrastructure, including State, local, and tribal 
governments.
                               navigation
    The budget includes a high level of investment in support of 
domestic and global waterborne transportation, especially at coastal 
ports that support the greatest national economic activity. On the 
inland waterways, the budget focuses on maintaining reliable service at 
those waterways with a high level of commercial use, specifically, the 
Lower Mississippi River, Ohio River, Upper Mississippi River, Gulf 
Intracoastal Waterway, Illinois Waterway, Tennessee River, and the 
Black Warrior Tombigbee Waterway. Funding to operate and maintain the 
Mississippi River, Baton Rouge to the Gulf project is $82 million, a 
significant increase above the $68 million requested for fiscal year 
2012.
    The budget provides $68 million to continue deepening the New York 
and New Jersey Harbor project in order to complete construction by 
fiscal year 2014. The budget also includes $38 million to construct 
dredge material placement sites at several deep draft ports to provide 
additional capacity for the maintenance of these projects in the 
future. It provides $12 million to continue studies and designs at 
coastal ports, including several proposals to deepen existing channels 
to accommodate Post-Panamax commercial shipping.
    The budget also provides for use of $848 million from the Harbor 
Maintenance Trust Fund to maintain coastal channels and harbors. This 
is a 12-percent increase over the fiscal year 2012 budget and the 
highest amount ever proposed in a President's budget for use of 
receipts in the Harbor Maintenance Trust Fund.
    Inland waterway capital investments are funded at $201 million, of 
which $95 million will be derived from the Inland Waterways Trust Fund. 
This is the amount that is affordable within the projected level of 
revenue to this trust fund under existing law. In September 2011, as 
part of his Jobs bill proposal, President Obama transmitted to the 
Congress a proposal to modernize financing of capital investments on 
the Nation's inland waterways. The proposal includes increasing the 
revenue paid by commercial navigation users sufficiently to meet their 
share of the costs of capital development activities financed from the 
Inland Waterways Trust Fund. A new vessel user fee would supplement the 
existing fuel tax. The Administration will continue to work with the 
Congress and stakeholders to enact such a mechanism to increase revenue 
to this trust fund, in order to enable a significant increase in 
funding for high-performing inland waterway capital investments in the 
future.
                         flood risk management
    Through both structural and nonstructural measures, the flood risk 
management program serves as a vehicle to reduce the risk to human 
safety and property from riverine and coastal flooding. The fiscal year 
2013 budget provides $1.4 billion for the flood risk management 
program, including $492 million that is directed at dam and levee 
safety.
    This flood risk management program also includes $41 million to 
continue the comprehensive levee safety initiative to assess the 
conditions of Federal levees and help ensure that they are safe. These 
funds will also enable the Corps to better assess and communicate risk, 
for example, by providing information that will assist non-Federal 
entities in identifying safety issues with their levees. The Corps will 
be conducting levee inspections and levee risk screenings, adding to 
the data in the national levee inventory, and providing the available 
levee data to communities for their use in gaining accreditation under 
the Federal Emergency Management Agency's National Flood Insurance 
Program.
    In addition to this funding in the flood risk management program, 
the budget includes $40.2 million in the navigation program to address 
dam safety issues at two navigation dams (Locks and Dams 2,3,4, 
Monongahela River, Pennsylvania, and Lockport Lock and Dam, Illinois).
                     aquatic ecosystem restoration
    The fiscal year 2013 budget reflects a continuing effort by the 
Corps and other Federal agencies to collaborate developing a unified 
budget proposal, which reflects the Nation's priorities for restoring 
its most significant aquatic ecosystems. Attachment 2 provides a list 
of these ecosystems and the Corps funding amounts budgeted on this 
basis.

       ATTACHMENT 2.--FISCAL YEAR 2013 PRIORITY ECOSYSTEMS FUNDING
                        [In millions of dollars]
------------------------------------------------------------------------
 Ecosystem
account \1\               Projects and studies                 Amount
------------------------------------------------------------------------
           Bay Delta:
          I    Yuba Fish Passage                                   .1
          I    CALFED Coordination                                 .1
               San Pedro Watershed                                 .2
          I    Sac-San Joaquin Delta Island and Levee             1.02
                Study
          I    Sac-San Joaquin Comp Study                          .3
          C    Hamilton City                                      7.5
          C    American River Common Features                     8
          C    Sac River Bank Protection                          3
          C    Success Dam Remediation [DSAP]                     3
        O&M    Additional studies and projects in                28.3
                Navigation and Flood Risk Management
                Programs
                                                         ---------------
                 Total, Bay Delta                                51.5
                                                         ===============
           Chesapeake Bay:
          I    Chesapeake Bay Comp (new recon)                     .3
          I    Lynnhaven                                           .3
          I    Upper Rappahannock                                  .05
          I    Anacostia--Montgomery                               .25
          I    Anacostia--Prince Georges                           .25
          C    Chesapeake Oysters                                 5
          C    Poplar Island                                     13.5
                                                         ---------------
                 Total, Chesapeake Bay                           19.6
                                                         ===============
           Everglades:
          C    Everglades                                       153.3
        O&M    Everglades                                         7.78
                                                         ---------------
                 Total, Everglades                              161.08
                                                         ===============
           Great Lakes:
          I    Interbasin Control Study [GLMRIS]                  3
          C    Chicago Sanitary and Ship Canal [CSSC]            24.5
        O&M    Dredging                                          75.09
                                                         ---------------
                 Total, Great Lakes                             102.59
                                                         ===============
           Gulf Coast:
          I    LCA--studies, PED                                  9.96
          C    LCA--Beneficial Use                                5
          C    LCA--Amite Diversion                               5.6
          C    LCA--Atchafalaya to N Terrebonne                   6.2
                                                         ---------------
                 Total, Gulf Coast                               26.26
------------------------------------------------------------------------
           \1\ Key: I=Investigation; C=Construction; O&M=Operation and
             Maintenance.

    The budget for the Army Civil Works program provides $161 million 
to efficiently fund the ongoing South Florida Ecosystem Restoration 
Program, which includes the Everglades, consisting of $153 in the 
Construction account and $8 million in the O&M account. It also 
supports several major ecosystem-wide initiatives, by providing a total 
of $81 million in the aquatic ecosystem restoration program in support 
of the Federal efforts in the California Bay-Delta, Chesapeake Bay, the 
Great Lakes, and the gulf coast.
    The budget includes $98 million for the Columbia River Fish 
Mitigation program, an ongoing effort to reduce the adverse impacts of 
a series of Corps dams on migrating salmon. Funds will be used to 
construct juvenile fish bypass facilities, improve adult fish ladders 
and conduct other activities that support salmon habitat. The budget 
also provides $90 million for ongoing work under the Missouri River 
Fish and Wildlife Recovery program to construct shallow water habitat 
and undertake other activities to recover and protect federally listed 
species, such as the pallid sturgeon.
                         planning improvements
    The Army continues to work to modernize the Civil Works Planning 
program to better address the current and future water resources needs 
of the Nation. The Army has undertaken an aggressive review of all 
ongoing, protracted feasibility studies to assure that studies are 
scoped appropriately and to focus limited resources on studies with the 
highest probability of leading to high performing projects. Proposed 
changes are aimed at dramatically shortening the timeframe for 
completion of pre-authorization studies while retaining the quality of 
the analyses, reducing the cost of conducting planning studies, and 
increasing Corps corporate and individual accountability for decisions.
    The fiscal year 2013 budget includes $4 million for the national 
Planning Support Program. These funds will be used to improve training 
of Corps planning personnel, including through the Planning Associates 
Program; support development and implementation of revisions to the 
Water Resources Principles and Guidelines in accordance with 
requirements in the Water Resources Development Act of 2007 (sec. 2031, 
Public Law 110-114); and provide for more stable, capable national 
planning centers of expertise.
                           regulatory program
    The budget includes $205 million for the Regulatory Program, which 
is a $9 million increase above the fiscal year 2012 budget. This 
funding increase is one of the Army's priorities. It will support a 
transparent and timely permit review process, bringing greater program 
efficiency and customer service. It will enable the Corps to better 
protect high-value aquatic resources, enable more timely business 
planning decisions, and support sustainable economic development.
                       veterans curation project
    The fiscal year 2013 budget includes $3 million to continue the 
Veterans Curation Project, which provides vocational rehabilitation and 
innovative training for wounded and disabled veterans, while achieving 
historical preservation responsibilities for archaeological collections 
administered by the Corps. The project supports work by veterans at 
curation laboratories located in Augusta, Georgia; St. Louis, Missouri; 
and Washington, DC. This project will contribute to the goals of the 
President's recently announced Veterans Job Corps.
                 american recovery and reinvestment act
    The American Recovery And Reinvestment Act (ARRA) provided $4.6 
billion for the Civil Works program. That amount includes:
  --$2 billion for Construction;
  --$2.1 billion for O&M
  --$375 million for Mississippi River and Tributaries;
  --$25 million for Investigations;
  --$25 million for the Regulatory Program; and
  --$100 million for the Formerly Used Sites Remedial Action Program.
    The Corps applied ARRA funds to more than 800 projects across the 
Nation.
    The Army is proud to report that 99.8 percent of the ARRA 
appropriations for Civil Works are obligated, and more than 87 percent 
of the funds have been outlayed to date. These investments helped 
create or maintain direct construction industry jobs, jobs in firms 
supplying or supporting construction work and the businesses that sell 
goods and services to these workers and their families.
                               conclusion
    In summary, the President's fiscal year 2013 budget for the Army 
Civil Works program is a performance-based budget that supports 
continued progress on important water resources investments that will 
yield long-term returns for the Nation and its citizens.
    These investments will generate jobs, contribute to a stronger 
economy, support waterborne transportation, reduce flood risks to 
businesses and homes, provide low-cost renewable hydropower, restore 
important ecosystems, and deliver other benefits to the American 
people.
    Madam Chairman and members of the subcommittee, I look forward to 
working with this subcommittee in support of the President's budget. 
Thank you.

    Senator Feinstein. Thank you very much, Secretary Darcy. 
General Temple, would you like to make comments now? Please go 
ahead.
STATEMENT OF MAJOR GENERAL MERDITH W.B. TEMPLE, ACTING 
            COMMANDING GENERAL, CHIEF OF ENGINEERS
    General Temple. Madam Chairman and members of the 
subcommittee, I'm Major General Bo Temple, the Acting Commander 
of U.S. Army Corps of Engineers (USACE) and Acting Chief of 
Engineers, and I'm honored to be here with Ms. Darcy to testify 
regarding the President's fiscal year 2013 budget for the Civil 
Works program.
    The Corps is wrapping up an unprecedented period of 
construction and project execution. Over the past 5 years, we 
provided $12 billion in base realignment and closure (BRAC)-
related construction, $7 billion of American Recovery and 
Reinvestment Act work in both our Military and Civil Works 
programs, and about $14 billion of gulf coast recovery work.
    In 2011, more than 2,000 Corps employees deployed in 
response to multiple disasters, including Midwest tornadoes and 
flooding in the Missouri, Mississippi, and Souris river basins 
and also throughout the Northeast due to Hurricane Irene and 
Tropical Storm Lee.
    Our systems performed as designed, saving lives and 
preventing billions in damages. However, as you are aware, many 
of our projects were damaged, and we are currently working to 
address those issues utilizing the $1.7 billion the Congress 
appropriated for this purpose.
    The fiscal year 2013 budget includes $4.7 billion to fund 
Civil Works activities within the Corps' three main water 
resources missions: Commercial navigation, flood and storm 
damage reduction, and aquatic ecosystem restoration.
    The budget includes $102 million for these and related 
activities in the Investigations account, and $1 million in the 
Mississippi River and Tributaries (MR&T) account.
    It funds 81 continuing studies and six new studies. It also 
includes more than $10 million for work on proposals to deepen 
seven U.S. ports.
    The budget includes $1.47 billion in the Construction 
account and $99 million in the MR&T account, funding 101 
construction projects including 57 flood and coastal storm 
damage reduction projects, 5 of which are budgeted for 
completion, 23 commercial navigation projects, 19 aquatic 
ecosystem restoration projects, and mitigation associated with 
2 hydropower projects.
    The Operation and Maintenance (O&M) program includes $2.53 
billion and an additional $134 million under the MR&T program 
with a focus on the maintenance of key commercial navigation, 
flood and storm damage reduction, hydropower and other 
facilities.
    The Corps will continue to implement actions to improve its 
planning program through planning modernization efforts 
focusing on how best to modernize the planning program to more 
effectively address water resources challenges.
    The Corps always strives to improve its efficiency and 
effectiveness. In fiscal year 2013, the Corps will further 
expand the implementation of modern asset management programs 
using a larger portion of its funds for the most important 
maintenance work while implementing an energy sustainability 
program that pursues major deficiencies in the acquisition and 
operations of our information technology assets as well as 
finalizing the organization of the Corps acquisition work 
force.
    The fiscal year 2013 budget provides $30 million for 
preparedness for floods, hurricanes, and other natural 
disasters including $3 million in support of the Corps 
participation in levee safety and other flood mitigation 
initiatives such as the Silver Jackets program to provide 
unified Federal assistance in implementing flood and coastal 
storm damage reduction solutions.
    Internationally, the Corps of Engineers continues to 
support the mission to help Iraq and Afghanistan build 
foundations for democracy, freedom, and prosperity. In Iraq and 
Afghanistan, we completed or closed out hundreds of projects in 
support of the host nations and coalition forces.
    This critical infrastructure and our capacity building 
efforts will play a key role in ensuring stability and security 
for those nations.

                           PREPARED STATEMENT

    The Corps remains committed to change that ensures an open, 
transparent and performance-based Civil Works program while 
remaining focused on consistently delivering innovative 
resilient risk-informed solutions to the Armed Forces and to 
the Nation.
    Thank you, Madam Chairman and members of the subcommittee. 
This concludes my statement, and I'm happy to take questions 
when we're ready.
    Senator Feinstein. Thank you very much, General Temple.
    [The statement follows:]
        Prepared Statement of Major General Merdith W.B. Temple
                              introduction
    Madam Chairman and distinguished members of the subcommittee: I am 
honored to be testifying before your subcommittee today, along with the 
Assistant Secretary of the Army (Civil Works), the Honorable Jo-Ellen 
Darcy, on the President's fiscal year 2013 budget for the Civil Works 
Program of the United States Army Corps of Engineers (COE).
    The Corps is wrapping up an unprecedented period of construction 
and project execution. Over the past 5 years, we provided $12 billion 
in base realignment and closure (BRAC)-related construction; $7 billion 
of American Recovery and Reinvestment Act (ARRA) work in our Military 
and Civil Works programs combined; and about $14 billion of gulf coast 
recovery work.
    In 2011, the Corps responded to several devastating tornadoes and 
floods, as well as hurricanes and tropical storms, under the National 
Response Framework in support of Federal Emergency Management Agency 
(FEMA). Flooding was a significant problem as we experienced record 
high water levels for a much longer duration than is the norm 
throughout much of the country. Our flood risk reduction systems were 
operated at their maximum capacity, some for the first time.
    The great men and women of COE worked tirelessly, together with our 
State, local, and industry partners, to ensure that we could deliver on 
all of our commitments last year. It is through their efforts that we 
were successful and will continue to be able to carry out the projects 
and programs included in the fiscal year 2013 budget.
    My statement covers the following 11 topics:
  --Summary of fiscal year 2013 program budget;
  --Direct Program;
  --Investigations Program;
  --Construction Program;
  --Operation and Maintenance Program;
  --Reimbursable Program;
  --Planning Program Modernization;
  --Efficiency and Effectiveness of Corps Operations;
  --Value of the Civil Works Program to the Nation's Economy and 
        Defense;
  --Research and Development; and
  --National Defense.
               summary of fiscal year 2013 program budget
    The Corps is fully committed to its support of the Nation's 
priorities to reduce the deficit, contribute to the economy, and 
restore and protect the aquatic environment. The fiscal year 2013 Civil 
Works budget provides the Corps with the means to support these 
priorities. It 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 
risks to human safety, to include continuing a comprehensive levee 
safety initiative and supporting increased interagency and stakeholder 
collaboration. The Reimbursable Program funding is projected to provide 
an additional $1.6 billion.
                             direct program
    The budget includes $4.7 billion for Civil Works activities, with 
priority on the highest performing activities within our three main 
water resources missions--commercial navigation, flood and storm damage 
reduction, and aquatic ecosystem restoration. The budget invests in 
more than 600 flood and storm damage reduction projects, 143 commercial 
coastal navigation projects, and 51 projects on the inland waterways. 
For example, it provides increased funding for high use, commercial, 
coastal channels, and harbors including support of efforts to 
accommodate Post-Panamax ships. In total, the budget supports ongoing 
construction of 98 projects and three new construction starts. The 
budget includes funds for 81 studies already underway and six new study 
starts. It will enable the Corps to process approximately 80,000 permit 
requests and to operate 75 hydropower plants with 350 generating units 
that produce approximately 24,000 megawatts annually. At its multi-
purpose projects, the Corps also stores water to supply about 14 
percent of the Nation's municipal water needs. The budget will also 
sustain the Corps' preparedness to respond to natural disasters.
                         investigations program
    The budget for the Investigations program will enable the Corps to 
evaluate and design future projects that are most likely to be high-
performing within the Corps three main water resources mission areas. 
The budget includes $102 million for these and related activities in 
the investigations account and $1 million in the Mississippi River and 
Tributaries account. It funds 81 continuing studies and six new 
studies:
  --Englebright and Daguerre Point Dams (Yuba River) Fish Passage, 
        California;
  --Cano Martin Pena, Puerto Rico;
  --the Chesapeake Bay Comprehensive Plan;
  --the Louisiana Coastal Area Comprehensive Study; and
  --the Houston Ship Channel, Texas.
    Funding is also included for the Water Resources Priorities Study, 
a high-priority evaluation of the Nation's vulnerability to inland and 
coastal flooding, as well as the effectiveness, efficiency, and 
accountability of existing water resource programs and strategies. 
Investigations funding also includes $10.63 million for work on 
proposals to deepen seven U.S. ports:
  --Boston, Massachusetts;
  --Charleston, South Carolina;
  --Savannah, Georgia;
  --Wilmington, North Carolina;
  --Brazos Island, Brownsville Channel, Texas; and
  --Jacksonville, Florida, and Houston, Texas.
                          construction program
    The goal of the construction program is to deliver as high a value 
as possible to the Nation from the overall available funding through 
the construction of new water resources projects and the replacement, 
rehabilitation, and expansion of existing flood and storm damage 
reduction, aquatic ecosystem restoration, commercial navigation, and 
hydropower projects. The fiscal year 2013 budget includes $1.47 billion 
in the Construction account and $99 million in the Mississippi River 
and Tributaries account to further this objective. Consistent with this 
objective, the budget also gives priority to projects that address a 
significant risk to human safety.
    The budget funds 101 construction projects, including:
  --57 Flood and Coastal Storm Damage Reduction projects (five budgeted 
        for completion);
  --23 Commercial Navigation projects (including 11 continuing 
        mitigation items and 6 dredged material placement areas);
  --19 Aquatic Ecosystem Restoration Projects (including 4 projects to 
        meet Biological Opinions); and
  --mitigation associated with two Hydropower projects.
    Three of these construction projects are new starts:
  --Hamilton City, California;
  --Louisiana Coastal Area Ecosystem Restoration, Louisiana; and
  --Lower Colorado River,Wharton-Onion Creek, Texas.
    This program also includes significant environmental mitigation 
work in the Columbia River Basin and the Missouri River Basin needed to 
support the continued operation of COE multipurpose projects, which 
improves habitat and migration pathways for endangered and threatened 
species.
    Performance measures, which the Corps uses to establish priorities 
among projects, include the benefit-to-cost ratios for projects with 
economic outputs and the most cost-effective restorations of 
significant aquatic ecosystems. The selection process also gives 
priority to dam safety assurance, seepage control, and static 
instability correction work and to activities that address a 
significant risk to human safety. These performance measures maximize 
the overall return to the Nation from the investment in the Civil Works 
construction program, by focusing on the projects that will provide the 
best net returns for each $1 invested.
                   operation and maintenance program
    The facilities owned and operated by, or on behalf of, COE care 
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 American people, a growing challenge in some cases, as 
proper maintenance is becoming more expensive at many of our projects.
    The operation and maintenance (O&M) program for the fiscal year 
2013 budget includes $2.53 billion and an additional $134 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 O&M 
program supports completed works owned or operated by the COE, 
including administrative buildings and laboratories. Work to be 
accomplished includes:
  --operation of the locks and dams of the inland waterways;
  --dredging of inland and coastal Federal commercial navigation 
        channels;
  --operating multiple purpose dams and reservoirs for flood damage 
        reduction, commercial navigation, aquatic ecosystem 
        restoration, hydropower, and related purposes;
  --maintenance and repair of the facilities; monitoring of completed 
        storm damage reduction projects along our coasts; and
  --general management of Corps facilities and the land associated with 
        these purposes.
                          reimbursable program
    Through the Interagency and Intergovernmental Services Program we 
help non-Department of Defense (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 workforces to oversee project design and construction, these 
agencies can turn to COE, which already has these 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 Programs 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.
    We only accept agency requests that we can execute without 
impacting our Civil Works or Military Programs missions that are 
consistent with our core technical expertise and that are in the 
National interest.
    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 2013 is projected to be $1.6 
billion, reflecting the completion of ongoing reimbursable work and an 
estimated amount for fiscal year 2013.
                     planning program modernization
    The Corps will continue to implement actions to improve the 
performance of its Civil Works Planning Program through a planning 
modernization effort. This effort focuses on how best to prepare, 
organize, manage, operate, and oversee the planning program to more 
effectively address 21st century water resources challenges. This means 
improved project delivery that yields smarter outcomes; improved 
technical capability of our planners; enhanced collaboration with 
Federal, tribal, State, local and nongovernment partners; evaluating 
and enhancing production capability and staffing at Corps Planning 
Centers of Expertise; and strengthening the objectivity and 
accountability of our planning efforts. Our improved planning 
performance will include:
  --updated planning guidance and policy;
  --streamlined, adaptable planning processes that improve our 
        effectiveness, efficiency, transparency, and responsiveness; 
        and
  --enhanced technical capabilities.
    In fiscal year 2011, the Corps launched a 2-year National Planning 
Pilot Program to test these concepts and to develop and refine 
processes for planning studies across all business lines. This approach 
will be both sustainable and replicable, which will inform future Civil 
Works guidance. Seven to nine pilot studies will be executed over the 
course of this National Planning Pilot Program.
            efficiency and effectiveness of corps operations
    The Corps always strives to continually improve its investigations, 
construction, and operations programs' efficiency and effectiveness. In 
2013, the Corps will further expand the implementation of a modern 
asset management program, using a larger portion of its funds for the 
most important maintenance work, while implementing an energy 
sustainability program that pursues major efficiencies in the 
acquisition and operations of its information technology assets, as 
well as finalizing the reorganization of the Corps' acquisition 
workforce.
  value of the civil works program to the nation's economy and defense
    COE personnel continue to respond whenever needed to assist during 
major floods and other natural disasters. The critical work that they 
perform reduces the risk of damage to people and communities. The 
budget provides $30 million for preparedness for floods, hurricanes, 
and other natural disasters, including funding in support of Corps 
participation of the levee safety and other flood mitigation 
initiatives, including the Silver Jackets program, with a goal of one 
in every State, and to provide unified Federal assistance in 
implementing flood and storm damage reduction solutions.
                        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 by providing 
more cost-effective ways to operate and maintain infrastructure, Civil 
Works program research and development contributes to the national 
economy and our quality of life.
                            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.
    We are proud to serve this great Nation and our fellow citizens, 
and we are proud of the work the Corps does to support America's 
foreign policy, particularly with our ongoing missions in Afghanistan 
and Iraq. Men and women from across the Corps--all volunteers and many 
of whom have served on multiple deployments--continue to provide 
critical support to our military missions there and humanitarian 
support to the citizens of those nations. Currently, 885 Corps 
employees (both civilian and military) are deployed in Iraq and 
Afghanistan. Since these deployments began, the Corps has completed 
more than 9,000 civilian and military projects that were managed by the 
Corps in support of U.S. and Coalition efforts in those countries.
    In Iraq, we completed a more than $15 billion construction program 
and in Afghanistan we have constructed $5 billion worth of work through 
fiscal year 2011. By the end of 2014 we will complete another $10 
billion, for a total Afghanistan program of $15 billion. This critical 
infrastructure and our capacity building efforts will play a key role 
in ensuring stability and security for these nations.
                               conclusion
    The fiscal year 2013 budget represents a continuing, fiscally 
prudent investment in the Nation's water resources infrastructure and 
in the restoration of its aquatic ecosystems. COE is committed to 
change that ensures an open, transparent, and performance-based Civil 
Works program, while remaining focused on consistently delivering 
innovative, resilient, risk-informed solutions to the Armed Forces and 
the Nation.
    Thank you, Madam Chairman and members of subcommittee. This 
concludes my statement.

                       DEPARTMENT OF THE INTERIOR


                         Bureau of Reclamation

STATEMENT OF HON. ANNE CASTLE, ASSISTANT SECRETARY FOR 
            WATER AND SCIENCE
    Senator Feinstein. Secretary Castle, please.
    Ms. Castle. Thank you. Madam Chair, Ranking Member 
Alexander, and members of the subcommittee, I appreciate the 
opportunity to talk to you today about the water-related 
programs of the Department of the Interior and the 2013 budget.
    Commissioner Connor is going to address the specifics of 
the Bureau of Reclamation budget, and I'm going to talk about 
some of Interior's overall programs to address water challenges 
in the West and contribute to the development of renewable 
energy that are contained in the budget.
    It's well known that we're facing unprecedented pressure on 
our water supplies. And that's all across the country, but it's 
particularly in the Western United States. We've got population 
growth, aging infrastructure, and increased demand for water to 
support domestic energy development.
    We have increased recognition of environmental needs. We 
have changing climate. And all of those are challenging already 
scarce water supplies. This Administration puts a very high 
priority on addressing these water challenges.
    Interior's WaterSMART Program (Sustain and Manage America's 
Resources for Tomorrow) Program is designed to do that. It's 
designed to help secure and stretch our water supplies and to 
provide tools to water managers that allow them to work toward 
sustainability.
    Reclamation proposes to fund the WaterSMART Program at $54 
million. The WaterSMART Program includes our WaterSMART grants 
that are funded at $21.5 million, the Basin Studies program 
funded at $6 million, and the Title XVI Recycling and Reuse 
projects that are funded at a little more than $20 million.
    The U.S. Geological Survey (USGS) also has $21 million in 
the 2013 budget requested for WaterSMART programs and that's 
primarily for the water availability and use assessment. These 
WaterSMART programs have a very real and a very positive 
impact.
    We have set the goal of enabling the saving of 730,000 
acre-feet over the 4 years from 2010 to 2013. That's as much 
water as the San Diego County Water Authority uses to serve all 
of its customers for 1 year.
    We're on track to meet that goal. With our programs in 2010 
and 2011, we've enabled the savings of almost 488,000 acre-
feet, and that number is right around the annual use for the 
seven largest cities in the State of Colorado. So we're talking 
about real water savings.
    Another very important focus of the Department of the 
Interior is our New Energy Frontier initiative that's intended 
to foster the development of clean and renewable energy to 
create jobs and to achieve greater energy independence.
    And one of the components of the all-of-the-above energy 
strategy is hydropower. Hydropower is clean, it's efficient, 
it's flexible, and it's a renewable energy resource.
    Reclamation's hydroelectric power plants produce an average 
of 40 million megawatt hours of electricity every year. That's 
enough to meet the needs of more than 3.5 million households.
    Last year, Reclamation released an assessment of the 
hydroelectric potential on its existing dams and reservoirs, 
and that report highlighted 225 megawatts of hydro-potential 
with favorable cost-benefit ratios.
    In the next couple of weeks, we're going to release Phase 2 
of that assessment that looks at the hydropower potential on 
Reclamation's canals and conduits. And we're anticipating that 
we'll see another 100 megawatts of potential on those 
structures.
    These facilities with potential are being made available 
for private development. The Reclamation budget allocates $2 
million to increase clean renewable energy generation by 
integrating renewable technologies into Reclamation projects 
and continuing the effort to optimize our own hydropower 
projects so that we can produce more energy using the same 
amount of water.

                           PREPARED STATEMENT

    Madam Chair, we really appreciate the support that this 
subcommittee has shown for Reclamation's mission, projects, and 
those tangible benefits that you mentioned in your opening 
statement. And we appreciate the support for the mission of the 
Department.
    I look forward to answering your questions.
    [The statement follows:]
                   Prepared Statement of Anne Castle
    Madame Chair, Mr. Alexander, and members of this subcommittee, I am 
pleased to appear before you today to discuss the President's fiscal 
year 2013 budget for the Department of the Interior. I would also like 
to thank the members of this subcommittee for your efforts to enact a 
2012 appropriation, and for your ongoing support for our initiatives.
    The fiscal year 2013 budget builds on that strong foundation with 
$11.5 billion budgeted for the Department of the Interior. The budget 
demonstrates that we can responsibly cut the deficit, while investing 
to win the future and sustain the national recovery. Our budget 
promotes the actions and programs as the President details in his 
``Blueprint for an America Built to Last''; the budget supports 
responsible domestic energy development and advances an America's Great 
Outdoors strategy. The budget continues to advance efforts that you 
have facilitated in renewable energy and sustainable water 
conservation, cooperative landscape conservation, youth in the 
outdoors, and reforms in our conventional energy programs.
    I will discuss the President's fiscal year 2013 budget for the 
Bureau of Reclamation and the Office of the Central Utah Project 
Completion Act (CUPCA), including our proposal to reconsolidate the 
CUPCA Office into Reclamation, and the water-related programs of the 
United States Geological Survey (USGS). I thank the subcommittee for 
your continued support of these programs.
                              introduction
    Interior's mission--to protect America's natural resources and 
cultural heritage and honor the Nation's trust responsibilities to 
American Indians and Alaska Natives--is profound. Interior's people and 
programs impact all Americans.
    The Department of the Interior is the steward of 20 percent of the 
Nation's lands including national parks, national wildlife refuges, and 
the public lands. Interior manages public lands and the Outer 
Continental Shelf, providing access for renewable and conventional 
energy development and overseeing the protection and restoration of 
surface-mined lands. Through the Bureau of Reclamation, Interior is the 
largest supplier and manager of water in the 17 Western States and 
provides hydropower resources used to power much of the country. The 
Department supports cutting edge research in the earth sciences--
geology, hydrology, and biology--to inform resource management 
decisions within Interior and improve scientific understanding 
worldwide. The Department also helps fulfill the Nation's unique trust 
responsibilities to American Indians and Alaska Natives and provides 
financial and technical assistance for the insular areas.
    The Department of the Interior makes significant contributions to 
the Nation's economy. We estimate that it supports more than 2 million 
jobs and approximately $363 billion in economic activity each year. 
Visits to our national parks, cultural and historic sites, refuges, 
monuments and other public lands contribute more than $47 billion in 
economic activity from recreation and tourism. The American outdoor 
industry estimates 1 in 20 U.S. jobs is in the recreation economy. 
Conventional and renewable energy produced on Interior lands and waters 
results in about $230 billion in economic benefits each year, and the 
water managed by Interior is a major contributing factor to more than 
$40.2 billion in agriculture.
                          2011 accomplishments
    Three years ago, Secretary Salazar set Interior on a course to 
create a comprehensive strategy to advance a new energy frontier, 
tackle the impacts of a changing landscape, improve the sustainable use 
of water, engage youth in the outdoors, and improve the safety of 
Indian communities. These priority goals integrate the strengths of the 
Department's diverse bureaus and offices to address key challenges of 
importance to the American public. Interior has been making progress in 
these areas, including:
  --In 2011, the Department of the Interior generated a total of $13.2 
        billion in receipts benefitting the U.S. Treasury--from a 
        combination of royalties, rents and bonuses from mineral, 
        timber, and other natural resource development. Of the total 
        receipts generated by Interior in 2011, $11.3 billion was 
        collected from energy production on public lands, tribal lands, 
        and Federal offshore areas--a $2 billion increase over the 
        previous year--with receipts disbursed among Federal, State, 
        and tribal governments.
  --Since March 2009, 29 onshore projects that increased approved 
        capacity for production and transmission of power have been 
        approved, including the first-ever utility scale solar project, 
        five wind projects, and eight geothermal projects. The Cape 
        Wind Energy Project, approved for construction and operation, 
        is the first-ever offshore commercial wind operation.
  --We continue to make youth a priority, and increased the number of 
        youth employed in conservation activities through Interior or 
        its partners by 31 percent more than the 2009 levels. We 
        launched the YouthGO.gov portal in January 2011, a tool of the 
        Departments of the Interior and Agriculture to provide 
        information on education programs, outdoor activities, and job 
        opportunities.
  --Water Sustain and Manage America's Resources for Tomorrow 
        (WaterSMART), established in 2010, has assisted communities in 
        improving conservation, increasing water availability, 
        restoring watersheds, resolving longstanding water conflicts, 
        addressing the challenges of climate change, and implementing 
        water rights settlements. The WaterSMART grant program has 
        provided more than $85 million in funding to non-Federal 
        partners, including tribes, water districts, and universities. 
        In 2011, we provided $33 million in funding for 82 WaterSMART 
        grant projects.
  --The year 2011 was the second year of a 2-year pilot at four 
        reservations to conduct expanded community policing, equip and 
        train the law enforcement cadre, partner with the communities 
        to organize youth groups and after school programs, and closely 
        monitor results. The results exceeded expectations with a 35 
        percent overall decrease in violent crime in the four 
        communities. Information about the four reservations is being 
        analyzed, and the program will be expanded in 2013 to an 
        additional two communities.
  --In December 2011, the President hosted the third White House Tribal 
        Nations Conference bringing together tribal leaders from across 
        the United States; we are improving the Nation-to-Nation 
        relationship with 565 tribes.
  --The Department advanced key priorities and strategic goals that 
        will improve the conservation and management of natural and 
        cultural resources into the future.
  --Interior and its Federal, State, and tribal partners have created a 
        national network of 22 Landscape Conservation Cooperatives 
        (LCCs) and eight Climate Science Centers (CSCs) in order to 
        address an increasing variety of conservation challenges.
  --In the spirit of America's Great Outdoors, we welcomed new national 
        wildlife refuges in Kansas, the Dakotas, Pennsylvania, and 
        Florida at the headwaters to the Everglades. These refuges mark 
        a new era of conservation for the Department, one that is 
        community-driven, science-based, and takes into account entire 
        ecosystems and working landscapes.
  --The Department worked with others to implement short-term measures 
        and develop a long-term action plan to help address water 
        supply and environmental challenges in the California Bay-Delta 
        area, invested more than $600 million in major water projects 
        over the past 3 years, and moved forward on longstanding water 
        availability issues in the Colorado River Basin.
                         fiscal responsibility
    Interior's fiscal year 2013 budget must be viewed in the context of 
the difficult fiscal times facing the Nation. This budget is 
responsible and austere. Interior's $11.5 billion budget funds 
important investments by eliminating and reducing lower priority 
programs, deferring project start-ups, reducing duplication, 
streamlining operations, and capturing savings. It maintains funding 
levels for core functions that are vital to uphold stewardship 
responsibilities and sustain key initiatives. The fiscal year 2013 
budget includes $10.5 billion for programs funded by the Interior, 
Environment, and Related Agencies appropriation. The fiscal year 2013 
budget for Reclamation, including the CUPCA, is $1 billion in current 
appropriations, $42.4 million below the 2012 enacted level.
    Interior's fiscal year 2013 budget reflects many difficult budget 
choices, cutting worthy programs and advancing efforts to shrink 
Federal spending. Staffing reductions are anticipated in some program 
areas, which will be achieved through attrition, and buy-outs in order 
to minimize the need to conduct reductions in force to the greatest 
extent possible. These reductions are a necessary component of 
maintaining overall fiscal restraint while allowing us to invest 
additional resources in core agency priorities.
                      growing the economy outdoors
    The President's ``Blueprint'' recognizes the economic potential of 
renewable energy development. The economic benefits could be 
particularly significant in America's remote and rural places near 
public lands. The Department's 2010 estimates identified nearly $5.5 
billion in economic impacts associated with renewable energy 
activities, a growing economic sector that supports high-paying jobs.
    Interior is at the forefront of the Administration's comprehensive 
effort to spur job creation by making the United States the world's top 
travel and tourism destination. In a recent statement, President Obama 
cited Department of Commerce figures showing that in 2010, 
international travel resulted in $134 billion in U.S. exports.
    The President has asked Secretary Salazar to co-chair an 
interagency task force with Commerce Secretary Bryson to develop a 
National Travel and Tourism Strategy to expand job creation by 
promoting domestic and international travel opportunities throughout 
the United States. A particular focus of the Task Force will be on 
strategies for increasing tourism and recreation jobs by promoting 
visits to the Nation's national treasures.
    According to a departmental study, in 2010, 437 million visits were 
made by American and international travelers to these lands, 
contributing $47.9 billion in economic activity and 388,000 jobs. Eco-
tourism and outdoor recreation also have an impact on rural economies, 
particularly in Arizona, California, Colorado, Florida, Nevada, North 
Carolina, Oregon, Utah, and Wyoming.
                        america's great outdoors
    The Administration continues to listen to the American public as 
they ask for protection and restoration of our outdoors and to expand 
opportunities for recreation through partnerships with States and 
others and the promotion of America's parks, refuges, and public lands. 
An important element in this effort is the restoration of our rivers to 
both protect the environmental benefits and to secure future water 
supplies. By encouraging innovative partnerships in communities across 
the Nation, the Administration is expanding access to rivers and 
trails, creating wildlife corridors, and promoting conservation while 
working to protect historic uses of the land including ranching, 
farming, and forestry. As part of America's Great Outdoors, Interior is 
supporting 101 signature projects in all States across the country to 
make parks accessible for children, create great urban parks and 
community green spaces, restore rivers, and create recreational 
blueways to power economic revitalization. Projects were selected in 
concert with governors, tribal leaders, private landowners, and other 
stakeholders and were evaluated based on the level of local support, 
the ability of States and communities to leverage resources, and the 
potential to conserve important lands and promote recreation.
    The 2013 America's Great Outdoors initiative focuses on investments 
that will lead to healthy lands, waters, and resources while 
stimulating the economy--goals that are complementary. Through 
strategic partnerships, Interior will support and protect historic uses 
of lands, restore lands and resources, protect and interpret historic 
and cultural resources, and expand outdoor recreation opportunities. 
All of these activities have significant economic benefits in rural and 
urban communities.
    Interior's fiscal year 2013 budget continues to better equip land 
and resource managers with the tools they need to effectively conserve 
resources in a rapidly changing environment. Significant changes in 
water availability, longer and more intense fire seasons, invasive 
species, and disease outbreaks are creating challenges for resource 
managers and impacting the sustainability of resources on public lands. 
These changes result in bark beetle infestations, deteriorated range 
conditions, and water shortages that negatively impact grazing, 
forestry, farming, as well as the status of wildlife and the condition 
of their habitats. Many of these problems are caused by or exacerbated 
by climate change.
    The Department's budget includes $6 million for Reclamation's Basin 
Studies program, which funds Reclamation's partnerships with State and 
local entities to initiate comprehensive water supply and demand 
studies in the West.
    Reclamation continues to participate in and support to the Desert 
and Southern Rockies Landscape Conservation Cooperatives. These LCCs 
are partnerships between Interior and other Federal agencies, States, 
tribes, nongovernmental organizations, and other stakeholders, to bring 
together science and sustainable resource conservation activities to 
develop science-based solutions to on-the-ground challenges from a 
changing environment within an ecological region or ``landscape.'' The 
LCCs leverage the resources and expertise of the partners and work 
across jurisdictional barriers to focus on natural resource issues 
specific to a particular ecosystem or landscape.
                         investing in our youth
    Furthering the youth and conservation goals of the America's Great 
Outdoors initiative, the fiscal year 2013 budget proposes to continue 
engaging youth by employing and educating young people from all 
backgrounds.
    Interior is uniquely qualified to engage and educate young people 
in the outdoors and has programs that establish connections for youth 
ages 18 to 25 with natural and cultural resource conservation. These 
programs help address unemployment in young adults and address health 
issues by encouraging exercise and outdoor activities. For example, 
Interior is taking part in the First Lady's Let's Move initiative to 
combat the problem of childhood obesity. Interior has longstanding 
partnerships with organizations such as the 4-H, the Boy Scouts, the 
Girl Scouts, the Youth Conservation Corps, and the Student Conservation 
Association. These programs leverage Federal investments to put young 
people to work, build a conservation ethic, and educate the next 
generation of land and water stewards.
                            water challenges
    Interior is working to address the 21st century pressures on the 
Nation's water supplies. Population growth, aging water infrastructure, 
changing climate, rising energy demands, impaired water quality, and 
environmental needs are among the challenges to already scarce 
supplies. Water shortage and water use conflicts have become more 
commonplace in many areas of the United States, even in normal water 
years. As competition for water resources grows, the need for 
information and tools to aid water resource managers also grows. 
Traditional water management approaches no longer meet today's needs.
    In 2010, the Secretary issued a Secretarial Order establishing the 
WaterSMART program which embodies a new water sustainability strategy. 
WaterSMART coordinates Interior's water sustainability efforts, creates 
a clearinghouse for water conservation best practices and implements a 
Department-wide water footprint reduction program to reduce consumption 
of potable water by 26 percent by 2020.
    Reclamation proposes to fund the rebased WaterSMART at $53.9 
million, $6.8 million above 2012 enacted levels. The three ongoing 
WaterSMART programs include:
  --the WaterSMART Grant program funded at $21.5 million;
  --Basin Studies funded at $6 million; and
  --the title XVI Water Reclamation and Reuse program funded at $20.3 
        million.
    The rebasing adds the existing Water Conservation Field Services 
program, funded at $5.9 million, and participation by Reclamation in 
the Cooperative Watershed Management program, funded at $250,000. 
WaterSMART is a joint effort with the USGS. The USGS fiscal year 2013 
budget includes $21 million, an increase of $13 million more than the 
2012 enacted level, for the USGS WaterSMART Availability and Use 
Assessment program.
    In November 2011, the Department adopted the WaterSMART Strategic 
Implementation Plan, which discusses the coordination of activities 
across bureaus, and the contributions they will make in providing 
Federal leadership toward a sustainable water resources future. In 
December 2011, we released a report on a pilot project within the 
Colorado River Basin. This report represents a snapshot of Interior's 
WaterSMART activities within the Basin and demonstrates the diversity 
and significance of several ongoing Federal, State, tribal, local, and 
nongovernmental cooperative efforts that are underway. It also 
demonstrates the effectiveness of the WaterSMART program, and the 
importance of these coordinated efforts to the sustainability of 
resources in the Colorado River Basin.
    Other significant programs and highlights specific to Reclamation 
include:
  --We are in dialogue with Mexico on the management of the Colorado 
        River. We have ongoing efforts to improve our management of 
        resources on the Colorado River, from renewable hydropower 
        development near the headwaters to a pilot program of 
        desalination near the Mexican border. We are completing 
        environmental compliance on a new protocol for high-flow 
        releases from Glen Canyon Dam to improve and protect downstream 
        resources. We have begun the process for updating the long-term 
        plan of operations for Glen Canyon Dam to incorporate the 
        scientific advancements that have occurred since the last plan 
        was finalized, more than 15 years ago.
  --We are actively pursuing workable solutions to regional issues such 
        as in the California Bay-Delta. The Bay-Delta is a source of 
        drinking water for 25 million Californians and sustains about 
        $400 billion in annual economic activity, including a $28 
        billion agricultural industry and up until recently supported a 
        thriving commercial and recreational fishing industry. Our 
        efforts in the Bay-Delta are focused on co-leading an inter-
        agency effort with the Council on Environmental Quality (CEQ) 
        to implement the December 2009 Interim Federal Action Plan for 
        the California Bay-Delta. In coordination with five other 
        Federal agencies, we are leveraging our activities to work in 
        concert with the State and local authorities to encourage the 
        smarter supply and use of water, ensure healthy ecosystems and 
        water quality, help deliver drought relief services, and ensure 
        integrated flood risk management. Over the past 3 years, we 
        have invested more than $600 million in water projects in 
        California. This funding supports the co-equal goals of 
        providing a more reliable water supply for California and 
        protecting, restoring, and enhancing the Bay-Delta ecosystem. 
        We have also, in close coordination with NOAA and the State of 
        California, worked on the California Bay-Delta Conservation 
        Plan, a long-term plan aimed at restoring both reliable water 
        supplies and a healthy Bay-Delta ecosystem.
    On February 22, 2012, we announced the initial Water Supply 
Allocation for Central Valley Project (CVP) water users. Even though 
2011 was a wet water year that allowed reservoirs to fill and provided 
abundant flows in the Sacramento and San Joaquin river systems, the 
exceedingly dry conditions earlier this winter pose risks to threatened 
and endangered fish species, as well as to the water supplies of the 
CVP. Interior, Reclamation, State and local agencies, and other 
interested parties are working together to identify and secure 
additional water supplies and create opportunities that will aid water 
management in California. We will continue to work with our Federal, 
State, and local partners to improve water supply reliability while 
addressing significant ecological issues. Reclamation is continuing to 
update the forecast to provide the most current information to its 
stakeholders.
                       innovation through science
    Sustainable stewardship of natural resources requires strong 
investments in research and development (R&D) in the natural sciences. 
Research and development funding is increased by $64 million in the 
Department's fiscal year 2013 budget, with R&D funding increases among 
all of the Interior bureaus, and particularly USGS with a $51 million 
increase to fund R&D priorities in disaster response, hydraulic 
fracturing, coastal and ocean stewardship, and ecosystem restoration. 
The fiscal year 2013 budget includes R&D funding of $10.1 million for 
Reclamation to address climate change adaptation, control invasive 
quagga mussels, improve desalination technologies, and promote 
renewable energy development.
                          new energy frontier
    The fiscal year 2013 budget continues Interior's New Energy 
Frontier initiative to create jobs and achieve greater energy 
independence. The Administration's blueprint for energy security 
focuses on safely and responsibly developing our domestic energy 
resources, including both conventional and renewable resources. The 
Department plays an important role by providing opportunities for safe 
and responsible development on public lands and on the U.S. Outer 
Continental Shelf.
                               hydropower
    Hydropower is a very clean and efficient way to produce energy and 
is a renewable resource. Each kilowatt-hour of hydroelectricity is 
produced at an efficiency of more than twice that of any other energy 
source. Further, hydropower is very flexible and reliable when compared 
to other forms of generation. Reclamation has nearly 500 dams and 
10,000 miles of canals and owns 58 hydropower plants, 53 of which are 
operated and maintained by Reclamation. On an annual basis, these 
plants produce an average of 40 million megawatt (MW) hours of 
electricity, enough to meet the entire electricity needs of more than 
3.5 million households on average.
    Reclamation and Federal Energy Regulatory Commission (FERC) are 
parties to a Memorandum of Understanding (MOU), signed in 1992, that 
addresses the establishment of processes for early resolution of issues 
related to the timely development of non-Federal hydroelectric power at 
Bureau of Reclamation facilities. Reclamation and FERC recently met to 
discuss how to improve the timeliness of the processes developed in 
that MOU and resolution of authority issues.
    The Department signed a MOU with the Department of Energy and COE 
on March 24, 2010 to increase communication between Federal agencies 
and strengthen the long-term relationship among them to prioritize the 
generation and development of sustainable hydropower. This 
Administration is committed to increasing the generation of 
environmentally sustainable, affordable hydropower for our national 
electricity supplies in as efficient a manner as possible. Activities 
under this MOU have been ongoing, and have resulted in accomplishments 
such as assessments of potential hydropower resources on Federal and 
non-Federal lands, a collaborative basin-scale pilot project in Oregon, 
and grant opportunities for R&D of new technologies. An example of its 
on-going efforts to maximize potential generation at existing Federal 
facilities, Reclamation has assessed the potential for developing 
hydropower at existing Reclamation facilities and by utilizing low-head 
hydroelectric generating capacity on Reclamation-owned canals and 
conduits. A report on this assessment will be released within the next 
few weeks.
    The budget allocates $2 million to increase clean renewable energy 
generation by exploring how renewable technologies including solar, 
small hydropower, and hydrokinetics can be integrated into Reclamation 
projects; by continuing the effort to optimize Reclamation hydropower 
projects to produce more energy with the same amount of water; by 
investigating hydro pump-storage projects that can help integrate large 
amounts of variable renewable resources such as wind and solar into the 
electric grid; and by working with tribes to assist them in developing 
renewable energy sources.
                   indian land and water settlements
    Interior's fiscal year 2013 budget includes $82.8 million in the 
Bureau of Reclamation and Bureau of Indian Affairs (BIA) to implement 
land and water settlements.
    The Department has a unique responsibility to American Indians and 
Alaska Natives, which is upheld by Interior's support for a robust 
Government-to-government relationship as demonstrated by a new 
comprehensive and transparent consultation policy that ensures there is 
a strong, meaningful role for tribal governments.
    In 2011, Interior started planning to implement the landmark $3.4 
billion settlement of the Cobell v. Salazar lawsuit, and appointed a 
Secretarial Commission on Trust Administration and Reform to oversee 
implementation of the Settlement agreement. The Commission is 
undertaking a forward-looking, comprehensive evaluation of Interior's 
management of nearly $4 billion in American Indian trust funds--with 
the goal of making trust administration more transparent, responsive, 
customer focused, and accountable.
    The Claims Resolution Act of 2010 settled the Cobell lawsuit and 
four settlements that will provide permanent water supplies and 
economic security for the Taos Pueblo of New Mexico and Pueblos of New 
Mexico named in the Aamodt case, the Crow Tribe of Montana, and the 
White Mountain Apache Tribe of Arizona. The agreements will enable 
construction and improvement of reservation water systems, irrigation 
projects, a regional multipueblo water system, and codify water-sharing 
arrangements between Indian and neighboring communities. The primary 
responsibility for constructing water systems associated with the 
settlements was given to Reclamation; and BIA is responsible for the 
majority of the trust funds.
    Reclamation is budgeting $21.5 million in 2013 for the continued 
implementation of these four settlements and $25 million for the 
Navajo-Gallup Water Supply project. Reclamation is proposing the 
establishment of an Indian Water Rights Settlements account to assure 
continuity in the construction of the authorized projects and to 
highlight and enhance transparency.
                          central utah project
    CUPCA, titles II-VI of Public Law 102-575, provides for completion 
of the Central Utah Project (CUP) by the Central Utah Water Conservancy 
District (District). The Act also authorizes funding for fish, 
wildlife, and recreation mitigation and conservation; establishes an 
account in the Treasury for deposit of these funds and other 
contributions; establishes the Utah Reclamation Mitigation and 
Conservation Commission to coordinate mitigation and conservation 
activities; and provides for the Ute Indian Rights Settlement.
    The fiscal year 2013 budget proposes to reconsolidate the CUPCA 
Office and program into the Bureau of Reclamation. This consolidation 
is part of broader administration efforts to implement good Government 
solutions to consolidate and streamline activities. The CUP is the only 
water project within the Department of the Interior not managed by 
Reclamation. The proposed merger would correct that anomaly, ensuring 
that these projects receive equal and consistent consideration and 
treatment. Concerns about Reclamation's previous management and 
operation of the CUP have been addressed within Reclamation and 
corrected. The fiscal year 2013 CUPCA budget is $21 million, a decrease 
of $7.7 million from the 2012 enacted level. Of this amount, $1.2 
million will be transferred to the Utah Reclamation Mitigation and 
Conservation Account for use by the Utah Reclamation Mitigation and 
Conservation Commission (Mitigation Commission). We propose to maintain 
both the Central Utah Project Completion and the Utah Reclamation 
Mitigation and Conservation Accounts for CUPCA appropriations after the 
proposed consolidation of the CUPCA Office into Reclamation in order to 
enhance transparency.
    The fiscal year 2013 budget includes $17.3 million for use by the 
District to continue construction of the Utah Lake System facilities 
and to implement approved water conservation and water management 
improvement projects. The Act requires a local cost share of 35 percent 
for projects implemented by the District which increases the 
effectiveness of the program. The budget for the District includes $7.3 
million to fund the designs, specifications, land acquisition, and 
construction of the Utah Lake System, a decrease of $6.7 million from 
the 2012 enacted level. The budget also includes water conservation 
measures at $10 million for construction of the Provo River Canal 
Enclosure Project, which when completed will provide 8,000 acre-feet of 
conserved water for endangered fish and convey 30,000 acre-feet of CUP 
water.
    The fiscal year 2013 budget includes $1.2 million for the 
Mitigation Commission to implement the fish, wildlife, and recreation 
mitigation and conservation projects authorized in title III ($1 
million) and to complete mitigation measures committed to in pre-1992 
Bureau of Reclamation planning documents ($200,000), all of which are 
necessary to allow CUP operations.
    Finally, the budget includes $1.2 million for the Program Office 
for endangered species recovery and operation and maintenance costs 
associated with instream flows and fish hatchery facilities and $1.3 
million for program administration.
                               conclusion
    Thank you for the opportunity to testify on behalf of the 
President's fiscal year 2013 budget for the Department of the Interior 
and the Bureau of Reclamation. I want to reiterate my appreciation for 
the longstanding support of this subcommittee. This budget has fiscal 
discipline and restraint, but it also includes forward-looking 
investments. We have a tremendous opportunity to improve the future for 
all generations with wise investments in healthy lands, clean waters, 
and expanded energy options.
    I look forward to working with you to implement this budget. This 
concludes my testimony. I am happy to answer any questions that you may 
have.

    Senator Feinstein. Thank you, Madam Secretary.
    Commissioner Connor.
STATEMENT OF MICHAEL L. CONNOR, COMMISSIONER
    Mr. Connor. Yes. Thank you, Madam Chair, Ranking Member 
Alexander, and members of the subcommittee, for the opportunity 
to discuss Reclamation's fiscal year 2013 budget request.
    The overall request for Reclamation is $1 billion. I have 
submitted detailed written testimony for the record. The budget 
reflects a comprehensive set of actions and initiatives that 
support Reclamation's mission as well as hundreds of thousands 
of jobs in the Western United States.
    Reclamation is employing an all-of-the-above strategy in 
the area of water resources. Certainty and sustainability are 
primary goals with respect to the use of water resources and 
require Reclamation to take action on many fronts and our 
budget proposal was developed with that in mind.
    To help meet the water and energy needs of the 21st 
century, we must continue to maintain and improve existing 
infrastructure, develop new infrastructure, conserve and make 
more efficient use of limited water resources, protect the 
environment, better understand and plan for future challenges, 
and help clarify the relative rights to use water.
    I'll briefly summarize areas of particular interest in our 
budget. Infrastructure. Overall, the budget supports the need 
to maintain our infrastructure in safe operating condition. 
Approximately 52 percent of the water and related resources 
account is dedicated to operation, maintenance, and replacement 
(OM&R) activity with 48 percent allocated to resource 
management and development.
    OM&R include the Dam Safety program, Site Security program, 
and Replacements, Additions, and Extraordinary Maintenance 
(RAX).
    A second priority area is WaterSMART. Secretary Castle 
summarized our WaterSMART initiative. I'll simply reiterate 
that WaterSMART is yielding significant results West-wide and 
demand greatly exceeds available resources at this point in 
time.
    Ecosystem Restoration is a third-priority area. In order to 
meet Reclamation's mission goals of producing power and 
delivering water in a sustainable manner, we simply must 
continue to focus on the protection and restoration of the 
aquatic and riparian environments affected by our projects.
    Specifically, the 2013 request provides substantial funding 
for a number of restoration programs in California including 
the Central Valley Project (CVP) Improvement Act, San Joaquin 
River Restoration, Trinity River Restoration, and Bay-Delta 
initiatives.
    And our ESA Recovery and Compliance Programs have received 
specific authorization from Congress and also enjoy broad 
support from diverse interests.
    Fourth, Cooperative Landscape Conservation is a 
Departmental initiative in which Reclamation is actively 
engaged. We are developing and implementing approaches to 
understand and effectively adapt to the array of challenges 
facing Western water management. Reclamation's Basin Studies 
and Science and Technology programs are key efforts in this 
area.
    Fifth, to support the Department's New Energy Frontier 
Initiative, the 2013 budget allocates funding to specifically 
support Reclamation-wide Renewable Energy Initiatives and to 
collaborate with other entities on renewable energy 
integration.
    Once again, Secretary Castle discussed our efforts in this 
area and their yielding of significant results and all are part 
of the President's all-of-the-above strategy for meeting the 
country's energy needs.
    Sixth, and finally, Reclamation has a longstanding 
commitment to the Secretary's goal of strengthening tribal 
nations. The 2013 budget supports this goal through a number of 
activities including fisheries restoration, rural water 
projects, and the implementation of the new Water Right 
Settlements.
    Reclamation has a large role in implementing settlements 
and our goals are simple: help tribes realize settlement 
benefits as quickly as possible; two, ensure certainty in the 
use of water for tribes and their non-Indian neighbors; and 
three, promote economic prosperity in Indian country in both 
the short term and the long term.

                           PREPARED STATEMENT

    Madame Chair, as Secretary Castle mentioned, we greatly 
appreciate your support for our programs and efforts at the 
Bureau of Reclamation, and I'm happy to answer questions at the 
appropriate time.
    [The statement follows:]
                Prepared Statement of Michael L. Connor
                              introduction
    Thank you Madame Chair, Mr. Alexander, and members of this 
subcommittee, for the opportunity to discuss with you the President's 
fiscal year 2013 budget for the Bureau of Reclamation.
    I appreciate the time and consideration this subcommittee gives to 
reviewing and understanding Reclamation's budget and its support for 
the program. Reclamation works hard to prioritize and define our 
program in a manner that serves the best interest of the public.
    Our fiscal year 2013 budget continues support for activities that, 
both now and in the future, will deliver water and generate power, 
consistent with applicable State and Federal law, in an environmentally 
responsible and cost-effective manner. Overall, our goal is to promote 
certainty, sustainability, and resiliency for those who use and rely on 
water resources in the West. Success in this approach will help ensure 
that Reclamation is doing its part to support the basic needs of 
communities, as well as provide for economic growth in the 
agricultural, industrial, energy, and recreational sectors of the 
economy. In keeping with the President's pledge to reduce spending and 
focus on deficit reduction, this budget reflects reductions and savings 
where possible. The fiscal year 2013 budget allows Reclamation to 
fulfill its core mission, but cost savings have been implemented where 
possible.
    The budget also supports the Administration's and Department of the 
Interior's (Department) priorities to tackle America's water 
challenges; promote America's Great Outdoors and Cooperative Landscape 
Conservation; and support and strengthen tribal nations. The Department 
will continue the Water Sustain and Manage America's Resources for 
Tomorrow (WaterSMART) program (with participation from both Reclamation 
and the United States Geological Survey) and Reclamation's budget 
reflects that priority.
    Reclamation's fiscal year 2013 budget is $1 billion, $42.4 million 
below the fiscal year 2012 enacted level. Reclamation's budget request 
is partially offset by discretionary receipts in the Central Valley 
Project Restoration Fund, estimated to be $39.6 million. The request 
for permanent appropriations in 2013 totals $174.1 million. The budget 
proposes the establishment of a new Indian Water Rights Settlement 
account and a discretionary appropriation for the San Joaquin River 
Restoration Fund.
    As the largest supplier and manager of water in the 17 Western 
States and the Nation's second largest producer of hydroelectric power, 
Reclamation's projects and programs are critical to driving and 
maintaining economic growth in the Western States. Reclamation manages 
water for agricultural, municipal and industrial use, and provides 
flood control and recreation for millions of people. According to a 
June 2011 economic report prepared by the Department, Reclamation 
activities, including recreation, have an economic contribution of $55 
billion, and support nearly 416,000 jobs. Reclamation's 58 
hydroelectric power plants generate more than 40 million megawatt hours 
of electricity to meet the annual needs of more than 3.5 million 
households and generates nearly $940 million in revenues for the 
Federal Government. It would take more than 23.5 million barrels of 
crude oil or about 6.8 million tons of coal to produce an equal amount 
of energy with fossil fuel. As a result, Reclamation facilities 
eliminate the production of more than 27 million tons of carbon dioxide 
that would have been produced by fossil fuel power plants.
    The fiscal year 2013 budget allocates funds to projects and 
programs based on objective, performance-based criteria to most 
effectively implement Reclamation's programs and its management 
responsibilities for its water and power infrastructure in the West.
                      water and related resources
    The fiscal year 2013 budget for Water and Related Resources, 
Reclamation's principal operating account, is $818.6 million, a 
decrease of $76.4 million from the fiscal year 2012 enacted level. This 
decrease is due, in part, to a shift of $46.5 million for the proposed 
establishment of the Indian Water Rights Settlement account, and $12 
million for a discretionary appropriation for the San Joaquin River 
Restoration Fund.
    The fiscal year 2013 budget includes a total of $395.6 million at 
the project/program level for water, energy, land, and fish and 
wildlife resource management and development activities. Funding in 
these activities provides for planning, construction, water 
sustainability activities, management of Reclamation lands including 
recreation areas, and actions to address the impacts of Reclamation 
projects on fish and wildlife.
    The budget also provides a total of $423.1 million at the project/
program level for the operation, maintenance, and rehabilitation 
associated with Reclamation's water and power facilities. Reclamation 
emphasizes safe, efficient, economic, and reliable operation of 
facilities, ensuring systems and safety measures are in place to 
protect the facilities and the public. Providing adequate funding for 
these activities continues to be one of Reclamation's highest 
priorities.
    highlights of the fiscal year 2013 budget for water and related 
                               resources
    I would like to share with the subcommittee several highlights of 
the Reclamation budget including an update on the WaterSMART program, 
and the Department's priority goal target to enable capability to 
increase available water supply in the Western United States by 730,000 
acre-feet by the end of 2013 based on cumulative savings since 2009.
    WaterSMART Program.--The fiscal year 2013 budget continues to focus 
resources on expanding and stretching limited water supplies in the 
West to reduce conflict, facilitate solutions to complex water issues, 
and meet the growing needs of expanding municipalities, domestic energy 
development, the environment, and agriculture.
    Reclamation proposes to fund WaterSMART at $53.9 million, $6.8 
million above the fiscal year 2012 enacted level. There are five 
ongoing WaterSMART programs:
  --the WaterSMART Grant program, funded at $21.5 million;
  --Basin Studies, funded at $6 million;
  --the title XVI Water Reclamation and Reuse program, funded at $20.3 
        million;
  --Water Conservation Field Services program, funded at $5.9 million; 
        and
  --the Cooperative Watershed Management program, funded at $250,000.
    Reclamation has budgeted $6.5 million to actively engage in 
developing and implementing approaches to understand, and effectively 
adapt to landscape-level conservation challenges, including the impacts 
of climate change on western water management. The Basin Studies 
program is part of an integrated strategy to respond to changing 
impacts on the resources managed by Interior, and is a key component of 
the WaterSMART initiative. In 2013, the Basin Studies program will 
continue West-wide risk assessments, coordinated through the 
Department's Landscape Conservation Cooperatives (LCCs) and focus on 
the threats to water supplies from changing weather patterns. 
Reclamation will continue to participate in and lead the Desert and 
Southern Rockies LCCs. Included within Reclamation's Science and 
Technology program is water resources research targeting improved 
capability for managing water resources under multiple drivers, 
including a changing climate. This research agenda will be collaborated 
and leveraged with capabilities of the Interior Climate Science 
Centers.
    Supporting Renewable Energy Initiatives.--To support the 
Administration's New Energy Frontier initiative, and the Renewable 
Energy priority goal, the 2013 Reclamation budget allocates $2 million 
to provide support for the renewable energy initiative and to 
collaborate with other agencies and entities on renewable energy 
integration. The funds will be used to explore how other renewable 
energy technologies can be integrated into Reclamation projects. 
Reclamation will continue the effort to facilitate the development of 
sustainable hydropower; optimize Reclamation hydropower projects to 
produce more energy with the same amount of water; explore hydro pump-
storage projects that can help integrate large amounts of variable 
renewable resources such as wind and solar into the electric grid; and 
work with tribes to assist them in developing renewable energy sources. 
These important projects can help produce cleaner, renewable energy.
    Supporting Tribal Nations.--Reclamation has a longstanding 
commitment to realizing the Secretary's goal to strengthen tribal 
nations. The fiscal year 2013 budget continues to support that goal 
through a number of activities and projects ranging from ecosystem 
restoration to rural water infrastructure and the implementation of 
water rights settlement. The budget includes $6.4 million for the 
Native American Affairs Program to continue support of Reclamation 
activities with Indian tribes. These activities include providing 
technical support for Indian water rights settlements and assisting 
tribal governments to develop, manage, and protect their water and 
related resources. Also, the office provides policy guidance for 
Reclamation's work with tribes throughout the organization in such 
areas as the Indian trust responsibility, Government-to-government 
consultations, and Indian self-governance and self-determination.
    Rural Water Projects.--The Congress has specifically authorized 
Reclamation to undertake the design and construction of seven projects 
intended to deliver potable water supplies to specific rural 
communities in the West. Reclamation has been working diligently to 
advance the completion of all of its authorized rural water projects 
consistent with current fiscal and resource constraints with the goal 
of delivering potable water to tribal and non-tribal residents within 
the rural water project areas. In support of rural communities, the 
fiscal year 2013 budget includes a funding increase to advance the 
construction of rural water projects.
    Reclamation has proposed $69.6 million in funding for Reclamation's 
seven on-going authorized rural water projects. This funding reflects 
the high priority that the Department and Reclamation place on 
improving the circumstances of rural economies and those living in 
rural economies. Tribal and non-tribal people will greatly benefit by 
this demonstrated commitment to rural water construction.
    Specifically, the budget includes $18 million for operation and 
maintenance of tribal features for two projects--the Mni Wiconi Project 
and the Garrison Diversion Unit of the Pick-Sloan Missouri Basin 
Program--and $51.6 million in construction funding combined for the 
seven projects:
  --Garrison Diversion Unit, (North Dakota);
  --Mni Wiconi Rural Water System, (South Dakota);
  --Jicarilla Apache Reservation Rural Water System, (New Mexico);
  --Lewis and Clark Rural Water System, (South Dakota, Iowa, 
        Minnesota);
  --Fort Peck Reservation/Dry Prairie Rural Water System, (Montana);
  --Rocky Boys/North Central Montana Rural Water System, (Montana); and
  --Eastern New Mexico Water Supply Project, (New Mexico).
    The fiscal year 2013 budget includes sufficient funding to complete 
construction of the Mni Wiconi Project.
    Aging Infrastructure.--In recognition of the growing need to 
address aging infrastructure associated with Reclamation projects, the 
2013 Reclamation budget includes $7.3 million for a Reclamationwide 
Aging Infrastructure program that will make use of recently enacted 
authorities such as the aging infrastructure program enacted in Public 
Law 111-11. This funding will address the infrastructure needs of 
Reclamation projects, which is essential for maintaining system 
reliability and safety and to support sustainable water management by 
promoting established asset management practices. This budget will 
provide additional funding for an increased number of extraordinary 
maintenance and rehabilitation activities which will enhance the 
ability of Reclamation and its operating entities to preserve the 
structural safety of project facilities, while continuing delivery of 
project benefits.
    Dam Safety Program.--A total of $87.5 million is budgeted for 
Reclamation's Safety of Dams program. This includes $67 million 
directed to specific dam safety modifications; of which $15 million is 
for work at Folsom Dam. Funding also includes $19.4 million for safety 
evaluations of existing dams and $1.1 million to oversee the Interior 
Department's Safety of Dams program.
    Site Security.--A total of $26.9 million is budgeted for Site 
Security to ensure the safety and security of the public, Reclamation's 
employees, and key facilities. This funding includes $5.9 million for 
physical security upgrades at high-risk critical assets and $21 million 
to continue all aspects of bureau-wide security efforts.
    This includes law enforcement, risk and threat analysis, personnel 
security, information security, risk assessments and security-related 
studies, and guards and patrols.
    Ecosystem Restoration.--In order to meet Reclamation's mission 
goals of generating power and managing water in a sustainable manner 
for the 21st century, one focus of its programs must be the protection 
and restoration of the aquatic and riparian environments affected by 
its operations. Ecosystem restoration involves a large number of 
activities, including Reclamation's Endangered Species Act recovery 
programs, which directly address the environmental aspects of the 
Reclamation mission. These programs also implement important river 
restoration efforts that support the America's Great Outdoors 
initiative.
    The fiscal year 2013 budget provides $128 million to operate, 
manage, and improve the Central Valley Project. This amount includes 
$16.1 million for the Trinity River Restoration program, and $2.9 
million for the Red Bluff fish passage to complete postconstruction 
activities of the new pumping plant and fish screen, which will be 
operational in the spring of 2012, as well as continued biological and 
research and monitoring activities.
    The budget provides $27.2 million for Lower Colorado River 
Operations to both fulfill the role of the Secretary as water master 
for the Lower Colorado River and continue the multispecies conservation 
program, which is $17.8 million of that total, and provides long-term 
Endangered Species Act compliance for the river operations.
    The budget includes $18.9 million for Endangered Species Act 
Recovery Implementation programs, which includes $8 million in the 
Great Plains Region to implement the Platte River Endangered Species 
Recovery Implementation program. This funding will facilitate the 
implementation of measures to help recover four endangered or 
threatened species, thereby enabling existing water projects in the 
Platte River Basin to continue operations, as well as allowing new 
water projects to be developed in compliance with the Endangered 
Species Act. This program also includes $8.4 million for the Upper 
Colorado and San Juan River Endangered Fish Recovery programs. This 
funding will continue construction of a system that automates canal 
operations to conserve water by matching river diversions with actual 
consumptive use demands and redirecting the conserved water to improve 
in-stream flows. The budget also provides $18 million for Columbia/
Snake River Salmon Recovery. This funding will be used for the 
implementation of required Biological Opinion actions including 
extensive hydro actions, plus tributary habitat and hatchery 
initiatives as off-sets for the impacts of Federal Columbia River Power 
System operations.
    The fiscal year 2013 budget includes $7.1 million for Reclamation 
to move forward with actions that address water supply enhancement and 
restoration of natural resources that support the Klamath Basin 
Restoration Agreement and are authorized under existing law. The 
Klamath Basin Restoration Agreement includes restoration and related 
activities to reduce conflicts over water between the Upper and Lower 
Klamath Basins.
    The results of the Klamath Dam Removal and Sedimentation Studies 
conducted over the past several years will be used in discussions over 
whether or not removing PacifiCorp's four dams on the Lower Klamath 
River is in the public interest and advances restoration of the Klamath 
River fisheries. No funds are budgeted in 2013 for this effort.
    The fiscal year 2013 budget includes $22.5 million for the Middle 
Rio Grande project. Within this amount $8.4 million supports the 
acquisition of supplemental non-Federal water for Endangered Species 
Act efforts and low flow conveyance channel pumping into the Rio Grande 
during the irrigation season. Further, funding will be used for 
recurring river maintenance necessary to ensure uninterrupted, 
efficient water delivery to Elephant Butte Reservoir, reduced risk of 
flooding, as well as water delivery obligations to Mexico.
    The Yakima River Basin Water Enhancement project budget is $9.5 
million, which will continue funding grants to implement conservation 
measures that stretch water supplies and improve fishery conditions.
                  central utah project completion act
    The fiscal year 2013 budget proposes to consolidate the Central 
Utah Project Completion Act (CUPCA) program with the Bureau of 
Reclamation, while maintaining a separate appropriations account for 
CUPCA. This consolidation is part of broader administration efforts to 
implement good Government solutions to consolidate and streamline 
activities when possible. The proposed merger would ensure that all 
major Federal water projects within Interior are managed by 
Reclamation, ensuring that these projects receive equal consideration 
and treatment. The fiscal year 2013 CUPCA budget is $21 million, a 
decrease of $7.7 million from the fiscal year 2012 enacted level. Of 
this amount, $1.2 million will be transferred to the Utah Reclamation 
Mitigation and Conservation Account for use by the Mitigation 
Commission.
                central valley project restoration fund
    The fiscal year 2013 budget includes $39.9 million for the Central 
Valley Project Restoration Fund (CVPRF), a decrease of $13.2 million 
from the fiscal year 2012 enacted level. This budget is indexed to 1992 
price levels and determined on the basis of a 3-year rolling average. 
This budget is offset by collections estimated at $39.6 million from 
mitigation and restoration charges authorized by the Central Valley 
Project Improvement Act (CVPIA). The fund supports a number of programs 
authorized by the CVPIA, including anadromous fish restoration and the 
acquisition and delivery of water to State and Federal wildlife 
refuges.
                    california bay-delta restoration
    The fiscal year 2013 budget includes $36 million for CALFED, 
pursuant to the CALFED Bay-Delta Authorization Act, a decrease of $3.7 
million from the 2012 enacted level. The budget will support 
implementation of the Bay Delta Conservation Plan, under the following 
new program activities--$1.9 million for a Renewed Federal-State 
Partnership, $6.6 million for Smarter Water Supply and Use, and $27.6 
million for actions that address the Degraded Bay-Delta Ecosystem.
                   san joaquin river restoration fund
    The fiscal year 2013 budget funds activities consistent with the 
settlement of Natural Resources Defense Council v. Rodgers as 
authorized by the San Joaquin River Restoration Settlement Act. The Act 
included a provision establishing the San Joaquin River Restoration 
Fund to implement the provisions of the Settlement. The Settlement's 
two primary goals are to restore and maintain fish populations, and 
restore and avoid adverse water impacts. Under the Settlement, the 
legislation provides for approximately $2 million in annual 
appropriations from the Central Valley Project Restoration Fund for 
this purpose, as well as permanent funds of $88 million. The 
legislation also authorized appropriations and Reclamation proposes $12 
million of discretionary funds for the San Joaquin Restoration Fund 
account in 2013.
                    indian water rights settlements
    The fiscal year 2013 budget includes $46.5 million in the proposed 
Indian Water Rights Settlement account. Of this amount, $21.5 million 
is for implementation of the four settlements included in the Claims 
Resolution Act of 2010. These settlements will deliver clean water to 
the Taos Pueblo of New Mexico, the Pueblos of New Mexico named in the 
Aamodt case, the Crow Tribe of Montana, and the White Mountain Apache 
Tribe of Arizona. Reclamation is proposing the establishment of an 
Indian Water Rights Settlements account to assure continuity in the 
construction of the authorized projects and to highlight and enhance 
transparency in handling these funds.
    In addition to the four settlements, the account also budgets $25 
million for the on-going Navajo-Gallup Water Supply Project (authorized 
in title X of Public Law 111-11). The total for Reclamation's 
implementation of Indian Water Rights Settlements in 2013 is $106.5 
million, $46.5 million in discretionary funding and $60 million in 
permanent authority, which is provided in title VII of the Claims 
Resolution Act.
                       policy and administration
    The fiscal year 2013 budget for the Policy and Administration 
appropriation account, the account that finances Reclamation's central 
management functions, is $60 million.
                        research and development
    Reclamation's Science and Technology Program focuses on a range of 
solutions for supporting the bureau's capability to manage, conserve, 
and expand water supplies. This year Reclamation's budget includes $13 
million to support research and development programs which give the 
highest priority to address the impacts of drought and climate change; 
mitigation of invasive species such as zebra and quagga mussels; 
creating new water supplies through advanced water treatment; and 
advance renewable energy development on Reclamation lands.
                        permanent appropriations
    The total permanent appropriation in 2013 of $174.1 million 
includes $111.1 million for the Colorado River Dam Fund and $60 million 
for Reclamation's Indian Water Rights Settlements account.
                         campaign to cut waste
    Over the last 2 years, the Administration has implemented a series 
of management reforms to curb growth in contract spending, terminate 
poorly performing information technology projects, deploy state-of-the-
art fraud detection tools, focus agency leaders on achieving ambitious 
improvements in high-priority areas, and open Government up to the 
public to increase accountability and accelerate innovation.
    In November 2011, President Obama issued an Executive order 
reinforcing these performance and management reforms and the 
achievement of efficiencies and cost-cutting across the Government. 
This Executive order identifies specific savings as part of the 
Administration's Campaign to Cut Waste to achieve a 20-percent 
reduction in administrative spending from 2010 to 2013. Each agency was 
directed to establish a plan to reduce the combined costs associated 
with travel, employee information technology devices, printing, 
executive fleet efficiencies, and extraneous promotional items and 
other areas.
    The Department of the Interior's goal is to reduce administrative 
spending by the end of 2013, $207 million from 2010 levels. To 
contribute to that goal, the Bureau of Reclamation is targeted to save 
$13.5 million by the end of 2013.
         fiscal year 2013 priority goal for water conservation
    Priority goals are a key element of the President's agenda for 
building a high-performing Government. The priority goals demonstrate 
that they are a high value to the public or that they reflect 
achievement of key departmental milestones. These goals focus attention 
on initiatives for change that have significant performance outcomes 
which can be clearly evaluated, and are quantifiable and measurable in 
a timely manner. Reclamation's participation in the Water Conservation 
priority goal helps to achieve these objectives.
    Reclamation's water conservation efforts are critical to sustain 
the economy, environment, and culture of the American West. Competition 
for finite water supplies is increasing because of population growth, 
ongoing agricultural demands, and increasingly evident environmental 
needs. With increased emphasis on domestic energy development, 
additional pressure is placed on limited water supplies, as significant 
amounts of water may be required for all types of energy development. 
At the same time, climate change, extended droughts, and depleted 
aquifers are impacting water supplies and availability.
    In response to these demands, by the end of 2013, Reclamation will 
enable capability to increase available water supply for agricultural, 
municipal, industrial, and environmental uses in the Western United 
States by 730,000 acre-feet cumulatively since 2009 through its 
conservation-related programs, such as water reuse and recycling (title 
XVI), and WaterSMART grants.
    Moreover, Reclamation's Water Conservation program addresses a 
range of other water supply needs in the West. It plays a significant 
role in restoring and protecting freshwater ecosystems consistent with 
applicable State and Federal law, enhancing management of our water 
infrastructure while mitigating for any harmful environmental effects, 
and understanding and responding to the changing nature of the West's 
limited water resources.
    Finally, the fiscal year 2013 budget demonstrates Reclamation's 
commitment to meeting the water and power needs of the West in a 
fiscally responsible manner. This budget continues Reclamation's 
emphasis on managing those valuable public resources. Reclamation is 
committed to working with its customers, States, tribes, and other 
stakeholders to find ways to balance and provide for the mix of water 
resource needs in 2013 and beyond.
                               conclusion
    This completes my statement. I would be happy to answer any 
questions that you may have at this time.

    Senator Feinstein. Thank you very much. And, we'll now 
proceed with questions and, Mr. Connor, let me thank you for 
your constant cooperation and helpfulness. It's really been 
very special.
    I just want you to know how much it's appreciated.
    Mr. Connor. Thank you.

                   NATOMAS LEVEE IMPROVEMENT PROGRAM

    Senator Feinstein. Let me speak for a moment about a deep 
concern in California.
    I've had occasion to speak with people about it. It's the 
Natomas Project in Sacramento. My understanding is it's 42 
miles of levees, 18 have been repaired at a cost of about $320 
million by Sacramento Area Flood Control Agency (SAFCA). I've 
had a chance to talk with Secretary Darcy about it.
    It's priority number one for the City of Sacramento. I have 
been told that a failure could cause a flood which would flood 
as much as 20 percent of the city. Is that correct?
    Ms. Darcy. Madam Secretary, I believe that's accurate.
    Senator Feinstein. I know it's not included in what you're 
proposing. Can you tell us why it hasn't been included?
    Ms. Darcy. On this specific project, I may have to defer to 
the General, because that portion of the project is one that 
I'm not quite familiar with.
    Senator Feinstein. General Temple, could you speak directly 
into the microphone?
    General Temple. Sorry. I'll have to get back to you on the 
specifics pertaining to that, but I do know that we are 
diligently working to reduce flood risk in the Central Valley 
of California, and Natomas is certainly a key part of that.
    Senator Feinstein. Right. Well, I think I know what 
happened. In the 2010 Chief's report, the costs were identified 
to be $1.1 billion in necessary levee improvements which I 
understand is a high ticket item.
    The question I have is, can the work be segmented? So the 
work that's most critical, where there are people behind the 
levee, can be protected. Madam Secretary?
    Ms. Darcy. I believe that the portion that you're 
discussing needs authorization; that portion that you're 
discussing is currently not an authorized part of the project.
    Senator Feinstein. Well, that's interesting. Do you have 
any information as to why it's not authorized?
    Ms. Darcy. That Chief report is still pending; there has 
been no authorization for any projects since 2007.
    Senator Feinstein. So when would authorization be likely?
    Ms. Darcy. That Chief's report is pending; it's up to the 
Congress to authorize the project.
    Senator Feinstein. Right. Well, I can tell you this, I 
think this is the number one levee need in California, and 
Sacramento is the capital city. It's been confirmed that 20 
percent of the city would be flooded. It's a very serious 
problem and I know we've discussed it.
    Anything that can be done, would be very much appreciated, 
so I just want to publicly bring it to your attention.

                     HARBOR MAINTENANCE TRUST FUND

    I marked a question that I wanted to be sure to ask, and 
here it is. The subject is harbor maintenance taxes to the 
States which generated them.
    It's my understanding that California ports provide at 
least 30 percent of the funding that goes into the Harbor 
Maintenance Trust Fund. If we assume that the trust fund 
generates $1.5 billion annually, then California annually 
contributes $450 million into the fund, so how much dredging of 
eligible harbors and waterways in California were reimbursed by 
the trust fund in 2011?
    Ms. Darcy. I believe the figure, Senator, is $102 million.
    Senator Feinstein. $102 million. So, about 5 percent of the 
annual revenues?
    Ms. Darcy. Give or take, close to 5 percent.
    Senator Feinstein. So, this is one of the problems that----
    Senator Graham. California is getting ripped off.
    Senator Feinstein. So, it's a bipartisan issue now. You 
know, it's only so long that you can tolerate paying this money 
and not getting back adequate services.
    The question I have is, what would be the impact of 
changing the law in a manner that sets a percentage of the 
revenues generated in a given State to be returned to that 
State?
    Ms. Darcy. If the law were changed to do that, then the way 
we would budget for the revenues coming from the fund would be 
based on that percentage.
    Currently, we look at the appropriation that we have from 
the Harbor Maintenance Trust Fund. This year's President's 
budget includes $848 million. And what we do with that money 
now is look at where the needs are around the country.
    All ports pay into this Fund, so we look at the needs 
nationally. We don't do it on an----
    Senator Feinstein. I don't disagree with that. I think 
that's not a bad way to do it. I think it's a responsible way 
to do it.
    On the other hand, we have 50 percent of the container 
traffic coming into America, coming into LA-Long Beach, and 
harbor maintenance is a huge issue. Our harbors are decrepit.
    So this is my view, and I don't know that others on this 
subcommittee agree, but if you have a lot of traffic, harbor 
maintenance also relates to things like the ability to move 
those containers out.
    Intermodal transportation, roadways that are suitable, are 
also important because the delivery of a container doesn't end 
at a port. This is something I am really concerned about, and 
would like to ask your help on in the future as to how we might 
be able to work this.
    I think all of it should go to areas of need. I could make 
the argument to take all of it for California. Mr. Graham could 
make a pretty good argument to take it to a certain harbor 
called Charleston.
    Senator Graham. Not all of it.
    Senator Feinstein. Not all of it, but he'd take a part of 
it.
    So, I think we've got to work something out that is fair. 
I'd really like to have your cooperation in trying to do so in 
the future.
    Ms. Darcy. We'd be happy to work with you.
    Senator Feinstein. I appreciate that. Thank you very much.
    Senator Alexander.
    Senator Alexander. Thank you, Madam Chairman.
    Well, I think the chairman has roused up an ``amen'' corner 
over in the southern section of the subcommittee, and I'd just 
like to say as we begin this discussion, I have a pretty good 
idea what Senator Graham's going to be talking about when the 
time comes.
    And I agree with him. We've been having some discussions 
about--and Secretary Darcy, I think this is mainly aimed for 
discussion with you--and I'll leave it to him to explore this, 
I hope that's what he intends to do, is that we need to take a 
big look at these two trust funds, and think bigger than the 
funds.
    Think about what the needs of our country are, and outline 
a policy and a program and an idea, and think in a big way 
about it, and I very much agree with that. And part of that may 
be recognizing that in some cases, we need a different sort of 
formula for harbors.
    And it may mean we need different ways of collecting money. 
But my experience in Government is you don't start out by 
talking about the money, you start out by talking about the 
policy and the need and what our goals are. And then, it makes 
it a lot easier to figure out how we pay for it.
    Now, in that spirit, let me narrow down something that I 
think emphasizes the problems with one of the funds, the Inland 
Waterway Trust Fund. The problem with the Harbor Trust Fund, of 
course, it has a lot of money in it, we just can't spend it.

                       INLAND WATERWAY TRUST FUND

    The Inland Waterway Trust Fund doesn't have much money in 
it, but it has a lot of needs. One of the reasons we don't have 
money for the dams and locks that it should be funding is this 
Olmsted Lock on the Ohio River that between last year and this 
year, according to the budget, increased its costs by $1 
billion from $2 billion to $3 billion.
    And this one lock is soaking up the money that ought to go 
for other priority projects. Have you given any consideration 
to changing the cost sharing on the Olmsted Lock from the 
current 50-50 to something such as 90 percent from the Treasury 
and 10 percent from the Inland Waterway Trust Fund so that we 
could consider other priority projects?
    Ms. Darcy. No, Senator. Under current law, we have to cost 
share 50-50 from the Inland Waterway Trust Fund.
    Senator Alexander. Well, why can't we change that to 90-10?
    Ms. Darcy. That would take an Act of Congress.
    Senator Alexander. Well, we're in a position perhaps to do 
that if you were to recommend it. You think it'd be a good 
idea?
    Ms. Darcy. I think what we'd have to look at is all the 
competing priorities on the system before we made any 
recommendation.
    Senator Alexander. Well, do you think it's a good idea for 
one big project to soak up virtually all of the money available 
for the Inland Waterway Trust Fund dams and locks?
    Ms. Darcy. Well, unfortunately, given the constraints of 
the incoming revenue from the tax, that's all that we can 
afford at this time. The priorities have been discussed with 
the industry.
    Unfortunately, it is a very expensive project.

                            CHICKAMAUGA LOCK

    Senator Alexander. Has this huge increase, 50-percent 
increase, just this year in the cost of this lock, changed the 
projected timeline to restart construction on Chickamauga Lock?
    Ms. Darcy. I don't believe so, but in general I----
    Senator Alexander. That would be encouraging news.
    General Temple. Do you mean whether it has changed the 
timeline for construction on Chickamauga Lock?
    Senator Alexander. To restart construction, right. Is the 
fact that they're going to spend an extra $1 billion on 
Olmsted, has that affected the timeline for restarting 
construction on Chickamauga Lock?
    General Temple. It will affect it in 2013, Sir, based on 
current projections of revenue and priorities.
    Senator Alexander. General, have you made projections about 
how much longer the current Chickamauga Lock can be operated 
and maintained?
    General Temple. Our asset management database system is 
going to be used to perform that analysis. We know that we can 
sustain operations on the Lock at least through 2013.
    How much longer we'll be able to do it given its current 
condition, which you're very aware of----
    Senator Alexander. You mean it might be closed after 2013?
    General Temple. There is that possibility, Sir, depending 
upon----
    Senator Alexander. You might close the Chickamauga Lock 
after 2013?
    General Temple. There is that possibility, Sir, depending 
on the status of the Lock itself and its integrity.
    Senator Alexander. Well, that is dramatic news for the 
people of the Southeastern United States which I've not heard 
before.
    What would it take to keep it open?
    General Temple. Sir, if we were able to continue to apply 
O&M dollars to keep it going because of the expensive concrete 
situation that I know you're familiar with there, we would be 
able to sustain it for some time longer.
    Senator Alexander. But you've recommended reduced funding 
for aggressive maintenance on the Chickamauga Lock?
    General Temple. That is correct, Sir, because of competing 
priorities and funds available, we had to make some difficult--
--
    Senator Alexander. So you're going to spend, you're going 
to increase by 50 percent the cost of this one project, Olmsted 
Lock, by $1 billion and run the risk that after 2013, which is 
only a year plus a few months away, that the Chickamauga Lock 
might be closed which would cost thousands of jobs in the 
Tennessee-Georgia area, put 150,000 heavy trucks on I-75 and 
threaten the operations at the Tennessee Valley Authority, the 
Oak Ridge Laboratory, and many industries in the area.
    General Temple. Sir, that is the recommendation based on 
working with all of the stakeholders to determine the relative 
needs throughout the entire system.
    Senator Alexander. Thank you, Madam Chairman.
    Ms. Darcy. Senator, could I just add something? The 2013 
budget includes Operation and Maintenance dollars for the 
Chickamauga Lock. We just haven't added the enhanced 
maintenance.
    So the maintenance that we have ongoing, hopefully, will 
continue to keep it operable. We just haven't included funding 
for the enhanced maintenance. We will continue to monitor the 
effects of that.
    Senator Alexander. Well, I would hope so. Even the 
possibility that it might close at the end of 2013 is a 
startling development to me if that's what you're saying. Is 
that what you're saying?
    Ms. Darcy. We don't anticipate it closing, but it's a 
possibility. Right now, we are providing funding for ongoing 
maintenance, just not for the enhanced maintenance.
    Senator Alexander. Thank you, Madam Chairman.
    Senator Feinstein. Thank you very much, Senator Alexander.
    Senator Collins.
    Senator Collins. Thank you, Madam Chairman.

                        VERNAL POOL REGULATIONS

    Secretary Darcy, the Corps has permitting responsibilities 
under section 404 of the Clean Water Act for development 
activities that may occur in wetlands.
    And several of my constituents, including municipal 
officials, hospital on the coast that had a project underway, 
have raised concerns about the application of regulations in 
the New England district, particularly, as they differ 
dramatically from what is required under State law and 
maintenance, known for very strong environmental laws.
    And they seem to be far more demanding than those supplied 
by the Corps in other parts of the country. For instance, for 
significant vernal pools, the State of Maine regulates a 200-
foot terrestrial buffer area that includes the vernal pool.
    The Corps published rule requires a 500-foot radial 
circumference. But more recently, guidance has been issued, not 
through the formal rulemaking process, but just guidance, that 
increases the radial distance to 750 feet for any vernal pool 
that may be perceived as having critical habitat.
    Now, just so I want to understand the difference, if you 
apply a 700-foot buffer to property, it results in a regulatory 
footprint of more than 40 acres for just a 50-foot diameter 
vernal pool.
    So going from 500 feet to 750 feet has enormous 
consequences and has brought to a halt several important 
development projects that municipalities have been pushing in 
Maine.
    I'm interested in first getting a better understanding of 
how your New England district determined to increase the 
regulated area to a 750-foot radius without going through the 
normal Administrative Procedure Act (APA) procedure and instead 
did it through informal guidance.
    Ms. Darcy. I can't answer that because I don't know, but I 
will commit to you that I will ask the New England district as 
soon as this hearing is over, and I will find out why.
    Senator Collins. Let me ask you a second question. In the 
New England district, it also appears that the Corps has 
abandoned the nationwide permit program and has begun to defer 
to the commenting agencies on protection of vernal pool habitat 
even in the less significant, and frankly, ubiquitous forested 
wetlands that are present throughout my State of Maine.
    Now, by contrast, again, the State distinguishes between 
significant vernal pools as well as natural and manmade vernal 
pools in its regulation. But the Corps does not make that 
distinction, and instead is regulating every vernal pool in the 
same way.
    And in my State there are literally thousands of vernal 
pools and forested wetlands that are different from other 
States and the application of this regulation in Maine has the 
potential to affect literally tens of thousands of acres of 
land. And that's why we're getting this slew of complaints.
    Now, by contrast, in the South Atlantic district, these 
nationwide permits are still available for projects with 
multiple acres, and in some cases, projects are allowed without 
permits.
    And, again, I'm trying to understand why is there such a 
great difference in the way the New England district regulates 
wetlands versus the South Atlantic district?
    Ms. Darcy. I'm going to say that it's probably because of 
the different topography and geography that we're dealing with, 
but I am not sure that is a good enough answer. I think I owe 
you a better answer than that as to why the New England 
district is considering these differently from other districts, 
considering the nationwide application of permits.
    Senator Collins. Well, I would ask that you respond to 
those questions in writing, and my time has expired. I have a 
couple more that I will submit for the record on this issue as 
well.
    I know it's a very technical issue, but what I'm hearing 
from everyone from officials in Brewer, Maine to a manufacturer 
in Auburn, to a hospital in Rockport, Maine, there's something 
going on.
    And, as I said, Maine has strict environmental laws. We 
prize our environment. But the implications of this new 
approach by the New England district is bringing to a halt a 
lot of very important economic development projects.
    I do want to thank the President for including $13 million 
in the budget request for the dredging of the Portland Harbor. 
That is a very important project to economic development in my 
State.
    And I am still concerned about those smaller ports and will 
be proposing a question for the record. Thank you.
    Senator Feinstein. Thank you, very much.
    Senator Lautenberg, I usually do early bird, and you've got 
a bird earlier than----
    Senator Lautenberg. I consider Senator Graham a friend, and 
I wouldn't want to deprive him of the opportunity to proceed, 
if necessary.
    Senator Graham. I will certainly defer, if you need to go 
Senator Lautenberg.
    Senator Lautenberg. All right. Now, it's my hand. Thank you 
very much. Thank you, members of the Corps for the wonderful 
work you do and for the dependence that we've built over a long 
period of time for you to fix things sometimes where nature's 
gone wrong, or where man's gone wrong.

                          PASSAIC RIVER BASIN

    But we need your work to continue and we need it to be 
appropriately budgeted. Last year, President Obama toured the 
Passaic River Basin in New Jersey following Hurricane Irene.
    And the budget includes $1 million for a study to find a 
long-term solution to chronic flooding in this area. However, 
I'm told it will take at least 3 years for construction to 
begin on a solution.
    Now, how can the Corps, General, expedite this project to 
ensure that families in the Basin have flood protection as soon 
as possible?
    General Temple. Well, thank you, Sir. We are re-looking our 
whole planning program in order to address this issue of 
timeliness, and this includes not only changing the process in 
order to get after timeliness, but also we are using six pilot 
projects to look at how we can compress studies in a way to 
provide these studies more quickly.
    We're taking a look at the entire inventory of all of our 
feasibility studies to determine how best to apply our limited 
capabilities against the highest priority studies, and we're 
improving our training and certification of all of our 
planners.
    That said, we're striving towards a goal of a three-by-
three-by-three strategy which involves a $3 million effort at 
less than 3 years in order to provide these types of services, 
Sir.
    So, we're working to compress the schedule, and we'll 
certainly do that in this case.

                     ONGOING FLOOD CONTROL STUDIES

    Senator Lautenberg. Ms. Darcy, the budget requests funding 
for six new Army Corps studies is included. However, the budget 
doesn't include funding for several critical ongoing New Jersey 
studies including the Rahway River Basin, the South River 
Raritan River Basin, the Stone Brook Mill Stone River.
    Now, why does the budget request funding for these new 
projects while leaving out these three ongoing, flood control 
programs; do you know?
    Ms. Darcy. Well, Senator, we did provide some money in the 
work plan for these three studies. However, in evaluating the 
ongoing studies for funding in 2013, these did not compete as 
effectively as some other studies.
    Senator Lautenberg. Well, we'd like to make sure that we 
get these things in order because we know one thing, the three 
projects that I talk about are critical to the safety and 
wellbeing of people in those areas.

                  NEW YORK-NEW JERSEY HARBOR DEEPENING

    I'm pleased that the budget includes, Secretary Darcy, $68 
million to complete the deepening of the New York-New Jersey 
Harbor, a critical economic engine that supports more than 
230,000 regional jobs.
    Now, following completion of the construction phase, what 
are the Corps plans to maintain the Harbor so that large cargo 
ships have easy and sustained access to the port and that we 
don't lose these ships to other places?
    Ms. Darcy. Once the deepening is completed, we will 
continue to operate and maintain that harbor through the Harbor 
Maintenance Trust Fund, and it will compete within that trust 
fund for available dollars.
    Senator Lautenberg. The Corps is filled with experienced 
professionals that do great work. However, the most frequent 
complaint that I hear from local communities about the Corps is 
that it takes too long. I think, generally, you made reference 
to that in your comments.
    Is the Corps considering ways to decrease the time to build 
projects? Perhaps, General, that question should go to you?
    General Temple. Thank you, Sir.
    When I spoke earlier about the transformation of planning, 
that's a subset of Civil Works transformation, which includes 
four key elements.
    First, planning, which I described a little earlier. Also, 
a focus on performance based budgeting processes which are 
reflected, for instance, in the 2013 budget.
    Performing a complete inventory of our assets and 
performing better asset management across those facilities that 
we're responsible for.
    And last, but not least, we are looking at how we deliver 
these through changes in methods of delivery that allow us to 
leverage the expertise across each district, across each 
region, and indeed, across the entire enterprise, to ensure 
that we deliver our products and services in a more timely 
fashion.
    Senator Lautenberg. Now, we appreciate the fact that 
there's almost always an overload in the Corps because there 
are more projects than there are hands or dollars. But we 
encourage you to keep up your good work.
    Thank you very much.
    General Temple. Thank you, Sir.
    Senator Feinstein. Thank you very much, Senator Lautenberg.
    Senator Graham.

    IMPACT OF PANAMA CANAL EXPANSION ON UNITED STATES SHIPPING PORTS

    Senator Graham. Thank you, Madam Chairman.
    I want to recognize the Executive order issued by President 
Obama. It says, ``Improving Performance of Federal Permitting 
and Review of Infrastructure Projects'' dated March 22.
    I am very impressed by this document. It really does 
through the Executive branch lay out a way to speed up these 
projects and to come up with a better vision about how to 
execute and maintain major infrastructure projects.
    The one thing I would suggest is to look at putting port 
people on the steering committee, the people that are on the 
front lines. But I just wanted to recognize the 
Administration's efforts in that regard.
    Now, you also report, Secretary Darcy, in June?
    Ms. Darcy. Yes, Sir.
    Senator Graham. And as you can tell from a California 
perspective, the current system's not exactly where you would 
like it to be.
    And from Senator Lautenberg's question, you have a harbor 
that's been studied, designed, constructed, and he's worried 
about maintenance of large ships. Now, I'm worried about the 
Chickamauga Lock. I didn't know about it, but I'm worried about 
it now. So, good, I am sufficiently worried.
    What we're doing, among ourselves up here, is trying to 
create a vision, in collaboration with the Executive branch, 
that recognizes things are about to change dramatically.
    The ports on the west coast seem to have a real need in 
terms of interior infrastructure development, and the 
definition of harbor maintenance doesn't seem to get us to that 
need.
    I would argue that the best way for us to have a vision is 
to look at these trust funds anew. And try to find ways to get 
more money in the system, maybe more matching money.
    But what we're going to be working on among ourselves is 
when the Panama Canal expands in 2015, it has a direct impact 
on the east coast, and will change shipping as we know it, 
including the interior along the Mississippi River and other 
places; do you agree with that?
    Ms. Darcy. Yes, Sir.
    Senator Graham. So what we're looking at doing is seeing 
how can we reconstruct or redesign these trust funds to get the 
money in place to build toward a vision?
    So rather than worrying about funding up front, we're 
trying to create a vision, a vision that would allow west coast 
ports who have a different problem than the east coast to be 
able to access funds that they're helping generate to make sure 
that America on the west coast has the best facilities possible 
in an international competition for export jobs.
    And, if we don't get this right soon on the east coast, 
ports are going to pop up along the Caribbean, Cuba, and other 
places, and if we don't watch it, this change in shipping is 
going to be lost to the United States.
    Do you agree that's a possibility?
    Ms. Darcy. It's a possibility, yes.
    Senator Graham. So what we're looking at doing is that some 
ports need to be deepened along the east coast. Maybe we can 
look at the Harbor Trust Fund anew and say that, you know, 
dredging is a new activity allowed in the Harbor Maintenance 
Fund.
    And when it comes to Harbor Maintenance definitions on the 
west coast, allow money for interior development. Now, the 
inland piece is going to be affected by what happens on the 
east coast.
    So what I would suggest is that we try to create a vision 
of what happens to our interior ports, based on Panama Canal 
expansion, look at what the west coast needs, in terms of their 
harbors, and take these trust funds and redesign them to meet 
the reality of the 21st century.
    Do you think that's a good project for us to engage in?
    Ms. Darcy. I do. I think we need to look at both trust 
funds as to what needs need to be met that aren't being met by 
them right now as well as increasing the revenues to them.
    Senator Graham. And the trust funds, as I understand it, 
generate about $1.2 billion a year, right?
    Ms. Darcy. The Harbor Maintenance Trust Fund generates 
about $1.4 to $1.5 billion a year.
    Senator Graham. And how much do we spend each year?
    Ms. Darcy. The President asked for $848 million this year.
    Senator Graham. So I would just suggest that people are 
paying or investing in these ports through fees that we ought 
to be using the money to make sure that we meet the President's 
goals of doubling exports.
    Do you agree that one way to double exports in America is 
to have modern ports and shipping systems?
    Ms. Darcy. Yes, and we're trying to reach that goal by 
keeping what we have in working order.
    Senator Graham. Okay. Now, that's just not enough. We need 
to keep what we have in working order, but we also need to have 
the best in the world. So that's our goal, right?
    Senator Feinstein. Would you yield for just a moment?
    Senator Graham. Yes, I will.
    Senator Feinstein. I once took a little tour of ports, the 
Hong Kong port, the Singapore port, other ports. Our ports are 
so far behind in infrastructure that it's scary.
    Senator Graham. It's scary, isn't it.
    Senator Feinstein. We are nowhere close to modern.
    Senator Graham. And we're going to fix that together, 
aren't we?
    Senator Feinstein. Yes, I hope so. For existing ports as 
well as potential future port improvements.
    Senator Graham. Okay. Yes, Ma'am.
    So, my time is up. But here's what I would like in the June 
Report. I'd like you to detail, as much as you can, the 
reasonably known consequences of Panama Canal expansion, 
knowing that you're going to have limited funds no matter what 
you do, and give us some sense of prioritization.
    Look at the idea of changing the Harbor Maintenance Fund 
and allow dredging to come out of that pot of money. Change the 
definition of the Harbor Maintenance Fund when it comes to west 
coast port Interior infrastructure development.
    Look at the Interior Trust Fund and see if it can be 
married up with the Harbor Maintenance Fund to create a vision 
that goes from the east coast to the interior to the west 
coast.
    And give us some idea of what happens if the Panama Canal 
expands, and what affect the larger ships will have on the east 
coast as well as the interior of the country. What kind of 
ripple effect will it have?
    And not just try to maintain what we got, but think outside 
the box and suggest to us ways to leverage the current system, 
ask for matching funds that are not asked for today, maybe more 
money coming from the private sector.
    This effort should not be just to maintain what we have, 
but to get ahead of the world before it's too late. Because if 
we don't act in a reasoned, rational way, this shipping that's 
coming through the Panama Canal is going to be lost.
    And if we don't upgrade our west coast ports, we're going 
to lose jobs at a time we need jobs.
    Do you think the June Report could be that expansive and 
that forward leaning?
    Ms. Darcy. The report, the study as you know, is well 
underway, and I'm not sure that we are looking at the uses of 
the trust funds in that report.
    Senator Graham. Could you do that?
    Ms. Darcy. We can try; because the Corps is on track to 
have it completed by----
    Senator Graham. Well, just think big.
    Ms. Darcy. Think big.
    Senator Feinstein. Thank you very much, Senator.
    Senator Landrieu.
    Senator Landrieu. Thank you, Madam Chair.
    And I agree with the Senator that we have to think big, but 
we're going to need a bigger budget to do that. And there's 
absolutely no way around it.
    This budget that we have in front of us, despite the very 
good work that this chairman has done, and it is in no a 
reflection on the work that she has done, or that we've done 
over the course of the last years, simply does not have enough 
money to maintain or invest or build the structures that we 
have to to build an economy that lasts.
    And that's just the simple truth. There's no way around it. 
And until we can figure out a way to put more private and 
public money on the table, we're not going to get there.
    I want to thank the Chairwoman for her extraordinary help 
with the very limited resources that are in this budget, in the 
President's request, and reflected in our 302(b) allocation.
    To thank her very much for the $1.7 billion that you were 
able to find and direct, Madam Chair, last year for emergency 
flooding. It has been a tremendous help to not just Louisiana 
and to our communities that were flooded, but all throughout 
the Mississippi River, and I understand, the Missouri River as 
well, and around the country.
    So thank you very, very much for being supportive. I want 
to thank the Corps, even with this limited and wholly 
insufficient budget, that you were able to start two new 
projects in the country. And one of them is a project that we 
should have started 30 years ago. But at least it's getting 
started now.

                    LOUISIANA COASTAL AREA PROJECTS

    And that is the Louisiana coastal area projects. There were 
only two new starts. The sad story is that if we had started 
this project, and this isn't only the Corps' fault, there's 
enough blame to go around.
    We could have saved the size of the State of Rhode Island, 
which we have already lost, and we're not sure even with this 
new project, and the billions of dollars that we're finding 
through a variety of sources, to put towards saving Louisiana's 
coast, which is America's wetlands.
    We're not sure how much of that marsh we can ever recover. 
But we think we can stop the degradation. We think we can build 
safe communities for the millions of people that live near this 
shore, from Texas, Louisiana, Mississippi, and Alabama, that 
simply cannot be moved north.
    So we thank you for recognizing the significant importance 
of that. But I do want to talk about these trust funds because 
that is the first step. And Senator Levin has been particularly 
vocal on this, and I want to do a shout out for him.
    Because he's worked extremely hard. And I was wondering 
why, and then I looked at the map of all of the ports, and saw 
the cluster of ports in Michigan. And it dawned on me that that 
is one reason.
    But he's right. We have a cluster of ports in the southern 
part of the country, on America's energy coast. And the fact 
that we have not been allocating, Madam Chair, all of the money 
to these trust funds that the private sector is paying into 
them, I think this should be the major issue for our 
subcommittee.
    I mean the highway committees have done a pretty good job 
of building support to capture the gasoline dollars for surface 
transportation. We need to be very aggressive in gathering the 
maritime dollars that are being paid for our ports and for our 
dredging.
    I understand from looking at this issue that is a huge 
issue now for us in Louisiana. And I want to ask you if this is 
true? That of all of the waterways that taxpayers have put in 
money to build, that the average width and depth is only one-
third, we're only maintaining about one-third of that capacity; 
is that correct?
    Or, do you think it's more close to one-half?
    Ms. Darcy. I would like to say it's more, closer to one-
half, but I think it's probably somewhere in between.
    Senator Landrieu. So, Madam Chair, just think about this 
big picture for a minute. Of all the waterways in the country 
that bring in resources from the South, the East, and the West, 
our channels, this budget, is barely maintaining one-third of 
their capacity, either at width or depth.
    What that means is our economy is weaker every day that a 
ship has to be light-loaded or stand offshore because the 
channel isn't deep enough to come in. Senator, whether this is 
natural gas coming in or going out, or whether this is 
fabrication materials coming in and out. They're standing 
offshore because the channels are not wide enough or deep 
enough.
    This is really a shame. And people focus on infrastructure, 
thinking about roads and bridges and mass transit. I'm going to 
be on a tear this year to focus on our water transport because 
it's crucial.

               MODIFIED CHARLESTON METHOD FOR MITIGATION

    And, finally, I know my time is out, I want to follow up on 
one other point. And this is of great concern to Louisiana. Our 
division down in Louisiana, the New Orleans Division of the 
Corps, has recently adopted what they call the Modified 
Charleston Method for Mitigation.
    Until I can get a better explanation, I'm going to try to 
insert money in this bill to prevent that from going in place 
until I can understand how the cost is going to affect our 
efforts to save our coast.
    Because just what Susan Collins--Senator Collins was 
speaking about the complaints in Maine, Madam Chairman, if we 
don't really understand this mitigation, sort of one for one, 
like if you take an acre of wetlands, you have to replace it, 
I'm all for that.
    I mean I don't think we can have a net loss of wetlands. 
But the Corps is now going to a method that's costing a three-
to-one. So, instead of a levee, let's say that I have to build 
a lot of that you have to help pay for, this is why it's 
important to you, and to me, instead of it costing $100, that 
same foot of levee is going to cost $400.
    It's going to bankrupt us. We have a problem as it is under 
the one-for-one. If we go to a three-to-one method, the 
projects are going to become that much more expensive. So I 
know that there's an environmental reason for this, and I want 
to be sensitive to it.
    But we also have to be sensitive to the taxpayers that are 
picking up this tab, and be very clear before we implement this 
what the economic impacts are going to be.
    So would you make just a brief 30 seconds, and then I'll 
thank the Chair for allowing me to go a little over, on the 
increased cost for flood control if we use that Charleston 
method?
    Ms. Darcy. Thank you, Senator Landrieu.
    What's being referred to as the Modified Charleston Method 
is a different way of evaluating permit applications. As you 
say, there's an increase in the acreage that would be used for 
the mitigation on flood control and other projects.
    That method is just starting to be used in some of our 
districts, and what I think I need to do is take a look at what 
the impact is on all of our districts. Because not all 
districts are using it.
    One of the reasons for using it was to have some 
consistency throughout a State. And I think consistency is 
something that we need to have, but your concern about the cost 
impacts is one that I think we need to look at before we move 
forward.
    Senator Landrieu. So before we expand that, I would really 
recommend that we get an analysis of the economic impact for 
California, for Louisiana, for, you know, South Carolina, North 
Carolina, so at least we know what we're laying on people
    Because the final question, Madam Chair, we have an 
obligation to put up some money, but remember, the local 
governments have to put up some funding too. And this is 
substantially increasing their costs.
    And I'm getting nothing but complaint after complaint from 
our levee boards. My parish officials said, Senator, this will 
absolutely bankrupt us, and that's the last thing we need to 
do.
    Senator Feinstein. You have done yeoman's service to your 
State.
    Senator Landrieu. Thank you.
    Senator Feinstein. I don't know of anyone that's worked 
harder than anybody for their State than you have.
    Here's the problem. You know, we're the chorus talking to 
each other. The fact of the matter is that the Corps' budget is 
down 5.4 percent. The Bureau's budget is down 1.3 percent.
    Here's the overall issue in the energy and water portfolio, 
the security part of it, which is tens of billions of dollars, 
has projects that start out costing $600 million end up costing 
$6 billion. That's an actual case.
    It all has to do with the nuclear security and the warheads 
of this Nation. They are absorbing a bigger and bigger part. 
And you can't change that. It's a mandatory spending item.
    Who suffers? The Corps, the Bureau. They are pushed and 
compressed. Somehow people have to wake up to this, and talk to 
the Administration to help us because it simply isn't the right 
thing.
    At home, our infrastructure is poorer and poorer and 
poorer. Our ports are outdated. Our levees need fixing. The 
storms are bigger. The hurricanes are stronger. The tornadoes 
are much more volatile.
    Senator Landrieu. Yes.
    Senator Feinstein. The damage is much, much greater. There 
is no ability to respond to it proportionately. That's just a 
fact.
    Senator Landrieu. Yes.
    Senator Feinstein. That's why I love both these budgets 
because I said earlier, it's where the pedal hits the metal. 
It's really where we live. It's what we see.
    If 20 percent of Sacramento gets flooded, and I know that's 
going to happen, and the Corps confirms it to me, and the levee 
collapses, all I can say is it would have been an earmark. I 
would put it in, but I can't put it in.
    Senator Landrieu. Yes.
    Senator Feinstein. So the bottom line is, I have to fish 
around for a way to go around that. It's wrong. It's just plain 
wrong. I've been here for 20 years. I've never seen anything 
like it. I mean, why be on the Appropriations Committee if you 
can't do anything to be of help.
    Senator Landrieu. Right.
    Senator Feinstein. So I am overwhelmed with frustration. I 
asked the staff to give me a paper of the eight big nuclear 
projects and whether they're on budget and whether the costs 
have been borne out. Nothing done in the last 10 years there.
    Have the costs that it was initially scheduled to be, been 
accurate? So we're going to study root causes for this because 
I think Senator Alexander agrees, and you see it here now.
    I am really concerned about Sacramento. The major is 
concerned about Sacramento. The House delegation is concerned. 
In the old days, I'd just put an earmark in. I can't do that.
    Senator Landrieu. Well, Madam Chair, I'm with you 1,000 
percent. I serve on the Appropriations Committee, obviously, 
I'm on the subcommittee, but I can honestly say, of all the 
committees I serve on, there is no budget that is in more 
crisis than this one.
    We have strains on all the other budgets. They're strained. 
This is one wholly insufficient. And the reason I know I can 
say that is because if I asked you, Ms. Darcy, what your 
backlog is today, there are two new starts in the country that 
you have in your budget.
    They're probably 50 that are worthy to be started, and one 
of them might be your project, but they don't have the money to 
do it. So I'm happy to be one of the two. But the sad story is 
there should be 50 new starts.
    And, if I asked you what your backlog is, isn't it about 
$60 billion?
    Ms. Darcy. Yes, it is.
    Senator Landrieu. And so, how much money do you have this 
year if you could apply it to the backlog to get these 
projects? You have about $2 to $3 billion, right, in 
construction money, of the $60 billion?
    Ms. Darcy. Yes. It's $1.5 billion.
    Senator Landrieu. You see what I'm saying about this budget 
being in crisis? I don't think the defense budget is that far 
backlogged. I don't think the health budget is that far 
backlogged. It's strained.
    This budget is wholly insufficient, and it's not your 
fault, Madam Chair. It's our fault as the general 
Appropriations Committee, and we have to say to the President, 
and to our leadership, we cannot take it, the country cannot.
    And I'll just say this one more thing, if there was ever an 
example of what's going to happen, when the levees broke in New 
Orleans, in 52 places, and the cost has exceeded to fix it $140 
billion, is there any other case study that needs to be 
presented to thinking people that we cannot survive on this 
budget?
    That's the budget that produced the 52 breaks. Lord help us 
if something happens to Sacramento. You will feel waves across 
the whole country because of the products that come out of 
that.
    So I just have to say I'll do what you want, Madam Chair, 
but we have to do something extraordinary this year for this 
budget.
    Senator Feinstein. I think we have to find a way, and right 
now, I'll tell you, I don't know what that is. If anyone has a 
suggestion, I'm open to it.
    I think maybe we send a shock wave, and we just don't fund 
some of these other things.
    Senator Alexander. Well, Madam Chair. I think there's a way 
to deal with this. I think Senator Graham, you, and others have 
come up with a pretty good idea.
    We need to ask the Administration, starting with the 
thinking that's already done, to think with us, and provide a 
vision, an idea, for what we need to do about locks and dams 
and what we need to do about harbors.
    And then--and not think about the money, think about the 
vision. And then after we have the plan or the vision, then 
we'll see how much it costs, and then we'll see how we pay for 
it.
    Senator Landrieu. Could you put the gulf coast in that 
vision?
    Senator Alexander. Don't you have locks and dams and 
harbors, yes. Of course, I mean, for the whole country, for the 
whole country.
    And part of our problem is we're all tied up in the rules 
that we have around here which we can change. But if we start 
out just arguing about the rules that we have, that create the 
absurdity of having a fund with a lot of money in it that we 
can't spend, even though we have a lot of needs, and the other 
fund doesn't have any money in it.
    Even though we should be able to construct a way to do 
that, we just need to start with a vision, then with how to 
fund it, then how much it costs, and then with how to fund it. 
And I think we can do that in fairly short order, and I'd like 
to be a part of it.

                         PROJECT PRIORITIZATION

    Senator Feinstein. Well, for example, the Natomas Project 
isn't authorized. Why isn't it authorized?
    Are you planning to send your number one priority projects 
for a bill to get them authorized? Or have you been kiboshed?
    Ms. Darcy. As the Chiefs Reports are approved by the Chief 
of Engineers and cleared by the Administration, they are sent 
to the Congress. We have sent, since 2007, 14 Chiefs reports, 
and we probably have about another 12 to 13 that might possibly 
be completed this year. All of them would need to come to the 
Congress for an authorization.
    Senator Feinstein. So summarize that. What does that mean 
to you?
    Ms. Darcy. What it means is that by the end of this 
calendar year, we will probably have more than 20 Chiefs 
reports that will need to be authorized by the Congress. They 
range from harbor deepening projects to aquatic ecosystem 
restoration projects to flood control projects around the 
country.
    Senator Feinstein. Priority one? The highest priority?
    Ms. Darcy. Of those projects?
    Senator Feinstein. Yes.
    Ms. Darcy. I don't know that I could put one above the 
other.
    Senator Feinstein. Well, let me ask you, is there any way 
for the Administration to propose, award a bill, for the 
highest priority projects in the country based on protection of 
life and property?
    Ms. Darcy. That's a possibility. Any Water Resources 
Development Act (WRDA) proposal that would be developed would 
include other kinds of policy changes that we are looking at 
within the Administration.
    Within the President's budget, he talked about the White 
House Task Force on Navigation. In your conversations here 
today you discussed the need for revamping both the trust 
funds, that's something that I think this Task Force is going 
to have to tackle.
    In addition, we're working on a capitalization 
modernization program within the Administration, looking at 
ways on how we can recapitalize this aging infrastructure. 
We've all heard today we don't have enough money to do that, so 
we need to look at different ways.
    Senator Feinstein. Stop, stop. I don't mean to be rude, but 
here's the problem. The Administration has all of the clout. 
Therefore, it has the responsibility.
    Let me tell you a little story. When I was mayor, I used to 
have these Monday morning department head meetings. The 
Director of Public Works waited until after one of these 
meetings, and he said to me, ``Madam Mayor, I've got some news 
for you. I think if there were an earthquake, the rim around 
Candlestick Park would come down.'' I said, ``Oh, my God, Jeff. 
I don't have money.'' I said, ``How much would it be?'' He came 
back and said that to retrofit just the rim at $6 million.
    Then I thought, well, Candlestick is used so infrequently, 
you know, what is the real liability here? Then I thought, I 
now know, therefore, I have a responsibility. So we took and 
took from others. We had $2 million a year for 3 years.
    Who would have ever thought the San Francisco Giants would 
be in the World Series. At 5 o'clock on a weeknight in 
Candlestick Park when the big earthquake struck, and the rim 
held. And the estimate was you had a 60,000 seat stadium, 20 to 
30,000 people would have been impacted.
    As it is, one of the floors of the Bay Bridge fell down. 
So, you know, there's a responsibility. I think on a Federal 
level, we take this stuff too much for granted. I now know what 
will happen in Sacramento. You know. You have an obligation 
because this is administration.
    Anything we do is an earmark. Anything you do is not, and 
it gets done. So, I heard you on the public record say that you 
agree that 20 percent of the City of Sacramento would be 
flooded if that levee collapses.
    What are you going to do about it? You have a 
responsibility. I have a responsibility. The White House has a 
responsibility. So, you know, I think up there, there is this 
perception that, well, it's a low priority, you know, the W61 
warhead is more important, et cetera.
    Well, not if you get flooded. And, you know, the chances of 
it getting flooded are much greater than ever having to use the 
W61 warhead. So, we need to see some passion from the 
Administration to help because that's where it's at right now.
    Ms. Darcy. Yes, Ma'am.
    Senator Feinstein. We could put earmarks in the bill and a 
rule of order would lie against the bill, and I don't know 
whether we could get the votes or not to overcome it.
    But these are not private companies that somebody's doing 
an earmark for. These are major projects that protect the 
people and the property of the people. And I think that's 
really important, and it's the quality of life, and it's the 
ability to run an economy.
    So, Senator Landrieu is absolutely right. But right now, 
it's got to come from the Administration, and I've got to ask 
you all to be forceful and fight the fight, and we'll back you 
up.
    I'm going to write a letter to the President, and ask you 
all to sign it, and ask him to adjust his budget. Then, he can 
do it, and then it's not an earmark.
    It will be for the most serious projects that involve the 
safety of the people of this country. So, the projects for what 
hurricanes are doing, and what tornadoes are doing and the 
destruction that's caused. Those related to the climate getting 
warmer.
    In California, I've tracked the last 5 years of the water 
levels, and they're definitely changing from the historic 
average, and the snow pack is getting less and less. So it's 
just frustrating, to see the Corps and the Bureau take these 
cuts, and to see another part of our budget which is mandatory 
with billions of dollars of cost overruns.
    It's very frustrating.
    General Temple. Madam Chairman.
    Senator Feinstein. Yes, General, back us up.
    General Temple. Do you mind if I take us back to Chick Lock 
for just a minute?
    Senator Feinstein. Of course.
    General Temple. I did say earlier that there was a 
possibility that the Lock could close after 2013, but based on 
the monitoring that we've done, and assuming that we have 
normal operating and maintenance dollars to maintain the Lock, 
we don't anticipate that it would close within about the next 5 
years.
    It could, but we don't anticipate that it will. I just 
wanted to make sure it was clear.
    Senator Feinstein. Thank you. I know Senator Alexander is 
pleased.
    General Temple. Thank you. Thank you, Sir.
    Senator Feinstein. We have been joined by Senator Harkin. 
Senator, we're delighted to have you.
    Senator Harkin. Thank you very much.
    Senator Feinstein. You'd like to ask some questions?
    Senator Harkin. Madam Chair, thank you very much. I 
appreciate your indulgence, thank you very much. We all have 
other committees and many things that we're working on, so I 
appreciate this opportunity.
    And thank you for your wonderful leadership on these 
issues. I appreciate it very much.
    Senator Feinstein. Thank you.

                          FEASIBILITY STUDIES

    Senator Harkin. I just had a couple of questions I wanted 
to go over with General Temple and the Secretary.
    But, first, General Temple, I want to go over these 
feasibility studies and flexibility on feasibility studies. 
Well, I've been briefed and am supportive of your three-three-
three concept to reduce the maximum level of cost and time 
taken to complete feasibility studies as outlined in your 
February 8 memorandum.
    I think this is an important advance. But I also think it's 
important for the Corps to move forward with specific guidance 
beyond just the question of scoping, regarding things like the 
use of older data, simplifying requirements, and providing for 
accelerated review in order to maximize the ability of your 
districts to reach the goal of keeping these feasibility 
studies to 3 years and costing under $3 million.
    So it's the issue of providing guidance. My question is, 
what actions will the Corps be taking to provide additional 
guidance to the districts regarding these issues? What degree 
can there be simplification, and the waving of certain current 
requirements that are now the law?
    And what would be the timing of providing more detailed 
guidance to the districts on this issue? If you need me to 
elaborate, I will, elaborate anymore on that. Okay.
    General Temple. No, that's fine, Sir. Thank you.
    Because what you're talking about is planning 
transformation within the Corps. And as you may know, we have 
six pilot projects that are ongoing, in addition to the 
guidance that we've already put out.
    We will use information that we collect from those pilot 
projects to adjust the guidance, to address many of the issues 
that you have just described. The planning transformation is a 
work in progress, and as we continue to learn, we will continue 
to adjust it to achieve the three-by-three-by-three goal that 
you mentioned earlier, Sir.
    Senator Harkin. Okay, General, let me pursue this just a 
little bit further. So you got the six pilot projects. You're 
using the data from that to inform you on the guidance 
principles that you will put out.
    Is there any way you can give me some kind of a timeframe 
on this at all? Some of these people are looking for detailed 
guidance on what they need to do, and so they're waiting on 
that kind of guidance.
    General Temple. We will address guidance pertaining to 
planning as we look at each feasibility study in addition to 
input that we get from the pilot studies.
    So it is a continuous process, Sir. I mean, I can't give 
you a time because we are working on this all the time, but 
we'll continue to make progress on it as we move forward 
together, Sir.
    Senator Harkin. Well, I hope at least I detect some sense 
of urgency on your part.
    General Temple. Yes, Sir, absolutely.
    Senator Harkin. Thank you. That's very important.

                            DES MOINES RIVER

    I'm also concerned about projects, and I think you'll pick 
up on this, where a local government is paying and conducting a 
feasibility study, but again, working to meet these 
requirements of what they call a ``work-in-kind credit.'' I'm 
specifically talking about Des Moines, Iowa.
    I'm facing a very difficult problem with the Corps, the 
Corps having made a determination of higher flows on the Des 
Moines River, which is probably true, which calls into question 
the current flood control system meeting these Federal 
Emergency Management Agency (FEMA) requirements for a 100-year 
event.
    The city is moving as fast as possible to take corrective 
action. What specific actions are best though, however, does 
require considerable analysis. I think we all should be doing 
whatever we can to allow the process to move forward as quickly 
as possible to provide appropriate flood protection and to 
avoid significant economic problems if large areas of Des 
Moines are determined to be in a flood zone.
    So again, I'm asking that the Corps be, I guess what I'm 
asking is the Corps be at least as helpful to these local 
sponsors as if the Corps was doing it themselves.
    General Temple. Absolutely, Sir. We're aware of the Des 
Moines situation. We will support the local efforts in 
addressing this particular issue. It is very important. Yes, 
Sir.

                              OLMSTED LOCK

    Senator Harkin. I appreciate that. Third, I don't know if 
you covered this before I was here, if you have, did you cover 
anything about the Olmsted Lock at all on the Ohio? No.
    Well, people have suggested that it's logical for the Corps 
to do an in-depth study of the way Olmsted is being 
constructed, the amount of money that it's taking, which, of 
course, is keeping us from moving ahead on our whole plan for 
the Upper Mississippi Locks.
    Others have suggested it might be prudent to hold up 
additional work on Alton as a thorough study is conducted and 
move forward on other important navigation projects. I just 
wonder if you could tell me how you feel about that.
    Senator Alexander. Senator Harkin, if I may intercede.
    Senator Harkin. Yeah.
    Senator Alexander. We did discuss that a little bit and the 
Olmsted Lock on the Ohio River is increasing from $2 billion to 
$3 billion this year, a 50-percent increase, and it's soaking 
up all the money that could be used for other priority 
projects.
    And my question of Secretary Darcy was, have they 
considered changing the allocation or recommending a change in 
the allocation from 50 percent from the appropriations and 50 
percent from the trust fund to 90 percent from appropriations 
and 10 percent from the trust fund, which would free up trust 
fund money for other priorities.
    So thank you for letting me intercede there.
    Senator Harkin. No, I appreciate that. So where are we on 
this? Because I'm with you on this. I'm shocked at the amount 
of increase in the cost for that Lock.
    General Temple. Yes, Sir. We've asked the division and the 
district to take a look at multiple methods of delivery with 
respect to this project to see what we can do to deliver the 
project in a more speedy fashion at less cost if that's 
possible.
    And we expect that report back a little later this spring, 
Sir. And at that time we'll be able to make a better assessment 
of the way forward. Thank you.

                             MISSOURI RIVER

    Senator Harkin. Okay. Thank you.
    One last thing on the Missouri River which General McMahon 
knows well. I appreciate the work that's being done to restore 
the levees on the Missouri River, but I want to raise a couple 
of issues.
    We do need to move forward with the master manual for the 
Missouri River, but again, I want to be on record as saying 
that it has to be balanced for flood protection but for 
hydroelectric generation and also for navigation. And these 
things all have to be put in balance. It can't just be one or 
the other. These all have to be balanced.
    So I guess you are going to have a vulnerability assessment 
on the Missouri River in May, is that right Jo-Ellen, Secretary 
Darcy?
    Ms. Darcy. I think it is next month that it's due, yes, 
Sir.
    Senator Harkin. Okay. Good. And the reason I mentioned 
General McMahon is because there's these levees north of 
Council Bluffs that I understand they've been included in an 
examination of those needs, in a vulnerability assessment.
    There's a problem with them that they were all private 
levees. But the impact on public property and public lands from 
not fixing those lands could be sizeable, and so we'd looked at 
those in the past, and as I understand it, they're at least 
going to be included in the vulnerability assessment.
    So I appreciate that very much. Thank you, Secretary Darcy. 
Thank you very much, Madam Chair.
    Senator Feinstein. Thank you very much. I just got a note. 
If you have the opportunity, you should ask Reclamation a 
couple of questions.
    Ms. Castle. We need you to justify our salary for the 
afternoon.

                         CENTRAL VALLEY PROJECT

    Senator Feinstein. Well, let me do that just with a couple, 
and I don't mean to exclusively focus on California. But we've 
got a big water problem coming up, Mike, and in contrast to 
last year's near-record level precipitation, 2012 looks to be a 
fairly dry year.
    The Central Valley Project allocation certainly reflects 
that, and the South of Delta agricultural service contractors 
have 30 percent of their contract. The snow pack is still about 
54 percent of normal. So these are really concerning things.
    Can you provide us with a status report of actions the 
Bureau intends to take to increase deliveries beyond the 30-
percent allocation?
    Mr. Connor. Yes, Madam Chair. As a threshold matter, I just 
wanted to say I appreciate your kind words, but I've got to 
tell you, it's your leadership on these issues and your 
understanding that the current water supply situation 
infrastructure in California is just unsustainable. This is 
what necessitates us to act.
    And your urging that we do things better, that we don't 
accept the status quo, that we coordinate better, is much 
appreciated and very necessary, quite frankly.
    Senator Feinstein. Thank you.
    Mr. Connor. You're absolutely right about this year's water 
condition and I'll get to those actions. I just want to give 
you a statistic that just kind of blew me away on Monday when I 
received it.
    So last year at this exact time in the 2011 water year, we 
had combined releases from Shasta, Oroville, the State Water 
Project, and Folsom of 70,000 cubic feet per second (cfs). This 
year at this point in time, we're at 6,100 cfs, less than 10 
percent of what we were last year. So that gives you the 
context of the hydrology.
    And notwithstanding the fact that overall, there has been 
some precipitation that has moved into Northern California as 
of late, it's late in the season. It's certainly not near what 
it was last year, and it hasn't hit the San Joaquin Drainage 
Basin, which is at a record low, only comparable, I think, in 
the worst droughts of the late 1970s quite frankly.
    So it is a tough year. On the allocations, we're at 30 
percent South of Delta Water Service contractors as you 
mentioned. Based on some of the hydrology and the actions that 
we're taking. Hopefully, we will have another allocation 
announcement in the next 7 to 10 days.
    So look for that. I just wanted to put that on your radar 
screen. Based on specific actions recognized going into this 
year that we are in an extremely deficit situation, we've 
already started to take some actions.
    And we haven't done it alone. We've done it with our 
partners in the Central Valley Project. We made what we call 
``Section 215'' Water, this is surplus water, available much 
earlier than we had and under much different conditions than we 
had historically.
    So I think in January we saw an opportunity to make some of 
the surplus water available through the pumps in the Central 
Valley Project and we made available about 70,000 acre-feet 
early on.
    That doesn't show up in the allocation, but at least that's 
good wet water that our contractors can use in this year. We've 
got a number of other actions that we're looking at that is 
reflected in the water plan now that we've put out.
    We just put out our Central Valley Project water plan for 
2012, and that's a result of the discussions we had back in 
2010, where we started identifying these other actions. So 
certainly shifting this partnership that we have with the 
Metropolitan Water District and the State Water Project to try 
and use some of their water from San Luis Reservoir early in 
the season to shore up our supplies.
    And we can pay them back later on. I think that's going to 
be an action that will yield a significant amount of water this 
year. We are working with the State of California and looking 
at the Yuba Accord water as a way to help make some additional 
water available to both the State Water Project and the Central 
Valley Project.
    Senator Feinstein. What was that?
    Mr. Connor. Yuba Accord. There was some water made 
available. I can't remember the year that the Yuba Accord was 
developed.
    Senator Feinstein. That's okay.
    Mr. Connor. But it does make some water available out of 
that system for both the State Water Project and now we're 
looking at a sharing arrangement with them that we will try and 
make use of.
    We are still actively trying to promote the water transfer 
program. So the first couple I mentioned, the 215 water, Yuba 
Accord, the source shifting activity, that is stuff that we are 
trying to bring to the table, those actions, this year, to help 
shore up water supplies.
    Also water transfers. We are looking at trying to 
facilitate, particularly, East-West transfers in the Central 
Valley, just because it's going to be tough to get water from 
North to South this year.
    So we will try and shore up and make additional water 
supplies available through water transfers. Beyond that, there 
are mid-term type of actions that we're looking at, at some 
additional infrastructure, interties East to West, that might 
facilitate additional transfers in the future above and beyond 
what we've been doing historically.
    New conservation programs that we can help fund and support 
that might allow our contractors in one area of the CVP to make 
new water supplies available for transfers to those with 
smaller supplies allocations.
    And finally, refuge diversification, which we've talked 
about since 2010. Even the last couple of years using Recovery 
Act funds, we were able to drill a significant number of wells 
that helped to diversify the Refuge Water supplies.
    It's not a whole lot, but 10 to 20,000 acre-feet is very 
helpful in splitting that between the level 4 refuges and 
diversifying the Refuge supply to make that and allow CVP base 
supplies to be used for other contractors is something that 
we're still looking at.
    So that's the array of things that we're doing short term 
and mid-term to try and improve water supplies.
    Senator Feinstein. Let me ask you this. In your judgment, 
what would be the amount of acre-feet that these administrative 
changes could provide?
    Mr. Connor. I think looking at this year if you throw in 
the surplus, the 215 water, we should be in that----
    Senator Feinstein. Source shifting with the Metropolitan 
Water District of Southern California in particular.
    Mr. Connor. Source Shifting, I think would add, we're 
looking at, if we can pull this agreement together, something 
in the neighborhood of 50,000 acre-feet. You add that to the 
70,000, Yuba Accord is still a little unclear.
    But I think we'll be in the 150,000 acre-foot range and 
depending on transfers that we can additionally facilitate 
somewhere in the 150 to 200,000 acre-foot range. So that's 
getting up to--not a lot of that water shows up on the 
allocations itself, but for context, that is an 8- to 10-
percent range of south of Delta Water Service Contracts.
    Senator Feinstein. How about at the pumps? Can any changes 
be made in how the pumps are run, the reverse flow?
    Mr. Connor. Well, we are operating under the current 
existing biological opinions right now, notwithstanding the 
Court orders that have remanded to both Fish and Wildlife 
Service and National Oceanic and Atmospheric Administration 
(NOAA) Fisheries to go back and look at some of the reasonable 
and prudent alternatives.
    And because the court did not feel that those were defined 
or justified enough, we're operating under those Reasonable and 
Prudent Alternatives (RPAs) right now, and we're under a 
schedule for coming up with new biological opinion actions in 
response to court order, probably 2 years on the Fish and 
Wildlife Service biological opinion and about 4 years on the 
NOAA Fisheries biological opinion.
    Senator Feinstein. What does that translate to?
    Mr. Connor. Well, that means that until such time as there 
are new biological opinions in place as a result of the court 
orders, we're going to keep operating under the existing ones.
    Senator Feinstein. Even though they have been found to be 
wanting.
    Mr. Connor. Yes. And that's where the Court left it. I 
should say though that we have improved how we implement our 
actions under the biological opinions, and we're going to 
continue to try and do that.
    One of the criticisms of the Court was that our triggers 
for certain actions that restricted pumping were from their 
view not well-justified.
    So we've tried to work with the Fish and Wildlife Service 
and NOAA Fisheries to get better data collection, do more real-
time monitoring. Whether it's turbidity as it relates to smelt 
or actually tracking the salmon, so that we can be better 
justified in when we restrict the pumps and we know it's 
because there's fish in the immediate area.
    That had significant effect in 2011 particularly with the 
Delta Smelt, the implementation of the Fish and Wildlife 
Service Pilot program.
    Senator Feinstein. Well, that's really what I mean by 
adaptive management of the pumps.
    Mr. Connor. Yes.
    Senator Feinstein. To really track the movement of fish and 
get a better sense of the predatory aspects of other fish too.
    Mr. Connor. Yes. We're doing it better as far as monitoring 
where the fish are. We still have some ways to go on the 
predatory aspects and better understanding that aspect of it, 
quite frankly.
    Senator Feinstein. You previously allowed a permit change 
for the Jones Pumping Plant which allowed for a 500 cfs 
increase. It helped in 2010. Can you do it again?
    Mr. Connor. I think in 2010 we were looking at increasing 
pumping at the Banks plant, the State Water Project plant. And 
we had some permitting left to do because they have more 
capacity.
    Senator Feinstein. Well, didn't you say the Army Corps had 
the Banks plant?
    Mr. Connor. Well, we have to go through an Army Corps of 
Engineers permitting process to get the additional capacity, 
the 500 cfs additional capacity late in the season. That's what 
we were looking at in 2010.
    Senator Feinstein. So are you saying that Jones is the same 
thing as Banks?
    Mr. Connor. Jones is our pumping plant in the Central 
Valley Project. Banks is the State Water Project.
    Senator Feinstein. Right.
    Mr. Connor. You know, adjacent pumping plant. And they have 
more capacity. We don't really have additional capacity at the 
Jones Pumping Plant.
    Senator Feinstein. So, in other words, if you increase 
Jones Pumping, it comes from Banks, is that right?
    Mr. Connor. Well, we would look at specifically the idea we 
talked about in 2010, which was increasing the pumping 
permitting, the ability to pump more, the permit, at Banks.
    So that late in the season, post July, when there are not 
nearly the restrictions in place on pumping because the fish 
have moved out of the system, near the pumps, that we could use 
that opportunity to pump more and get it in the reservoir south 
of Delta, San Luis Reservoir, south of Delta.
    But we do need to go through the Corps of Engineers 
permitting process. The State has to be lead in that particular 
effort, and we have to be their partners in that.
    Senator Feinstein. Well, as I recall in 2009, we got about 
450,000 acre-feet from a number of administrative changes, that 
you and Interior as well were very cooperative and very helpful 
with, to get to 45 percent of the allocation south of Delta 
which is enough to allow farmers to contract, to plant, to 
harvest, to get a minimal level.
    I've been told that they have to have at least 45 percent 
of their contract. Are you going to be able to get there this 
year?

                     ADDITIONAL COMMITTEE QUESTIONS

    Mr. Connor. I don't know that we'll be able to get to 45 
percent. With the allocation, it's going to very tough. We're 
going to try and look at the opportunities to move the 
allocation up.
    And then there are, as I mentioned before, those other 
mechanisms that don't necessarily show up in the allocation, 
where we can try and make water available. All told, we're 
certainly striving as a goal to get close to that 45 percent.
    Through the allocation and additional water supplies, it's 
going to be very tough this year.
    [The following questions were not asked at the hearing but 
were submitted to the Departments for response subsequent to 
the hearing:]
     Questions Submitted to Hon. Jo-Ellen Darcy and Major General 
                          Merdith W.B. Temple
            Questions Submitted by Senator Dianne Feinstein
    Question. Why is flood control spending down in your budget for 
fiscal year 2013 when compared to fiscal year 2012?
    Answer. The fiscal year 2012 budget included $1.45 billion for 
flood risk management compared to $1.41 billion in fiscal year 2013. 
The fiscal year 2013 budget for flood risk management was developed to 
advance the highest priority studies and construction projects. Funding 
levels were based on the execution schedules identified for those 
studies and projects.
    Question. Of the six new study starts that you have proposed, five 
are for ecosystem restoration. Were there no flood control studies that 
ranked higher in your selection process?
    Answer. The one flood control new start study recommended in fiscal 
year 2013 is the ``Water Resources Priority Study''. This study 
supports the Corps flood risk management business line as a high-
priority study that will provide a baseline assessment of the Nation's 
flood risks at both a regional and national level. The study will also 
assess existing Federal, State, and local programs and strategies for 
managing flood risk, which will provide a basis for significant 
recommendations on ways to better manage flood risks at the national, 
regional, State, and local levels.
    Question. What is your selection process for your proposed new 
starts?
    Answer. New starts are initially prioritized within their assigned 
business programs. One of the most difficult tasks in preparing a 
performance-based budget is balancing the most important work, 
including new starts, across multiple business programs and sub-
programs in order to obtain the expected outcomes. New starts are 
selected when their expected outcomes are likely to be competitive with 
priorities for other high-performing activities supported in the 
budget. That prioritization is based upon overall performance 
guidelines, as follows:
  --projects funded to address dam safety assurance, seepage control, 
        and static instability correction problems;
  --mitigation, environmental compliance, and treaty requirements or 
        biological opinions;
  --projects funded to address a significant risk to human safety;
  --projects funded on the basis of their economic or environmental 
        return;
  --nonstructural flood damage reduction projects and coastal 
        navigation projects; and
  --coastal navigation projects (project phase would support jobs or 
        economic activity).
    Question. One of your proposed new starts is a $2.2 billion 
project. At $150 million a year, which is an optimistic funding level, 
it would take 15 years to complete. With flat to declining budgets, how 
will this project get completed in a timely manner?
    Answer. The Administration continues efforts to fund more 
efficiently those projects and studies with the highest return to the 
Nation in order to bring those project benefits on line sooner. In this 
constrained fiscal environment, tough decisions will need to be made 
regarding funding for other remaining ongoing projects and studies that 
are not expected to provide as high of a return.
    Question. You have a new $8 million line item in your request 
called ``Reducing Civil Works Vulnerability'' with an estimated $10 
million annual continuing cost. What does this new program propose to 
do and how much is it ultimately going to cost? What benefits will it 
provide to the Civil Works program?
    Answer. The Reducing Civil Works Vulnerability (RCWV) Program will 
increase the resilience of Corps projects and programs to the effects 
of the dynamic, often strongly interacting changes in demographics, 
land use and land cover, social values and social vulnerability, 
economic conditions, ecosystem habitat suitability, and aging 
infrastructure that arise independently from climate change and 
variability. These changing conditions could interact with each other, 
or with climate change and variability, in ways that increase the 
vulnerability of Civil Works (CW) projects, programs, missions, and 
operations. Through RCWV, the Corps will develop comprehensive 
solutions to reduce vulnerabilities and improve resilience of U.S. Army 
Corps of Engineers (USACE) missions and operations. This activity will 
benefit all USACE business lines and requires close coordination with 
complementary activities, including responses to climate change, flood 
and coastal storm damage reduction, navigation, ecosystem restoration, 
hydropower, recreation, emergency management, and water supply.
    Question. In your budget request, you generally require a project 
to have a benefit to cost ratio of 2.5; however, for flood control 
projects, you have included a number of projects with benefit-to-cost 
ratios considerably less than 2.5. These are listed with the additional 
criteria of providing substantial life-saving benefits. What does that 
phrase mean?
    Answer. Providing substantial life-saving benefits is defined by a 
substantial reduction in risk to human life due to flood inundation. 
The risk factors that are generally understood to have the most 
significant, large-scale impacts on potential loss of life from 
flooding include population at risk, warning time, and inundation depth 
and are evaluated together to provide a relative assessment of the 
life-risk associated with each project.
    Question. I notice that you have finally increased funding for the 
Lower Mississippi River from the lower numbers of the last few years to 
a request of $81.7 million. How much have we spent on the Lower 
Mississippi to maintain the navigation channel for each of the past 5 
years? Do you believe that the request is sufficient? In light of the 
new policy to not reprogram funds to this project from other projects, 
what is your plan to ensure navigation is maintained if funding runs 
short?
    Answer. Navigation expenditures for the Mississippi River Baton 
Rouge to the Gulf project for the past 5 years, including all regular, 
American Recovery and Reinvestment Act, and Supplemental appropriations 
are as follows:
  --fiscal year 2007: $76,351,238.87;
  --fiscal year 2008: $87,787,717.33;
  --fiscal year 2009: $114,634,195.08;
  --fiscal year 2010: $134,291,130.03; and
  --fiscal year 2011: $106,740,907.01.
    Approximately $151 million is anticipated to be expended in fiscal 
year 2012. Funding needs for the project vary considerably from year to 
year depending on climatic conditions in the Mississippi River basin. 
The fiscal year 2013 budget amount of $81.67 million for the project is 
appropriate given the anticipated needs in fiscal year 2013. The Corps 
monitors the channel conditions on a regular basis and uses that 
information to schedule dredging activities and maintain navigation.
    Question. Your request for the Missouri River Fish and Wildlife 
Recovery is up significantly this year to $90 million. As you know, 
many people in that area question the need for this spending in light 
of the record flooding that occurred along the Missouri River in 2011. 
They believe that this funding would be better spent on flood control 
for the basin. How do you answer those critics? If this number were 
substantially cut, what would be the potential impacts to the 
operations of the Missouri River?
    Answer. The Missouri River Fish and Wildlife Recovery Program 
(MRRP) was designed to address mitigation requirements (loss of 
habitat) for the Bank Stabilization and Navigation Project (BSNP) and 
endangered species requirements of the 2003 amended Biological Opinion 
(BiOp). The program allows the Corps to continue to operate the 
Missouri River for all eight congressionally authorized purposes--
including flood risk management and navigation--while meeting our 
environmental requirements of the Endangered Species Act (ESA).
    As stated, there is $90 million in the fiscal year 2013 budget for 
Missouri River Recovery. If that funding were cut or significantly 
reduced, the Corps would not be in compliance with the ESA and may not 
be in a position to serve all congressionally authorized purposes on 
the Missouri River.
    The Missouri River Recovery Program is not in competition with 
funding for repairs to the reservoirs, levees, and other Missouri River 
infrastructure damaged by last summer's record flows. Based on current 
estimates to date, the Corps has received all the funds required to 
return the system to pre-flood conditions in time for the 2012 run-off 
season.
    Question. There are a number of projects in your request that are 
designated as ``high performing projects.'' Many have benefit-to-cost 
ratios of 2.0 or less. What is it about these projects that makes them 
``high performing?'' How were they chosen over projects with similar 
benefit-to-cost ratios?
    Answer. High-performing construction projects anticipate high-
economic, safety, and environmental benefits to the Nation. Examples of 
selection criteria include projects that will significantly reduce risk 
to human safety, or restore a degraded ecosystem structure, function, 
or process to a more natural condition.
    Question. Based on your budget request, do you have concerns about 
potential failures of any of the Inland Waterway projects in fiscal 
year 2013? Some of them are in serious condition. Do you see a 
potential increase in unscheduled lock outages occurring due to this 
budget request?
    Answer. The Army is committed to facilitating commercial navigation 
by providing safe, reliable, highly cost-effective, and environmentally 
sustainable waterborne transportation systems. The fiscal year 2013 
budget prioritizes funds on those projects that have the highest level 
of commercial traffic, greatest risk of failure due to component 
conditions, and the greatest economic consequences of failure. The 
Corps continues to monitor the risk of component failures that could 
disrupt or stop traffic. Every effort is made to use the available 
funding in a way that will reduce the risk of scheduled and unscheduled 
outages due to mechanical failures on both high and moderate use 
waterways.
    Question. The Corps is the biggest Federal producer of hydropower 
in the country.
    What is the condition of these projects?
    Answer. The design life of these facilities is usually 35 years. 
Based on the condition assessment process used by the Corps within the 
last 3 years, 36 percent of the turbines and 17 percent of the 
generators are rated either in poor or marginal condition.
    The rating scale is as follows:
  --Good (Condition Index 8.0-10.0).--Expected to continue to provide 
        reliable service for some time in the future. Continue routine 
        maintenance and inspections.
  --Fair (Condition Index 6.0-7.9).--Expected to provide reliable 
        service in the near future. Continue routine maintenance and 
        inspections.
  --Marginal (Condition Index 3.0-5.9).--Expected to provide a marginal 
        level of service in the near future. A more detailed 
        investigation is needed to determine potential problems and 
        plan a repair strategy.
  --Poor (Condition Index 0-2.9).--Immediate intervention is required 
        to determine the problem and plan a repair strategy.
    These ratings are indicative of the aging hydropower infrastructure 
and the decaying nature of this type of equipment over time.
    Question. Has there been an increase in unscheduled outages?
    Answer. In 1999, the Corps' average unscheduled outage rate was 
1.97 percent and has steadily increased to 4.36 percent in 2011, 
compared to an electrical industry standard of 2 percent.
    Question. Is there a plan for reinvestment in these projects to 
ensure they continue to supply needed electricity?
    Answer. The Corps is implementing a Hydropower Modernization 
Initiative (HMI) to address aging hydropower infrastructure issues for 
197 generating units in 54 power plants that are not directly funded by 
the Department of Energy's Bonneville Power Administration. HMI study 
results show that an investment of approximately $4 billion over 20 
years would improve reliability, restore design level efficiencies and 
capture improvement and upgrade opportunities where they exist. The 
fiscal year 2013 budget for hydropower will fund minimum maintenance 
and does not include funding for major rehabilitation of any hydropower 
projects. In some areas of the country, the Corps is working with 
hydropower users on agreements for direct non-Federal financing of 
major maintenance work.
    Question. We provided $1.7 billion in disaster funds to repair 
damages to Corps projects in December 2011. Was this funding sufficient 
to repair all of the damages due to natural disasters? If not, did you 
include funding in your budget request for these repairs? If not, why 
not? Isn't it important to repair these projects to pre-disaster 
conditions to ensure they continue to provide the benefits for which 
they were constructed?
    Answer. Fiscal year 2012 supplemental funds focused on repairs 
resulting from historic flooding in 2011 in the Missouri and 
Mississippi River Basins that are covered by Presidential disaster 
declarations, using the following priorities:
  --Class I: Urgent and Compelling (Unsafe).--Heavily damaged projects 
        that have breached or failed where there is a probable loss of 
        life.
  --Class II: Urgent (Potentially Unsafe).--Damage projects that are 
        likely to fail where there is a probable loss of life and 
        economic damage.
  --Classes IIIA and IIIB: High Priority, including:
    --Class IIIB (Conditionally Unsafe).--Damaged systems that are 
            likely to fail where there is a potential for economic, 
            environmental, and an indirect potential for loss of life.
    --Class IIIA (High Impact to Navigation).--Damaged systems directly 
            impacting high-use navigation.
  --Class IV: Priority (Marginally Safe).--All other damaged systems 
        not meeting Class I, II, or III above.
    The Corps has made significant progress toward completing priority 
repairs. The Corps identified 11 Class I (urgent and compelling) 
projects and expects to complete interim protection for 10 projects by 
March 31, 2012. Full completion is expected (pre-event conditions 
restored) by March 31, 2013. There is one Class I project that 
anticipates completion by March 31, 2014. Similarly, the Corps 
identified 31 Class II (urgent) projects and expects completion of 
interim protection for 14 projects by March 31, 2012. Full completion 
is expected by March 31, 2013. Fourteen Class II repairs are 
anticipated to be complete by March 31, 2014, and three repairs expect 
completion after March 31, 2014. The Corps identified 31 Class IIIB 
(conditionally unsafe) projects and expects completion of interim 
protection for 19 projects by March 31, 2012. Full completion is 
expected by March 31, 2013. Twelve Class IIIB repairs are anticipated 
to complete by March 31, 2014.
    A small portion of the costs of damage repairs is not covered by 
Presidential declarations and, therefore, not eligible for disaster 
relief funding. Repairs not eligible for disaster relief funding were 
considered during development of the fiscal year 2012 work plans, and 
will again be considered during formulation of the fiscal year 2014 
budget.
                     harbor maintenance trust fund
The RAMP Legislation (requires that receipts of the Harbor Maintenance 
        Trust Fund be expended annually)
    Question. There seems to be considerable misunderstanding about the 
workings of the Harbor Maintenance Trust Fund (HMTF). Can one of you 
simply explain how it is collected and how it ties into the overall 
Corps budget?
    Answer. The Water Resources and Development Act of 1986 authorized 
the collection of an ad valorem Harbor Maintenance Tax (HMT) on cargo 
to recover costs associated with operating and maintaining Federal 
commercial navigation coastal and inland harbors within the United 
States. Most of the revenue comes from imports, but some comes from 
coastwise movement of some domestic cargo, and from passengers. Exports 
and commodities carried on the fuel-taxed inland waterways are exempt 
from the tax. The HMT is generally collected at the port of entry by 
Customs and Border Protection, based on the value of the imported 
commodities. The receipts are deposited in the HMTF by the Treasury 
Department. Spending from the HMTF is proposed in the President's 
budget for the Civil Works program and appropriated by the Congress. 
Appropriated funds are transferred from the HMTF to the Corps 
expenditure accounts to reimburse the General Fund of the U.S. Treasury 
for eligible navigation expenditures. In developing an overall budget 
for the Civil Works program, each project, program, or activity 
competes for funding on an equal basis.
    Question. Are either of you aware of the Realize America's Maritime 
Promise (RAMP) legislation (S. 412 in the Senate, H.R. 104 in the 
House)?
    Answer. Yes, we are aware of the RAMP legislation in the House and 
the Harbor Maintenance Act legislation in the Senate. These bills have 
almost identical language and seek significantly more spending for work 
that is authorized to be financed from the HMTF.
    Question. Can either of you provide us with a short synopsis of the 
bill?
    Answer. The House and Senate bills would direct the Congress to 
annually appropriate an amount equal to the total anticipated HMT 
receipts, plus interest, for any fiscal year for the operation and 
maintenance of the Corps coastal and inland navigation harbors, as well 
as the U.S. portion of the St. Lawrence Seaway, which is operated by 
the St. Lawrence Seaway Development Corporation.
    Question. I realize this is asking a lot but can either of you give 
this Committee your opinion on how the Administration might implement 
this bill if it were enacted into law? We're not going to hold you to 
this, but it is important to know what could happen.
    Answer. The Army and the Administration have emphasized the need to 
allocate Civil Works funding based on performance.
    Question. Based on what you know of the Administration's budget 
process, do you believe the Administration would provide the Corps with 
$700-800 million in additional budget ceiling or would they just 
rearrange funding within the previously planned Corps budget to meet 
the requirements of the law?
    Answer. Budget decisions are not made in advance. However, proposed 
increases generally compete for funding on the merits with other 
potential uses of those funds.
    Question. Do you believe additional resources might be worked into 
the budget to account for the law, or would other missions of the Corps 
suffer because of the law?
    Answer. As stated above, budget decisions are not made in advance.
    proposal to return harbor maintenance taxes to the states where 
                               generated
    Question. It is my understanding that California Ports provide at 
least 30 percent of the funding that goes into the HMTF. Can either of 
you confirm that number for fiscal year 2011?
    Answer. An estimated $432 million in HMT was collected on cargo 
shipped through California ports in fiscal year 2011, which was 
approximately 29 percent of the $1.469 billion in total HMT tax 
collected in fiscal year 2011.
    Question. If we assume that the Trust Fund generates $1.5 billion 
annually, then California annually contributes some $450 million to 
this Trust Fund. How much dredging of eligible harbors and waterways in 
California were reimbursed by the Trust Fund in fiscal year 2011? In 
other words, how much of our $450 million is returned to the State? It 
is my understanding that it is less than 5 percent of the annual 
revenues. This seems very inequitable.
    Answer. The HMT generated $1.469 billion in fiscal year 2011. 
Approximately $94 million was expended on California navigation 
projects in fiscal year 2011 and subject to recovery from the HMTF. 
Most of the revenue comes from imports, but some comes from coastwise 
movement of some domestic cargo and from passengers. Neither the ports 
nor the States pay this tax.
    Question. Would it be possible for the law to be changed in such a 
manner that a set percentage of the revenues generated in a given State 
would be returned to that State?
    Answer. The Congress could consider such a change or other changes 
to the current law.
    Question. What would be the impacts of such a change? Do you 
believe that the Corps would only rearrange port funding, or would this 
generate additional dredging resources?
    Answer. In the absence of a specific proposal, it would be 
difficult to say what the impacts might be or how it might affect 
Federal spending.
    Question. How can we best increase the amount of funding for the 
maintenance of our harbors and waterways without having a deleterious 
impact on other aspects of the Corps' program?
    Answer. In the current fiscal environment, the Administration 
generally has been seeking offsets for any proposed spending increases.
                      inland waterways trust fund
    Question. I note that your budget request anticipates additional 
funding being available from the Inland Waterways Trust Fund (IWTF) for 
fiscal year 2013. How do you anticipate that these additional funds 
will be generated?
    Answer. The revenues from the existing diesel fuel tax are expected 
to increase to approximately $95 million annually. This reflects an 
estimate of how forecasted changes in the broader economy will affect 
the amount of receipts collected from this excise tax. The budget also 
includes an estimate that enactment of the Administration's inland 
waterways user fee proposal, submitted to the Congress in September 
2011, would generate $80 million in receipts in fiscal year 2013. 
However, the IWTF share of the spending proposed in the fiscal year 
2013 budget is financed using the expected revenues from the existing 
tax, not from the user fee proposal.
    Question. How sure are you of these projections?
    Answer. The increase in receipts from the existing tax is a 
projection. It represents a reasonable estimate based on forecasted 
changes in the broader economy, but it is only an estimate.
    Question. If this amount is not generated, what work will you have 
to curtail?
    Answer. That would, in part, depend on how much is collected during 
the remainder of fiscal year 2012. However, if the amount collected in 
fiscal year 2013 is significantly below $95 million, the Corps would 
have to curtail some work. One option would be to spend somewhat less 
on one of our two largest ongoing inland waterways construction 
projects, either the Olmsted Locks and Dam project or the Lower 
Monongahela Locks and Dams 2, 3, and 4 project.
    Question. In light of the new cost ceiling that the Administration 
is proposing for Olmsted Lock and Dam, what is the projection of the 
share of the Trust Fund that will be utilized over the next 10 years by 
Olmsted?
    Answer. That would largely depend upon progress to enact a long-
term mechanism to enhance revenues in the Trust Fund sufficient to meet 
the cost-sharing authorized in the Water Resources Development Act of 
1986.
    Question. Several of our other locks and dams are in serious 
maintenance and rehabilitation needs. Is the funding that will be left 
after spending the necessary amounts from the IWTF to keep Olmsted on 
schedule sufficient to ensure that we will not see major failures of 
this critical infrastructure?
    Answer. Lock and dam maintenance is not funded by the IWTF. Major 
rehabilitation, however, would be in competition for funding with 
ongoing inland waterways construction projects. The fiscal year 2013 
budget prioritizes funds on those projects that have the highest level 
of commercial traffic, greatest risk of failure due to component 
conditions, and the greatest economic consequences of failure. The 
Corps continues to monitor the risk of component failures, that could 
disrupt or stop traffic. Every effort is made to use the available 
funding to reduce scheduled and unscheduled outages due to mechanical 
failures on both high and moderate use waterways.
    Question. I don't want to see one of these projects fail and 
disrupt commodity movements. These projects are getting older every 
year and if funds are not available from the Trust Fund, they have to 
come from somewhere. Has the Administration considered an aggressive 
maintenance schedule to ensure that we do not have a failure?
    Answer. The IWTF is used to fund construction activities, rather 
than operation and maintenance activities. The Administration has 
provided increased maintenance funding for those projects that provide 
the greatest economic and safety return.
                               work plans
    Question. Due to the fact that we had a continuing resolution in 
fiscal year 2011 and the Committee policy for fiscal years 2012 and 
2013 is not to include earmarks in appropriation bills, the Corps has 
been given extraordinary leeway to expend funds for the prosecution of 
water resource projects. Unfortunately, the Committee has little say, 
outside of providing criteria to consider, as to how these work plans 
are assembled. We are unsure who, within the Administration, has input 
into their preparation. It is all very mysterious to us. One thing I 
can assure you based on my review of your work plans is that funding 
would be applied differently if the Congress were doing the earmarking 
rather than the Administration.
    It appears that since fiscal year 2011, funding in some cases is 
being applied to bring projects for which the Administration has a 
policy issue of some type to a logical stopping point. Is that the 
case?
    Answer. All ongoing projects were first evaluated for a minimum 
level of funding, for example, to complete an increment of useful work 
or to otherwise meet ongoing requirements. However, all projects 
competed for such funding, whether or not there was ``a policy issue of 
some type'' with the project. After projects were funded on that basis 
where needed, the Corps work plan for fiscal year 2011 allocated the 
remaining funding to policy-consistent work.
    Question. I want to make sure we understand. All of these are 
projects that meet the standard definition used for years to determine 
funding such as technically sound, environmentally sustainable, and 
economically viable?
    Answer. Some unbudgeted projects and even some previously budgeted 
projects with changed conditions no longer meet those standards.
    Question. Are these projects that meet the tests that I just named 
being considered for funding in subsequent work plans?
    Answer. All ongoing projects that could use funding in the 
applicable fiscal year would be considered for funding, with priorities 
to be given to work based on performance and on criteria provided in 
reports accompanying the appropriations.
    Question. If not, it would appear that utilizing the work plan 
funding is a way for the Administration to shut down all projects 
except those that meet your specialized criteria for budgeting. Is that 
the case?
    Answer. The Administration is committed to maximizing the return on 
the investment in Civil Works projects. In some cases, it is clear that 
continued Federal investment in certain studies or projects is not the 
best use of available funding. Bringing those projects to a logical 
stopping point allows the Corps to invest its resources to provide a 
greater overall return to the Nation, while allowing local sponsors to 
complete the other projects if they choose to do so.
    Question. How are local sponsors being impacted by these decisions?
    Answer. The Corps works very closely with local sponsors to ensure 
that they are fully aware of funding decisions and can plan 
accordingly.
    Question. Aren't costs incrementally increased by trying to find 
these logical stopping points as opposed to continuing construction?
    Answer. While funding could be used to advance those projects, 
providing that funding would divert resources from higher priority work 
elsewhere. Therefore, for lower priority work, reaching a logical 
stopping point is sometimes the best use of available funding. Even for 
those projects that are funded to logical stopping points, the work 
plans sought to ensure safe site conditions, meet legal requirements, 
and complete useful increments of work.
    Question. Won't this end up costing the national economy more in 
the long run if you continue to curtail these projects?
    Answer. It is possible that some projects would cost more, but the 
national economy as a whole will benefit if the funding is allocated to 
higher performing activities. The intent is to optimize the use of the 
available funding and to efficiently fund those projects that are 
expected to provide the highest return to the Nation.
                           contributed funds
    Question. In fiscal year 2012, the Congress provided additional 
authority to the Corps for contributed funds. These are funds that 
local sponsors gratuitously contribute to the Federal Government with 
no expectation of repayment, is that correct?
    Answer. Yes, this authority authorizes State and political 
subdivisions thereof to voluntarily contribute funds, with no repayment 
authorized.
    Question. How is this authority being utilized?
    Answer. In accordance with the law, the Corps may accept 
contributed funds for authorized studies and projects for all water 
resources development project purposes and for all phases of authorized 
projects. Every request is reviewed to ensure that the acceptance of 
such funds is legally appropriate, that the accomplishment of such work 
is advantageous in the public interest, and that the work will not 
negatively impact other work in the affected Corps district for which 
funds have been appropriated by the Congress. Prior to acceptance of 
contributed funds, the Congress first must have appropriated some 
Federal funds for the study or construction of the project, 
respectively. Upon receiving a proposal from the non-Federal sponsor to 
provide contributed funds, the Army provides notification to the House 
and Senate Appropriations Committees prior to negotiating an agreement 
for the acceptance of contributed funds.
    Question. Concern has been expressed that contributed funds could 
be undertaken ahead of budgeted work or other work the Corps 
undertakes. How is this new authority impacting the Corps' workload?
    Answer. The Corps is required to evaluate whether the work to be 
undertaken with contributed funds will impact ongoing work for which 
the Congress has appropriated funds. The Corps has sufficient expansion 
capacity to accomplish work funded from both sources. We do not 
anticipate any negative impacts on the execution of other ongoing work, 
as demonstrated by the recent experience with American Recovery and 
Reinvestment Act (ARRA) funding where the Corps executed $4.5 billion 
of additional work without any negative impacts to ongoing work.
    Question. Concern has also been expressed that the Corps would try 
to take on more architect-engineer type work in-house with contributed 
funds. Are you continuing to contract out at least the same portions of 
work that you have in the past as required in congressional direction?
    Answer. Yes, the Corps is continuing to contract out at least the 
same portions of work as in the past, consistent with congressional 
direction.
    Question. Are there any negatives to this contributed funds 
authority that the Committee should be aware of?
    Answer. At this time, we are not aware of any negative outcomes 
associated with this contributed funds authority. We will continue to 
monitor the use of this authority.
                          section 104 credits
    Question. As you are aware, the new policy on crediting has been 
extremely controversial in California and other States. I appreciate 
how you have worked with us to ensure that the language in section 2003 
was interpreted appropriately. I am not completely happy with the 
guidance that you recently released, but it is much better than the 
draft guidance. It is my understanding that credit will not be afforded 
prior to the draft report stage of the project. Is that correct?
    Answer. Yes. When a project partnership agreement has not yet been 
executed, an in-kind memorandum of understanding (MOU) must be executed 
prior to a non-Federal sponsor initiating construction work in order 
for such work to be eligible for credit. As provided in the guidance, 
an in-kind MOU for construction work may not be executed prior to the 
release of the draft feasibility report for public review.
    Question. There could be cases where that may be too restrictive 
for some flood control agencies that are trying to maximize flood 
protection for their citizens. In those limited cases, will you 
consider exceptions to this policy?
    Answer. Yes, exceptions to this policy will be considered in those 
very limited cases where a compelling reason can be demonstrated why 
the construction work for which credit is sought must be undertaken 
prior to the release of the draft feasibility report for public review.
    Question. If lands are purchased as a part of the credited work, 
are those lands generally credited against the lands required for the 
overall project?
    Answer. Yes. Section 221 does not alter any responsibility of a 
non-Federal sponsor to provide or pay for lands, easements, rights-of-
way, relocations and disposal areas (LERRDs) for a project, nor does it 
affect the affording of credit for such LERRDs. Any LERRDs required for 
a project, including LERRDs associated with work determined to be 
integral to the project, will continue to be credited as LERRDs toward 
the non-Federal cost share.
             interagency performance evaluation task force
    Question. After Hurricane Katrina, the Interagency Performance 
Evaluation Task Force was charged with looking at the technical issues 
surrounding the levee failures in New Orleans. Another group was 
charged with reviewing the policy and decisionmaking process that led 
to the system that was in place at the time. It is now 6\1/2\ years 
after Katrina yet funding remains in the budget request, at an even 
higher level than in the past. The justification shows an allocation of 
about $12 million through fiscal year 2012, but an additional $53 
million in funding needed to complete.
    What exactly is this funding for?
    Answer. The Interagency Performance Evaluation Task Force (IPET) 
assessment reviewed the technical issues associated with the 
infrastructure performance during Hurricane Katrina. The Hurricane 
Protection Decision Chronology (HPDC) reviewed the policy and 
decisionmaking associated with the New Orleans hurricane protection 
system over several decades leading up to Katrina. Those two 
assessments were the drivers for the Chief of Engineers announcement of 
the ``12 Actions for Change'' initiative in August 2006. That strategic 
program was initiated to incorporate the lessons learned from the two 
post-Katrina assessments into Corps policy, practice, and culture in 
order to modify the way the Corps plans, designs, constructs, and 
maintains its infrastructure. The ongoing program continues to be 
funded under the IPET/HPDC Lessons Learned Implementation remaining 
item. This is an ongoing program, aimed at continuous learning and 
application of lessons from Katrina and subsequent experience.
    The strategic program continues being executed by four national 
teams. The four national teams established multiple project delivery 
teams to execute specific tasks in support of the program. The teams 
have been working on policy, guidance, methods, tools, technology, and 
training to expand USACE's use of systems-based approaches, increasing 
the use of risk management in our business practices and 
decisionmaking, communicating risk more effectively, and giving greater 
priority to technical competence and professional accountability. While 
all actions are interrelated, each of the four teams has a focus area:
    Comprehensive Systems Approach.--Emphasizes an integrated, 
comprehensive and systems based approach incorporating anticipatory 
management to remain adaptable and sustainable over time. These changes 
require USACE to use collaborative, adaptive planning and engineering 
systems throughout the project life cycle to effectively manage its 
aging infrastructure in an environmentally sustainable manner through 
explicit risk management. Approximately $3.6 million has been allocated 
to this team through 2012. The fiscal year 2013 budget includes $3.6 
million to continue development of supporting technologies to improve 
the effectiveness of post-authorization evaluations and assessments of 
incremental change over time; address climate change impacts to water 
resources projects, with particular emphasis on developing the 
framework for how climate change and sea level change should be 
considered in making decisions for existing infrastructure investments; 
and continue to implement the consistent nationwide project datum and 
associated subsidence standards and certification.
    Risk Informed Decisionmaking.--Emphasizes integrated risk 
management. These changes require USACE to use risk and reliability 
concepts in planning, design, construction, operations and major 
maintenance and to improve its review of completed works program by 
including an assessment component with the goal of ensuring safe, 
reliable, and resilient infrastructure. Approximately $2.5 million has 
been allocated to this team through 2012. The fiscal year 2013 budget 
includes an additional $2 million to further develop supporting methods 
and technologies to support the transformation of Inspection of 
Completed Works from project element inspection to a risk-based system 
assessment; advance the understanding of risk and reliability including 
establishment of a Risk Gateway containing resources for webinars, 
training, and the development of a second generation risk model to 
broaden the techniques used in New Orleans for Corps-wide use.
    Risk Communication.--Emphasizes clear and candid communication of 
risk both internally and externally, supporting risk-informed 
decisionmaking. These changes require USACE to improve its 
effectiveness in communicating risk; to coordinate a risk management 
approach and policy with all agencies and stakeholders; and to 
specifically establish ways and means to increase public involvement in 
informed risk decisionmaking. Approximately $1.5 million has been 
allocated to this team through 2012 focusing most on risk communication 
skills. The fiscal year 2013 budget includes an additional $300,000 to 
provide training on public participation skills and methods. A pilot 
will also be conducted to test those methods in the USACE 
infrastructure environment.
    Professional and Technical Expertise.--Emphasizes professionalism 
and technical competence. The purpose is to enable development of 
expert Corps capability to provide safe, reliable, adaptable, 
sustainable systems. Approximately $1.5 million has been allocated to 
this team through 2012. The funds have been used to assess 
competencies, gaps, methods of delivery, and sustainable strategies for 
maintaining and building core competencies. The fiscal year 2013 budget 
includes an additional $100,000 to survey technical staff and input 
technical competencies into Army's Competency Management System, a 
recently developed tool that will help USACE managers to better 
integrate competency gaps into the hiring process.
    The total cost for the four focus areas, before consideration of 
post-2011 assessment activities, is $62 million. This figure does not 
include $9.9 million to update the system assessment to learn from the 
historic flooding of 2011, and develop ways to apply those lessons, as 
the scope and cost for the update were only recently developed.
    Question. Why aren't the new activities split out as a new start 
studies? It seems like this Katrina study is just morphing to fit 
whatever crisis is at-hand.
    Answer. The 2011 flooding in the Greater Mississippi Basin was 
among the largest and most damaging in this century, comparable to the 
major floods of 1927 and 1993. Due to the historic nature of the 
flooding, a post-flood assessment of the entire system performance is 
needed to review the operational decisionmaking process and to identify 
opportunities for improving future system operation and performance. 
The assessment is intended to evaluate performance of the overall 
system and the decision and communication processes and recommend 
operational changes, both within and outside of existing authorities 
and policies.
    The post-flood assessment and the New Orleans assessment are 
interdependent in that they employ similar analytic methods, contribute 
to the same objective (to improve the operations and performance of 
Civil Works water resources systems), and will be applied jointly to 
the modification of policy, practice, and culture. Consequently, the 
post-2011 flood assessment was integrated into the IPET/HPDC Lessons 
Learned Implementation remaining item.
    Question. Do you envision this as a permanent line item in the 
budget or is there a definitive endpoint to the proposed activities?
    Answer. The total cost for the scoped activities described above is 
$71.9 million, before consideration of future price level adjustments. 
The activities will compete for available funding until completed.
         performance-based budget and development of work plans
    Question. The Administration claims the budget funds the highest 
performing projects and programs in its water resources missions. It 
appears to us that the budget, as proposed, is woefully short of 
funding those projects that contribute to the national economy and 
provide benefits and services to the Nation through navigation and 
flood control. The Congress generally has increased the agency's budget 
above the Administration's request and expanded the list of projects 
and types of projects funded. Still, fundamental questions about what 
the agency does and how it operates are being asked by some observers. 
The perspectives on how to proceed among Members of Congress, project 
sponsors, fiscal conservatives, environmental interests, and other 
stakeholders vary widely.
    What performance-based criteria does the Corps use in determining 
how much funding it proposes for planning and construction projects? 
Not the individual projects or studies but the overall funding levels 
for the accounts?
    Answer. Performance criteria are not used to set account totals. 
Rather, the Corps evaluates each planning and construction project 
based on its individual merits, using the criteria applicable for that 
type of project, and account totals are established by considering the 
relative returns of investments among the various accounts, within the 
totals available for Civil Works.
    Question. It seems that the monetary benefits that Corps 
infrastructure provide to the national economy is not considered when 
determining funding levels. How do you determine the level of funds 
within each business line?
    Answer. Funding levels within each business line are determined at 
the project level and considering the relative return of investments 
within each business line, within the totals available for Civil Works.
                   white house navigation task force
    Question. We read with interest in the Administration's budget 
proposal to create a White House navigation task force.
    What is the scope and intent of this task force?
    Answer. Details of the task force's scope, intent, and composition 
are being developed. The task force will provide a forum for developing 
a broad strategy for investments in support of navigation and may also 
seek to coordinate amongst the many Federal navigation programs. The 
task force would develop this strategy through a multimodal view of the 
Nation's investments in navigation, whereas the Corps is focused on the 
type of infrastructure that the Corps has constructed and maintains.
    Question. Who will be included on the task force?
    Answer. Details of the task force composition are being developed.
    Question. Will the Corps get a seat at the table?
    Answer. Details of the task force composition are being developed, 
but we anticipate that the Corps would be involved.
    Question. What about the navigation industry?
    Answer. Details of the task force composition are being developed.
                     water resources modernization
    Question. The President's fiscal year 2013 budget proposes a new 
Water Resources Modernization Initiative as the foundation of a 
comprehensive strategy for investing in the Nation's water 
infrastructure. We are pleased that the President is committed to 
investing in a 21st Century Infrastructure for America--including its 
water infrastructure--as a means to strengthen the Nation's economy, 
create jobs, and bolster our long-term global competitiveness.
    What specific proposals will the Administration include in this new 
modernization initiative?
    Answer. The Administration and the Corps are exploring options for 
modernizing water resources laws, policies, and practices, including 
project financing. This effort will be very broad in scope. We want to 
consider what improvements are possible within existing law and policy, 
what the limitations of those improvements may be, as well as whether 
policy revisions or new authorities should be proposed. On the topic of 
funding, which is a part of this effort, the Administration has already 
proposed a user fee to help finance inland waterways capital 
investments. Proposals to change the way that the Nation finances 
investments in our other program areas may also be considered.
    We are open at any time to a discussion with the Congress, our 
cost-sharing partners, or other stakeholders on your and their 
suggestions to help us to improve current water resources laws, 
policies, and practices.
                                 ______
                                 
              Questions Submitted by Senator Patty Murray
               army corps of engineers--levee vegetation
    Question. Assistant Secretary Darcy, as you know from our previous 
conversations my home State and the entire west coast are very 
interested in the ongoing process regarding levee vegetation. Let me be 
clear--we must make sure that our levees are safe. But we also have to 
balance levee safety with meeting other requirements, such as the 
Endangered Species Act (ESA) and our Federal tribal treaty 
responsibilities.
    As you know, in the West vegetation on levees has been a critical 
tool in ensuring that levee sponsors are meeting ESA requirements and 
tribal treaty obligations. My colleagues from Washington State, and I 
have been working with you and your staff for several years on the 
draft Policy Guidance Letter (PGL) that will ultimately completely 
transform the process by which the Corps issues variances to allow 
levee vegetation.
    As I read the latest draft guidance, published in February, I'm 
pleased that some of the issue we've brought to your attention have 
been included. However, I continue to have concerns about how this PGL 
will actually be implemented on the ground.
    In particular, I am concerned about the ambiguity in the PGL 
regarding the ESA and tribal treaty obligations. I'm pleased to see the 
Corps acknowledge that these important requirements must be met, but 
can you please provide clarity on how the Corps will address this in 
variance applications or System Wide Implementation Framework plans?
    Answer. The Corps recognizes that in executing its authorities and 
responsibilities to promote structurally sound levee systems in 
furtherance of life safety, the agency must also address environmental 
and natural resource needs and the rights and interests of tribal 
nations through compliance with all applicable laws, regulations, and 
treaties. In instances where multiple interests are involved, the Corps 
will collaborate with levee sponsors, natural resource agencies, and 
tribal nations to develop solutions to meet the mandates of all 
applicable environmental and tribal requirements, while recognizing the 
paramount importance of protecting human life. The Corps and the levee 
sponsors will be able to use either the vegetation variance process or 
a more comprehensive system-wide improvement framework (SWIF) process 
to develop strategies for addressing the multiple objectives and 
constraints that may apply to a particular levee system.
    The Corps believes that a reasonable approach to addressing these 
responsibilities and developing sustainable solutions is to review the 
environmental impacts of the application of levee system standards as 
they are applied to the site-specific circumstances. With this 
approach, the Corps recognizes that each levee system is a unique 
flood-risk reduction system that operates within the broader and 
equally unique local ecosystem. This approach also recognizes that the 
analysis of potential environmental impacts is dependent upon future, 
undetermined actions and decisions of the levee sponsors who operate 
and maintain the levee systems.
    The Corps will work closely with the levee sponsors, appropriate 
resource agencies and tribal nations, as well as other interested 
parties, to complete the environmental compliance process. As part of 
that process, the levee sponsors will be required to:
  --provide the background information and documentation necessary to 
        complete environmental requirements; and
  --implement any measures that are required as a product of the 
        environmental compliance as a condition of their choosing to 
        participate in the program for rehabilitation assistance under 
        Public Law 84-99.
Environmental compliance on levee systems operated and maintained by 
the Corps remains the responsibility of the Corps.
    Question. The Seattle District in my home State of Washington has 
been intimately involved in managing vegetation on levees for many 
years and has an on-the-ground working knowledge of the region. I 
understand the need for Corps Headquarters to be involved in this 
process but have concerns about Headquarters employees who have never 
been on the ground in my State making final decisions on something this 
important. As you finalize the PGL, what steps will you take to 
delegate decision authority for the approval of variances and SWIF 
plans to the District or Division level?
    Answer. Both the vegetation variance process and SWIF policies will 
be reviewed periodically and process improvements will be considered, 
including future delegation of decision authority, based on 
demonstration of consistent application of the PGL nationally and 
lessons learned.
    Question. Ms. Darcy, making a change of this magnitude in the 
process for variance applications is likely to be costly to levee 
sponsors--particularly in the Washington, where as I mentioned we have 
had a District-wide variance in place for several years. What financial 
and technical resources will the Corps provide to levee sponsors who 
want to stay eligible for the Public Law 84-99 program, but do not have 
the capacity to develop the technical elements needed to complete a 
variance application or a SWIF plan?
    Answer. The Corps will work closely with levee sponsors to help 
determine the most viable option to meet Corps policies and standards. 
Both the vegetation variance process and SWIF policy encourage a 
collaborative approach. The Corps will assist levee sponsors through 
these processes by providing technical expertise, levee data (if 
available), and other applicable subject matter experts. For example, 
the vegetation variance process encourages involving the Corps 
vegetation experts as part of the scoping of variance packages, to 
determine early in the process the required environmental and 
engineering analysis.
    Question. The Corps' own Engineering Research Development Center 
(ERDC) analysis of levee vegetation produced--at best--mixed results. 
The ERDC report indicates that, in contrast to the standing Engineer 
Technical Letter (ETL), vegetation can actually be good for levees in 
some cases. It is critical that the Corps provide resources for 
continued scientific investigation into this issue. What are your 
plans, with ERDC, to implement a prioritized research program to 
provide a regionally appropriate, technical basis for a vegetation 
management policy that supports our shared objectives of safe levees, 
riparian habitat that supports salmon recovery and meets ESA 
requirements, and cost-effective management for levee sponsors and the 
Corps?
    Answer. The results of the initial ERDC vegetation research 
indicated that:
  --In some cases, tree roots could have a potential shallow 
        reinforcing effect that improves slope stability, but the 
        weight of the tree and wind loads on the tree could have a 
        negative impact on overall deeper seated slope stability; and
  --At some locations where a tree was found to increase the factor of 
        safety under one set of conditions, that same tree was found to 
        decrease the factor of safety when other likely conditions were 
        considered.
Overall, impacts of vegetation on levees remains a complex topic, and 
the Corps intends to conduct additional research and work with external 
scientific professionals to further identify future vegetation research 
topics that address both short-term and long-term needs. A follow-up 
ERDC report on this topic is being developed.
                                 ______
                                 
            Questions Submitted by Senator Mary L. Landrieu
    Question. Secretary Darcy and Major General Temple, thank you for 
your testimony today. As you know, Corps of Engineers projects are 
vitally important in Louisiana. For decades, the people of my State 
have been fighting a noble battle to save the most productive and 
environmentally significant coast and delta in the world. We are losing 
25 to 35 square miles of wetlands per year--about a football field an 
hour--which places millions of lives and critical national resources at 
alarming risk.
    While I have concerns about many Corps issues, I recognize that the 
Corps has consistently been woefully underfunded, which presents great 
challenges in addressing the needs of Louisiana and the Nation.
    I am pleased to see that the Administration requested funding for 
Louisiana Coastal Area projects. However, we simply must find a way to 
make greater investment in critical flood protection, navigation, and 
restoration projects. Some people may say that this country cannot 
afford these investments--I say we cannot afford not to make them. Last 
year's historic flooding along the Mississippi River provided a perfect 
example of how wise and timely investment in construction and 
maintenance can save lives and resources.
    Since 2008, the Corps' construction budget has been reduced by more 
than 50 percent, yet our backlog is greater than $60 billion in 
projects nationwide. This near halt in construction funding has dire 
consequences across the country. But it is most concerning after what 
we learned in Louisiana from Hurricanes Katrina and Rita--the approach 
of ``patch and pray'' when it comes to flood protection does not work.
    I also have continued concerns about insufficient funding to 
address the Nation's dredging needs, particularly when channel users 
pay a fee that would cover the costs, but the total amount being 
collected is not being used for dredging. On average, full channel 
dimensions are available only one-third of the time at the busiest 59 
harbors in the United States. I am pleased that the budget provides a 
12-percent increase from last year's request for use of Harbor 
Maintenance Fund dollars, including an increase for dredging on the 
Lower Mississippi, but this still will not meet the needs of the Nation 
or the State of Louisiana.
    As you know, I have been frustrated by the number of years the 
Corps spends studying projects. In Louisiana, time is not on our side, 
and we cannot afford 10 years to study flood control and restoration 
projects. I understand the Corps is working toward more efficient 
processes. Can you provide some details about the Corps efforts to 
decrease the number of years spent studying projects?
    Answer. A new planning modernization initiative was introduced in 
January 2011 that is focused on risk-based scoping to define the 
appropriate levels of detail for conducting investigations, so that 
recommendations can be captured, succinctly documented, and completed 
within a goal of 18 months. Corps leadership has issued guidance 
mandating all typical feasibility studies be completed in 18-36 months. 
The proposed process should dramatically shorten the amount of time and 
cost of conducting planning studies and increase corporate and 
individual accountability for decisions. This process will save time 
and money for both the Federal Government and the project sponsors.
    As part of this initiative, all ongoing feasibility studies are 
under review. The Corps will reclassify to inactive those studies with 
limited likelihood of success, so funding can be focused on the most 
credible and viable projects to improve feasibility study execution and 
delivery. Studies that are classified as inactive will be considered 
for future year funding, but this approach will enable the Corps to 
more efficiently fund those studies that are most likely to result in 
high-performing projects.
    I continue to hear from a number of concerned ports, businesses, 
and citizens about consistent navigability along the Lower Mississippi 
River. The Corps was responsive to these concerns and provided 
additional dredging dollars earlier this year, but I believe we need to 
be more proactive. The Mississippi is the central artery for navigation 
for nearly the entire Nation. As you know, 40 percent of the entire 
continent is drained by the Mississippi River Delta. This drainage 
basin (approximately 1,234,700 square miles) covers about 40 percent of 
the United States and ranks as the fifth largest in the world.
    The inland waterways of the United States include more than 25,000 
miles (40,000 km) of navigable waters. Much of the commercially 
important waterways of the United States consist of the Mississippi 
River System--the Mississippi River and connecting waterways.
    Question. I appreciate the increase for dredging on the Lower 
Mississippi, but does your request provide enough funds to ensure that 
the Mississippi River remains open for business at the maximum 
authorized depths?
    Answer. The Corps will continue to keep the river open for 
navigation, except during flood or other emergencies. The river will be 
dredged to the maximum authorized depth in some areas. In other 
reaches, there could be some reductions in channel width at certain 
times of the year, as is the case with other navigation projects around 
the country. The budget includes $81.7 million for the Lower 
Mississippi River Baton Rouge to the Gulf project, which is the highest 
amount ever budgeted for this project. The Corps monitors the channel 
conditions on a regular basis and uses the information to schedule 
dredging activities and maintain navigation.
    Question. How are you balancing this critical need with the needs 
that other essential waterways are facing across the State of Louisiana 
and the Nation?
    Answer. The Corps focuses on funding those navigation projects with 
the highest level of commercial usage, greatest risk of failure, and 
greatest economic consequences. Other factors taken into consideration 
include:
  --whether the project serves as a critical harbor of refuge or a 
        subsistence harbor, or supports public transportation, U.S. 
        Coast Guard search and rescue operations, the national defense, 
        or other Federal agency use; and
  --the reliance on marine transportation for energy generation or home 
        heating oil deliveries, and the level of commercial use (albeit 
        less than a medium level of commercial use).
                            inland waterways
    Question. Ms. Darcy, I have grave concerns regarding the Olmsted 
Lock and Dam project. This project was authorized by the Congress in 
the Water Resources Development Act of 1988 at an estimated project 
total cost of $775 million. The most recent cost estimate is more than 
$3 billion. The August 1985 Corps of Engineers feasibility report that 
the Congress used to authorize the project in 1988 assumed a 7-year 
duration. Funds to initiate construction of the Olmsted project were 
appropriated in fiscal year 1991, which means the project should have 
been complete in 1998.
    Can you provide an update on the project's current status and an 
explanation of the inordinate delays and the cost increases associated 
with those delays? Would you say it about 50-percent complete? What is 
the Corps projection for completion year?
    Answer. The Olmsted cost increase to $2.918 billion (October 2011 
price levels) is attributed primarily to low initial estimate, which 
increased substantially in light of construction and contractual 
complexities associated with the innovative ``in-the-wet'' construction 
technique. This method also lengthened the duration of construction 
which pushed costs into an unanticipated period of higher than average 
inflation associated with building materials utilized for construction.
    There are several factors that have contributed to the low initial 
cost estimate. Factors that were unknown when the project was 
authorized include the negative impacts on productivity due to river 
conditions (elevation and velocities) and the complexity of shell 
fabrication necessitated by the seismic condition at the site. Early 
on, a decision was made to use the innovative ``in-the-wet'' 
construction method. After constructing and setting the first set of 
shells in 2010, the government and contractor realized that the effort 
associated with fabrication and setting these large pieces of precast 
concrete and filling them with tremie concrete was not like any work 
they had previously experienced or previously had estimated. The 
construction challenges associated with developing this innovative 
method of construction have been overcome, but required a lot more 
effort than was originally envisioned.
    Roughly 77 percent of the increase in the estimated total cost of 
the project, in real terms (above inflation) is associated with the 
increase in the cost of constructing the dam.
    The project will be approximately 50-percent complete by the end of 
fiscal year 2012.
    The Army Corps is working on a Post Authorization Change Report on 
the Locks and Dams 52 and 53 Replacement project (Olmsted Locks and 
Dam), Illinois and Kentucky. The report re-estimates the project's 
benefits and costs and on that basis recommends that the Congress raise 
the authorized total cost for the project to $2.918 billion (October 
2011 price levels). This is roughly a 95-percent increase in real terms 
from the total cost now authorized--$775 million (October 1987 price 
levels). The budget includes a general provision to authorize this 
proposed increase in the total cost for the project, and provides $144 
million to continue construction of the project in fiscal year 2013. 
The Post Authorization Change Report is currently under review and is 
expected to be transmitted to the Congress shortly.
    The report estimates that the Olmsted Locks and Dam part of the 
project will become operational in fiscal year 2020, based on the 
minimal project features required for the dam to hold the pool and pass 
navigation through the locks. Physical Completion for the dam contract 
is projected to be in fiscal year 2021, including contractor de-
mobilization and equipment salvage. The remainder of the work, 
including other required facilities, buildings and grounds, river 
dikes, demolition of Locks and Dams 52 and 53 and permanent operating 
equipment is projected to be finished in fiscal year 2024, thus 
completing the project.
    The schedule in the report assumes that the Corps will spend an 
average of about $150 million per year on this project, consistent with 
recent funding levels and the level of receipts to the Inland Waterways 
Trust Fund (IWTF) under current law.
    The report estimates that the maximum that the Corps could use 
efficiently and effectively on the remaining work on this project is 
around $215 million per year, or roughly $65 million more per year than 
the $150 million per year funding stream assumed in this report. 
Enactment of legislation that provides additional receipts to the IWTF 
would be necessary to reach the higher level of funding, which could 
cut up to 3 years from the project schedule, resulting in savings of 
approximately $150 million.
    Question. What is the Corps doing to address concerns about the 
experimental ``in-the-wet'' construction approach currently being used 
to construct the project? Have you considered going back to the 
traditional cofferdam construction approach?
    Answer. The Corps has assembled a team of experts to consider 
alternative construction techniques. The team is developing a concept 
level design for ``in-the-dry'' construction to a degree that can be 
used to prepare a reliable cost estimate and schedule suitable for 
comparison to the ongoing ``in-the-wet'' construction for the navigable 
pass portion of the dam. The Corps will evaluate the team's 
recommendation based on the concept level design and certified cost 
estimate by the summer 2012 to determine the most cost-effective way to 
complete construction.
    Question. What impact do the delays and cost increases have on 
other inland waterway construction projects? (Note: The Inner Harbor 
Navigation Canal Lock Replacement Project has been waiting for 
replacement for more than 50 years.)
    Answer. For the Civil Works program as a whole, completing the 
Olmsted project is a priority. Based on the current level of revenues 
to the IWTF, the Post Authorization Change Report includes a schedule 
based on continued funding of the Olmsted project at approximately $150 
million annually. Enactment of legislation that provides additional 
receipts to the IWTF would be necessary to reach the higher level of 
funding for the Olmsted project, which could cut up to 3 years from its 
schedule and also result in savings of approximately $150 million. Work 
on some other inland waterways projects is being suspended due to a 
lack of resources in the Trust Fund to continue construction. This 
highlights the importance of enacting a long-term mechanism to increase 
receipts to the IWTF.
    Question. I understand that by September 30, more than $748 million 
will have been allocated from the IWTF for the Olmsted project. This 
means that the inland waterway industry has already paid double the 
amount that was intended when the project was authorized, the same is 
true for the general taxpayer.
    What are the average annual economic benefits that the Olmsted 
project is expected to return to our national economy when the project 
is finally completed? Is this average annual economic benefits figure 
also a measure of the cost to the Nation's economy of each year that 
the Olmsted project's completion is delayed?
    Answer. Average annual net benefits, that is, total average annual 
benefits less the total annual construction, operation, and maintenance 
costs needed to generate those benefits, is an appropriate measure of 
the long-term economic impact of the Olmsted project. Economic analyses 
in the draft Olmsted Locks and Dam Post Authorization Change Report, 
which is currently under review, indicate that the Olmsted project will 
generate an estimated $875 million in total average annual National 
Economic Development (NED) benefits. The average annual cost required 
to generate those NED benefits is estimated as $235 million. Thus, the 
indicated average annual net benefit is an estimated $640 million.
    These estimates reflect differences in benefits and costs over a 
theoretical 50-year period, after discounting. They do not reflect the 
benefits and costs associated with any particular subset of those 
years, such as the actual construction period. The estimates also are 
based on a variable discount rate, as provided in section 80 of the 
Water Resources Development Act of 1974, which does not reflect the 
long-term opportunity cost of capital for the economy as a whole. 
Finally, any delay in project completion at this point is due to the 
low level of receipts in the IWTF. The Administration has proposed 
legislation to address that problem.
    Question. From this point forward, what is the amount of additional 
economic benefits that will be lost to the Nation's economy because of 
further delays in the Olmsted project's completion?
    Answer. The Olmsted cost increase to $2.918 billion (October 2011 
price levels) is attributed primarily to a low initial estimate, which 
increased substantially in light of construction and contractual 
complexities associated with the innovative ``in-the-wet'' construction 
technique. This method also lengthened the duration of construction, 
which pushed costs into an unanticipated period of higher than average 
inflation associated with building materials utilized for construction.
    The schedule for this project reflects the nature of the work that 
remains. It changes over time, as the Corps incorporates lessons 
learned and reassesses the challenges that it will encounter in 
completing this complex engineering project. When the project is 
complete, the Nation's economy will realize all of the project's 
benefits. The ``delay'' reflects the magnitude of the challenge, which 
has been more daunting than expected.
    For the 91 million tons of traffic that pass through Locks and Dam 
52 and the 81 million tons that pass through Locks and Dam 53 annually, 
Olmsted offers a new reliable project in place of the two aging and 
unreliable projects. Much of the savings estimated in the Post 
Authorization Change Report occur from avoiding anticipated cyclical 
lock maintenance service disruptions at Locks and Dams 52 and 53. 
Completing Olmsted will also save $32 million annually in Federal 
maintenance costs now spent to maintain the locks and dams to keep them 
operating.
                  beneficial use of dredged materials
    Question. I understand that approximately 50 million cubic yards of 
dredged material are dumped into the ocean annually.
    Can you provide any general data about how beneficial uses--such as 
nourishment of beaches with clean sand or development of wetland 
habitats--compare to current and other alternate disposal options?
    Answer. The Corps strives to use dredged material beneficially when 
technically feasible, environmentally acceptable, and cost effective. 
Corps regulations (CFR 335.7, 53 FR 14902) require the Corps to 
identify the least costly dredged material placement alternative that 
is consistent with sound engineering practices and meets all Federal 
environmental requirements. This is known as the Federal Standard or 
Base Plan. In some cases dredged material may be used beneficially at 
about the same cost as the Federal Standard. However, the majority of 
beneficial use options are typically more costly than other placement 
options, and there would need to be a non-Federal sponsor willing to 
pay all or a portion of the additional costs beyond the placement 
method found to be the least costly, environmentally acceptable method 
for the navigation project.
    Question. Can you tell us more about the Corps Regional Sediment 
Management Program? I understand it is still in its infancy but am 
interested in hearing about its successes and about plans to expand the 
program.
    Answer. The Regional Sediment Management (RSM) program supports 
sustainable solutions to optimize the use of sediments to benefit a 
region. Under the RSM program, the Corps has been successful in 
identifying and understanding regional sediment transport processes 
along the Nation's shorelines and is now applying this knowledge to 
implement solutions to better manage and use sediments. These solutions 
span multiple projects, programs, State, local, and political 
boundaries and allow the Corps to better manage sediment regionally.
    Examples of key successes of the RSM program include the 
Jacksonville District's St. Johns County, Florida RSM initiative, which 
linked navigation channel maintenance dredging with the adjacent shore 
protection project to leverage funds, technical capabilities, and most 
importantly, manage the sediment to accomplish the missions of both 
projects. The Mobile District is working with stakeholders to develop 
an RSM strategy to place material dredged from the Upper Mobile Harbor 
within Mobile Bay to create 1,000 acres of marsh habitat. The strategy 
will reduce the amount of sediment taken to the offshore placement area 
40-miles south of the Upper Mobile Bay navigation channel and provide 
environmental benefits. The Portland District has collaborated with 
stakeholders to identify and permit four near-shore placement areas for 
the mouth of the Columbia River. Rather than placing material in the 
offshore deepwater placement area, where sediment is lost to the 
system, the material will be placed in the new near-shore sites to feed 
adjacent shorelines, create environmental habitat, and assist with 
maintaining the jetty infrastructure by reducing erosion along the base 
of the structure.
    The RSM program will continue to move forward engaging stakeholders 
to adopt regional approaches to sediment management. Approximately $1.8 
million is included in the fiscal year 2013 budget for the RSM program.
                          wetlands mitigation
    Question. The Corps New Orleans District Office recently adopted 
the Modified Charleston Method (MCM) to determine mitigation 
requirements for 404 permits. I understand that in some cases, the 
mitigation ratio has more than doubled. This drastic increase in 
mitigation requirements has caused a significant economic impact and 
has the potential to bankrupt vital public works projects and 
development efforts.
    The New Orleans District's response to public comments on the 
adoption of the new method states that they did ``not have the 
resources to conduct an economic impact study'' regarding the impacts 
of MCM implementation. How is the Corps working to balance 
environmental impact, economic concerns, and the need to proceed with 
important public works projects?
    Answer. An economic analysis is not required prior to adopting and 
implementing impact and mitigation assessment methodologies. However, 
the Corps does consider the effects to the regulated public when 
adopting new policies or guidance. In this case, the need to provide 
applicants and our regulatory staff with a rapid and repeatable method 
to assess impacts and mitigation in a consistent and predictable manner 
was a major consideration in the adoption of the MCM. When planning 
projects that may require work in wetlands, applicants should be aware 
that the Corps evaluates each project to determine compensatory 
mitigation requirements for unavoidable impacts in accordance with the 
Federal mitigation rule. The applicant can use the MCM to assess the 
impacts and to determine the amount of mitigation that may be required 
and then contact existing mitigation banks within the watershed to get 
an estimate of the mitigation cost. This information may be used by the 
applicant in its economic analysis for its proposal. The applicant may 
determine that the cost of mitigation is excessive and then work to 
redesign the project to avoid or minimize wetland impacts so that costs 
associated with mitigation are reduced.
    We have examined the impacts of the MCM on mitigation requirements 
for permits issued between May 2011 and October 2011 and our analysis 
reveals that the mitigation ratios have increased from 1.6:1 to 2.4:1 
on an acre basis. Although this shows an increase, the ratio does not 
represent a doubling of mitigation requirements.
    Subsequent to the publication of the Federal Mitigation Rule in 
April 2008, applicants are required to include in their application ``. 
. . a statement describing how impacts to waters of the United States 
are to be avoided and minimized. The application must also include 
either a statement describing how impacts to waters of the United 
States are to be compensated for or a statement explaining why 
compensatory mitigation should not be required for the proposed 
impacts.'' Our mitigation rule encourages the use of assessment tools, 
if available, when determining mitigation requirements.
    A permit is issued if the district commander determines that the 
proposed project complies with the section 404(b)(1) guidelines and is 
not contrary to the public interest. Mitigation for unavoidable impacts 
is part of this determination. Our goal is to provide applicants with a 
balanced decisionmaking process to ensure aquatic resource protection 
while allowing economic development to move forward in accordance with 
Federal laws and regulations.
    New Orleans District MCM is an improvement over the previous 
process used for reviewing mitigation proposals. Previous mitigation 
estimates were based on the best professional judgment of the 
individual project managers reviewing the mitigation proposal. 
Comparatively, the MCM methodology provides a framework for more 
consistent, repeatable, and objective results. The MCM is rapid enough 
for the applicant to use and provides the applicant the ability to 
estimate their mitigation requirements based on the types of resources 
they propose to impact and other factors. Other factors that are 
considered include those that are related to the type of impact that is 
proposed, such as rarity of the habitat, habitat condition, degree of 
hydrologic disturbance, length of time impacts are expected to last, 
the type of impact (e.g. clearing, draining, dredging, filling, etc.), 
and potential cumulative impacts. Some of the mitigation factors 
considered include type of mitigation (re-establishment, 
rehabilitation, enhancement, etc.), the type of legal protection the 
mitigation site will have, the time it will take to restore lost 
functions, and when the mitigation will be performed.
                                 ______
                                 
           Questions Submitted by Senator Frank R. Lautenberg
    Question. I was pleased to see that the fiscal year 2013 budget 
includes $1 million for a study to find a long-term solution to chronic 
flooding in the Passaic River Basin. However, it will take at least 3 
years for construction to begin on a solution. How can the Corps 
expedite this project to ensure that families in the basin have flood 
protection as soon as possible?
    Answer. The Corps is currently realigning all feasibility studies 
to complete the most viable studies within 3 years. This process will 
expedite projects that are both likely to be found in the Federal 
interest and have strong sponsor support to be recommended for new 
start construction. The first phase of the Passaic River Basin study is 
designed to provide the non-Federal sponsor with an opportunity to 
determine alternative(s) on which to proceed to a Detailed Analysis 
Phase.
    Question. The budget requests funding for six new Army Corps 
studies. However, the budget does not include funding for several 
critical ongoing New Jersey studies, including the Rahway River Basin, 
the South River-Raritan River Basin, the Millstone River-Stony Brook 
and the Peckman River Basin projects.
    What criteria did the Army Corps use to determine which projects 
were included in the budget request? For all categories of project 
activity and budget accounts, please include specific factors as well 
as an explanation of how each factor influenced the decisionmaking 
process. If there was a benefit to cost-ratio threshold that had to be 
met, please indicate what that value was for each category.
    Answer. The four New Jersey studies, the Rahway River Basin, the 
South River-Raritan River Basin, the Millstone River-Stony Brook, and 
the Peckman River Basin are all flood risk management studies. The 
primary criteria that the Army used to determine which studies were 
included in the budget for the Flood Risk Management business line 
were:
  --study phase;
  --study completion date;
  --population at risk which is represented by the number of people 
        living, working and transient located in the study inundation 
        area for the design level recommended;
  --population affected by flooding which is the number of people 
        located in floodplain afforded risk reduction by the project at 
        the design level;
  --the flooding risk depth; and
  --benefit to cost ratio for preconstruction engineering and design 
        projects.
The Army also takes other factors into account, including the potential 
risk reduction, the environmental benefits to a community, and 
leveraging Corps resources to provide the highest return for the 
Nation.
    Question. What specific factors led to the decision to exclude the 
following New Jersey projects from the budget request: Rahway River 
Basin, South River-Raritan River Basin and the Stony Brook-Millstone 
River and the Peckman River Basin? Please include a detailed 
explanation for each project.
    Answer. While there are many worthwhile programs, projects, and 
activities nationwide, the fiscal year 2013 budget focused on the 
highest performing studies nationally. Each study was evaluated based 
on its performance, including public safety as well as economic and 
environmental benefits. The specific factors that led to the decisions 
to exclude the four New Jersey projects from the budget request are:
    Rahway River Basin, New Jersey.--The population at risk is 
approximately 23,000 people and the population affected by flooding is 
approximately 2,000 people. The flooding risk depth is 10 feet. This 
feasibility study was not included in the fiscal year 2013 budget due 
to low population affected by flooding relative to other competing 
needs elsewhere in the Nation.
    South River-Raritan River Basin, New Jersey.--The population at 
risk is approximately 146,000 people, and the population affected is 
approximately 21,000 people. The benefit to cost ratio for this project 
is 2.2 to 1. The flooding risk depth is 13 feet. This project was not 
included in the fiscal year 2013 budget due to low population affected 
by flooding relative to other competing needs elsewhere in the Nation 
and the benefit to cost ratio of 2.2 to 1 that would make this project 
a lower priority for consideration of future construction funding.
    Stony Brook, Millstone River Basin, New Jersey.--The population at 
risk is approximately 125,000 people and the population affected by 
flooding is approximately 5,000 people. The flooding risk depth is 9 
feet. This feasibility study was not included in the fiscal year 2013 
budget due to low population affected by flooding relative to other 
competing needs elsewhere in the Nation.
    Peckman River Basin, New Jersey.--The population at risk is 
approximately 265,000 people and the population affected by flooding is 
approximately 172,000 people. The flooding risk depth is 7 feet. This 
study was not included in the fiscal year 2013 budget due to the low 
population affected by flooding relative to other competing needs 
elsewhere in the Nation.
    Question. What specific factors led to the decision to include in 
the budget request only project monitoring funds for the Barnegat Inlet 
to Little Egg Harbor Inlet project and to exclude the Townsends Inlet 
to Cape May Inlet project? Please include a detailed explanation for 
each project.
    Answer. Both the Barnegat Inlet to Little Egg Harbor Inlet project 
and the Townsend Inlet to Cape May Inlet project were evaluated based 
on their performance, including contributions to public safety as well 
as economic and environmental benefits of each project. Barnegat Inlet 
to Little Egg Harbor Inlet was funded in fiscal year 2013 to continue 
project monitoring after construction. Construction funds for the 
Townsend Inlet to Cape May Inlet project were not included in the 
fiscal year 2013 budget due to the low benefit-cost ratio (BCR) (1.5 @ 
7 percent) and relative ranking to many other competing needs 
throughout the Nation.
    Question. I am pleased to see that the Corps has initiated a pilot 
program to decrease the time it takes to plan and study projects. What 
has the Corps learned to date from this pilot program? What are the 
next steps in this review? Can the Corps expand this effort to include 
a review of potential options to increase the pace of the complete 
lifecycle of projects, from initial study through the completion of 
construction?
    Answer. The National Pilot Program for Feasibility Studies was 
initiated in February 2011 to identify means to shorten the timeframe 
for pre-authorization study completion while retaining the quality of 
the analyses and decisions. The Pilot Program has affirmed that 
increased focus on the scope of each study leads to more effective 
decision documents and that early characterization of the risk 
associated with each study, and management of that risk, reduces 
uncertainty in the iterative planning process. No additional pilot 
studies are being proposed at this time as the intent is to now apply 
the lessons learned from these pilot studies to all active feasibility 
studies by fiscal year 2014. The Corps continues to develop and refine 
methodologies and processes for feasibility studies across all business 
lines in a manner that will be sustainable, replicable, and will inform 
future Civil Works guidance.
                                 ______
                                 
               Questions Submitted by Senator Jon Tester
              missouri river flood infrastructure recovery
    Question. The Corps has been spending down the emergency funding 
that was provided last year to rehabilitate damaged flood control 
structures following the flood of 2011. Brigadier General McMahon will 
want to review the progress of those repairs, the remaining work to be 
done, and the funding available. Of particular interest to Montana is 
the maintenance to the Fort Peck Dam. The area beneath the spillway was 
substantially washed out due to sustained record releases from the dam, 
which the Corp will need to address. In addition, of the three channels 
for releasing water from Fort Peck (powerhouse, spillway, and bypass 
tunnels) for several years, only two have been operable as the ring 
gates leading to the two bypass tunnels at Fort Peck have been 
inoperative. As the spillway will be out of commission during repairs, 
unless the ring gates are brought back online, the powerhouse will be 
the only apparatus for releasing water from Fort Peck. Doesn't prudence 
require repairs to the ring gates as an adjunct to the spillway 
repairs, and shouldn't that necessity allow emergency funds to be used 
for both projects?
    Answer. The Corps is finalizing design for the spillway repair, and 
the current solution allows for flexibility to operate the spillway up 
to the levels observed in 2011 (if necessary) during repair activities 
without substantial additional damages. As a result, while the ring 
gates will require repair in the future, the current repair of the 
spillway structure is not dependent upon a fully functional ring gate 
system. Since the ring gates were not damaged during the flood of 2011, 
repair of the ring gates is not, on its own, eligible for use of 
emergency supplemental funding.
                    yellowstone river corridor study
    Question. The Corps is in the process of funding a study of the 
cumulative effect of the Yellowstone River, in cooperation with the 
Yellowstone River Conservation District Council. The council has 
requested funds to complete the study by the end of 2015. This decision 
was prompted by members of the Technical Advisory Council who have been 
working on the study in some cases well past their retirement, but 
whose institutional memory is vital to the project. These members can 
not make an unlimited time commitment but have elected to see the 
project through to completion given that it does not extend past 2015. 
Will the Corps make every attempt to provide sufficient funds to 
complete the study by the Council's deadline?
    Answer. The Corps is working with the project sponsor, as well as 
the State and Federal agencies involved in the study, to define what 
can realistically be achieved by the Council's 2015 deadline. The 
fiscal year 2013 budget includes $200,000 for this study. This study 
will be considered, along with many other worthwhile programs, 
projects, and activities for the funding necessary in fiscal year 2014 
to complete a high quality study by the Council's 2015 deadline.
                missouri river authorized purposes study
    Question. For several years, a study has been conducting a 
comprehensive re-examination of the economic benefits of the various 
authorized purposes of the Missouri River. Recently, flooding on the 
Missouri has made the importance of completing this study even more 
apparent. However, at the urging of the House, last year's 
appropriations bill included a rider prohibiting any use of funds for 
Missouri River Authorized Purposes Study (MRAPS). At the same time, 
some members from the basin have advocated for legislative changes to 
the authorized purposes, even in the absence of the completed study. 
The prohibition on funds for the study was, to some degree, academic, 
because the Corps has not budgeted to advance the study in either the 
fiscal year 2012 or fiscal year 2013 budget request. How will the 
Corps, through budgeting and use of discretionary funds, advance the 
critical work of re-examining the way the management of the river has 
performed, and further inform the Congress as policy changes are 
contemplated?
    Answer. A limited amount of coordination may continue, as 
requested, utilizing unexpended carry over from fiscal year 2010, but 
the Corps is not expending any fiscal year 2012 funding to continue 
efforts on this study. The Army continues to evaluate each planning and 
construction project based on its individual merits, using the criteria 
applicable for that type of project and then to fund those projects and 
studies with the highest return to the Nation. This activity will 
continue to be considered along with many other worthwhile programs, 
projects, and activities competing for funds across the Nation.
                       intake dam rehabilitation
    Question. The Army Corps of Engineers is currently in the process 
of rehabilitating the irrigation diversion dam near Intake, Montana for 
passage of the pallid sturgeon. Since cost estimates for the original 
design skyrocketed to more than $100 million, USACE has been re-
evaluating alternatives. It is critically important that whatever 
alternative is selected function well to meet the needs of both the 
irrigators and the wildlife. The intake to the irrigation canal must 
function well despite the absence of the originally modeled rock ramp. 
Furthermore, the fish passage must function to facilitate sturgeon 
recovery on the river. What has been the Corps's process of engaging 
with stakeholders as this project advances, and can they assure the 
subcommittee that the selected alternative will serve the needs of the 
irrigators and the sturgeon?
    Answer. Phase I of this project to construct new headworks with 
fish screens is complete and currently operational. The structure will 
meet the full needs of irrigators for this irrigation season. The 
structure will also prevent annual entrainment of hundreds of thousands 
of native fish, including pallid sturgeon, into the irrigation canal. 
The existing dam crest, which has historically been maintained by the 
irrigation district to provide required flows into the canal, will 
continue to require maintenance to the required elevations. The rock 
ramp alternative would have required similar adjustment to the dam 
crest. Any future fish passage alternatives will continue to 
investigate the dam crest elevations within the overall project 
objectives to ensure the best opportunity for successful fish passage 
to include recovery of the pallid sturgeon.
    Reformulation and feasibility evaluation of fish passage 
alternatives has been undertaken by a multiagency partnership including 
the Corps, Reclamation, Fish and Wildlife Service, Montana Department 
of Fish Game and Parks, the U.S. Environmental Protection Agency, the 
Lower Yellowstone irrigation district, and others. All of the agencies 
that are engaged in the decisionmaking process for this project are 
focused on meeting the needs of the irrigation district, the 
requirements of the Endangered Species Act as it applies to the pallid 
sturgeon, and all other applicable State and Federal regulations.
    Regular engagement of the stakeholder agencies has been maintained 
throughout the design process via both face-to-face meetings and 
periodic teleconferences. A revised Environmental Assessment is 
currently under development and will have numerous levels of review to 
include Independent External Peer Review (IEPR), State and Federal 
agency reviews, and public review. Technical aspects of the project 
related to pallid sturgeon recovery are reviewed and approved by a 
multiagency Biological Review Team comprising some of the Nation's top 
experts on pallid sturgeon. All the above methods are aimed to ensure 
that the preferred alternative provides the best chance for successful 
pallid sturgeon recovery by utilizing the latest science available.
                        st. mary rehabilitation
    Question. The fiscal year 2010 appropriations bill included report 
language requesting that the Bureau of Reclamation combine National 
Environmental Policy Act compliance activities and preparation of 
design, specifications, and contract documents for the entire St. 
Mary's project including the diversion dam, fish passage structure, 
drop structures, siphon, and canal be combined as a single activity. 
What is the Bureau's timeline for completion of the Environmental 
Assessment that is currently being conducted on the St. Mary project?
    Answer. The Army is not in a position to provide schedules for the 
Bureau of Reclamations' program and recommends that the question be 
referred to the Bureau.
                            levee task force
    Question. The fiscal year 2012 Homeland Security Appropriations 
bill contained language requiring Army Corps of Engineers' to convene a 
task force to develop common standards for Federal Emergency Management 
Agency's (FEMA) levee certification studies and the Army Corps of 
Engineer's Levee Safety Program, such that the levee inspections 
performed by the Army Corps of Engineers may be used to satisfy FEMA's 
levee certification requirements. What is the progress of that task 
force, and when can the committee expect a report?
    Answer. The language in Public Law 112-74 requires FEMA ``to 
convene a task force with the Corps to better align NFIP levee 
accreditation requirements with levee inspections performed by or for 
the Corps such that information and data collected for either purpose 
can be used interchangeable to the maximum extent practicable toward 
satisfying levee accreditation requirements. FEMA shall provide a 
report to the Committee on the progress of this task force within 6 
months after the date of the enactment of this act.''
    FEMA has convened the task force and, while FEMA continues to have 
the lead, the Corps is an active participant on that task force. It is 
the intent of the task force to meet the time requirement for the 
progress report in the legislation.
                                 ______
                                 
             Questions Submitted by Senator Lamar Alexander
    Question. General Temple, it is my understanding that the Army 
Corps of Engineers (ACOE) owns more than 21,000 MW of power, and that a 
report put out by the ACOE indicates potentially enormous energy 
savings and a much lower carbon footprint for the U.S. Government if 
you modernize your existing hydropower assets.
    What is the ACOE doing on this issue?
    Answer. The Army is implementing a Hydropower Modernization 
Initiative (HMI) to address aging hydropower infrastructure issues for 
197 generating units representing 54 power plants that are not directly 
funded by the Department of Energy's Bonneville Power Administration. 
HMI was established to assess and prioritize investment needs and 
opportunities across the Army's hydropower assets, which include 
replacing turbines, generators, and other major generating components 
with modern equipment that can deliver better efficiency and additional 
generating capability. The John H. Kerr power plant modernization was 
completed in July 2011 adding 65 MW of additional capacity to the 
plant. The Webbers Falls, Ozark and Denison power plants are being 
modernized, which will improve operating efficiency and increase energy 
production by 57,000 MWh.
    Typically, when a hydroelectric power plant's generating unit is 
replaced or refurbished, efficiency improvements can range from 3 
percent to as high as 10 percent. If the Corps modernizes its top 20 
plants as identified in its Hydropower Modernization Initiative, 
efficiency gains on average would be 5 to 6 percent. This efficiency 
improvement represents a significant amount of additional renewal 
energy and avoided greenhouse gas emissions. For example, the initial 
assessment of prioritized equipment modernization and improvements in 
HMI would result in 830,000 MWh of additional renewable energy being 
produced. This amount of energy would avoid 630,000 tons of 
CO2 emissions into the atmosphere and serve 87,400 
additional American homes.
    Question. What would it take for the ACOE to modernize and upgrade 
its facilities to result in more clean-energy production?
    Answer. HMI study results show that an investment of approximately 
$4 billion over 20 years would improve reliability, restore design 
level efficiencies, and capture potential opportunities to improve and 
upgrade facilities.
                          olmsted lock and dam
    Question. Secretary Darcy, buried within the Administration's 
budget request is a legislative proposal to increase the total project 
cost of the Olmsted project to roughly $3 billion. That is an increase 
of nearly $1 billion since you last reported to this subcommittee.
    What has caused this spike in costs?
    Answer. The Olmsted cost increase to $2.918 million (October 2011 
price levels) is attributed primarily to a low initial estimate, which 
increased substantially in light of construction and contractual 
complexities associated with the innovative ``in-the-wet'' construction 
technique. This method also lengthened the duration of construction 
which pushed costs into an unanticipated period of higher than average 
inflation associated with building materials utilized for construction.
    There are several factors that have contributed to the low initial 
cost estimate for the innovative ``in-the-wet'' construction technique. 
Unknown factors when the project was authorized include the negative 
impacts on productivity due to river conditions (elevation and 
velocities) and the complexity of shell fabrication necessitated by the 
seismic condition at the site. After constructing and setting the first 
set of shells in 2010, the government and contractor realized that the 
effort associated with fabrication and setting these large pieces of 
precast concrete and filing them with tremie concrete was not like any 
work they had previously experienced or previously had estimated. The 
construction challenges associated with developing this innovative 
method of construction have been overcome, but required a lot more 
effort than was originally envisioned. Roughly 77 percent of the 
increase in the estimated total cost of the project, in real terms, 
(above inflation), is associated with the increase in the cost of 
constructing the dam.
    Question. Has an outside review of the cost, construction method, 
and schedule been performed?
    Answer. The Corps conducted an Independent External Peer Review of 
the Post Authorization Change Report, which concurred with the revised 
cost estimate. The schedule went through and Agency Technical Review 
but was not reviewed externally. The project is currently undergoing an 
internal review of the methodology of construction for the dam (``in-
the-wet'' versus cofferdams) and the management controls in place for 
the cost-reimbursable contract.
    Question. How much confidence should we have that this estimate 
reflects the ultimate cost of this project?
    Answer. The cost estimate was developed using a variety of 
estimating methodologies by a diverse team of experienced U.S. Army 
Corps of Engineers (USACE) cost engineers and Hill International 
professional cost engineers and schedulers. A cost and schedule risk 
analysis was performed to establish the 80-percent confidence level for 
both cost and schedule. Quality control and quality assurance reviews 
were performed at various levels of product development. The Corps Cost 
Engineering Center of Expertise reviewed and certified the project cost 
and schedule estimates on November 9, 2011, confirming that the 
estimates and schedules were prepared in accordance with clearly 
established professional principles, practices, codes, and criteria.
    Question. What is the projected completion of the project?
    Answer. The schedule in the Post Authorization Change Report 
assumes that the Corps will spend an average of about $150 million per 
year on this project, consistent with recent funding levels and 
reflecting the level of receipts to the Inland Waterways Trust Fund 
(IWTF) under current law. Based on that assumption, the report 
estimates that the Olmsted Locks and Dam part of the project will 
become operational in fiscal year 2020, based on the minimal project 
features required for the dam to hold the pool and pass navigation 
through the locks. Physical completion for the dam contract is 
projected to be in fiscal year 2021, including contractor de-
mobilization and equipment salvage. The remainder of the work, 
including other required facilities, buildings and grounds, river 
dikes, demolition of Locks and Dams 52 and 53 and permanent operating 
equipment is projected to be finished in fiscal year 2024, thus 
completing the project.
    Question. What is your confidence in this time and cost estimate?
    Answer. The cost estimate was developed using a variety of 
estimating methodologies by a diverse team of experienced USACE cost 
engineers and Hill International professional cost engineers and 
schedulers. A cost and schedule risk analysis was performed to 
establish the 80-percent confidence level for both cost and schedule. 
Quality control and quality assurance reviews were performed at various 
levels of product development. The Corps Cost Engineering Center of 
Expertise certified the project cost and schedule estimates on November 
9, 2011.
    Question. Have you considered changing construction methods to a 
more traditional construction method?
    Answer. The Corps has assembled a team of experts to consider 
alternative construction techniques. The team is developing a concept 
level design for ``in-the-dry'' construction to a degree that can be 
used to prepare a reliable cost estimate and schedule suitable for 
comparison to the ongoing ``in-the-wet'' construction for the navigable 
pass portion of the dam. The Corps will evaluate the team's 
recommendation based on the concept level design and certified cost 
estimate by the summer 2012 to determine the most cost effective way to 
complete construction.
    Question. Do you believe it might be prudent to consider a pause in 
this construction project in order for the Corps to re-evaluate the 
plan to complete this project in light of the cost increase?
    Answer. The Corps is still evaluating which method to use to 
construct a portion of the Olmsted Dam and the timeframe for completing 
construction of the overall project.
                      inland waterways trust fund
    Question. Secretary Darcy, as you know I represent a State with an 
extensive inland waterway system with several of our aging locks and 
dams. I am concerned that the Administration continues to not address 
enhancing the revenues of the Inland Waterways Trust Fund (IWTF). Your 
announcement of the $1 billion cost increase on Olmsted Locks and Dam 
would seem to make finding a solution more urgent than ever.
    It is my understanding that the current 20 cent per gallon fuel tax 
raises about $75-80 million annually. Is that correct?
    Answer. Fuel tax revenues in fiscal year 2010 and fiscal year 2011 
were approximately $74 million and $84 million, respectively. The 
projected revenues from the existing diesel fuel tax are expected to 
increase to approximately $92 million in fiscal year 2012 and $95 
million in fiscal year 2013.
    Question. With the projected funding needs for Olmsted over this 
time period, what else will the Corps likely be able to do to address 
the needs of this aging inland waterway system?
    Answer. In addition to providing $144 million for Olmsted, the 
fiscal year 2013 budget provides for completing major rehabilitation of 
Lock and Dam 27 on the Mississippi River and Lockport Lock and Dam on 
the Illinois Waterway, and continuing some funding for the Lower 
Monongahela River Locks and Dams 2, 3, and 4 project. Based on 
projected revenues from the current fuel tax, if Olmsted Locks and Dam 
is provided approximately $150 million annually, with $75 million 
funded from the IWTF, approximately $40 million to $45 million per year 
(depending upon the level of actual IWTF receipts) would be available 
annually for other IWTF cost-shared projects for several more years. 
One-half of those funds would come from the general fund of the 
Treasury; the other one-half would come from the IWTF. This highlights 
the importance of enacting a long-term mechanism to increase receipts 
to the IWTF.
    Question. Would you agree that simply raising the fuel tax, at best 
is a band-aid solution to the long-term funding issues of the Inland 
Waterways System?
    Answer. Yes, we do not favor that approach. The Administration 
submitted a vessel user fee proposal in September 2011, which if 
enacted in addition to the existing level of revenue from the fuel tax, 
as proposed, would raise sufficient revenues to finance needed 
construction. To enact an increase in the fuel tax substantial enough 
to provide the same level of revenues would require more than doubling 
the current fuel tax.
    Question. It would seem to me that what we need is an entirely new 
way to finance the Trust Fund. Has the Administration given any thought 
to an entirely new way to realistically fund this system? For the 
Harbor Maintenance Trust Fund every imported item contributes to the 
maintenance fund. Wouldn't a similar funding mechanism for inland 
waterways provide a more robust funding sources as well as inflation 
protection?
    Answer. The budget proposes an equitable way to finance the non-
Federal share of this investment, which is the responsibility of the 
commercial users of these waterways under current law. In September 
2011, as part of the President's Jobs bill proposal, the Administration 
submitted a legislative proposal to the Congress to reform the laws 
governing the IWTF. The proposal would provide an additional source of 
financing for major new investments in the inland waterways to support 
economic growth. It includes a new vessel user fee, which, if enacted, 
would supplement the revenue collected from the fuel tax, and would 
increase the total paid by commercial navigation users sufficiently to 
meet their share of the costs of activities financed from the IWTF. The 
proposal has a provision to prevent the IWTF from accumulating too much 
revenue and from being depleted. It has the potential to raise an 
additional $1.1 billion in additional revenue from the users over 10 
years.
    Question. Has any consideration been given to changing the cost 
sharing on Olmsted from the current 50/50 to something else such as 75 
percent from the Treasury and 25 percent from the IWTF?
    Answer. We do not favor that approach. The Olmsted Locks and Dam 
project should continue to be funded as provided in current law, under 
which requires construction is to be funded one-half from amounts 
appropriated from the general fund of the Treasury and one-half from 
amounts appropriated from the IWTF.
    Question. Is the legislative proposal the same as proposed last 
year in the President's deficit reduction package?
    Answer. The legislative proposal to reform the laws governing the 
IWTF is the legislative proposal President Obama transmitted to the 
Congress in September 2011, as part of his Jobs bill proposal. It would 
provide an additional source of financing for major new investments in 
the inland waterways to support economic growth.
    Question. As I recall that proposal allowed the Assistant Secretary 
to raise fees as necessary to provide additional funds as well as 
continuing the current diesel tax?
    Answer. Correct. The diesel fuel tax would continue to be assessed 
at the current rate of $0.20 per gallon, although the diesel fuel tax 
would be assessed on the existing 27 inland and intracoastal waterways 
as well as an additional 40 waterways that are not subject to the 
current tax, and the Secretary of the Army would set the rates for new 
vessel user fees on all 67 of the inland and intracoastal waterways.
    Question. Do you know what these fees might consist of?
    Answer. The legislation would impose a flat annual user fee on each 
vessel that transports commercial cargo on the inland waterways of the 
United States, which would be paid by the owner of the vessel. The 
Secretary of the Army would determine the amount and structure of the 
fee each fiscal year, with the goal of ensuring that the balance of 
receipts in the IWTF is sufficient to cover the user-financed share of 
the costs of inland waterways capital investment.
    Question. Why are these additional revenues targeted for deficit 
reduction rather than for improving or replacing the aging 
infrastructure of the inland waterways system?
    Answer. The proposal is not for the purpose of deficit reduction. 
The revenues would enable an increase in investments in construction 
and rehabilitation of inland waterways infrastructure.
    Question. Have you been given any indication that legislation 
allowing fee increases is being considered in the House or Senate?
    Answer. No, although there are bills that would increase the fuel 
tax.
                 flood control and coastal emergencies
    Question. Can you update us on the progress you are making on 
repair flood and storm damages from the $1.7 billion that we 
appropriated in December?
    Answer. The Corps is tracking progress on the Class I, II, and IIIB 
repairs. The classes are defined as follows:
  --Class I is Urgent and Compelling (Unsafe).--Heavily damaged 
        projects that have breached or failed where there is a probable 
        loss of life.
  --Class II is Urgent (Potentially Unsafe).--Damaged projects that are 
        likely to fail where there is a probable loss of life and 
        economic damage.
  --Classes IIIA and IIIB are High Priority, including:
    --Class IIIB (Conditionally Unsafe).--Damaged systems that are 
            likely to fail where there is a potential for economic, 
            environmental, and an indirect potential for loss of life.
    --Class IIIA (High Impact to Navigation).--Damaged systems directly 
            impacting high use navigation.
  --Class IV: Priority (Marginally Safe).--All other damaged systems 
        not meeting Class I, II, or III above.
    The Corps has made significant progress toward completing priority 
repairs. The Corps identified 11 Class I (urgent and compelling) 
projects and expects to complete interim protection for 10 projects by 
March 31, 2012. Full completion is expected (pre-event conditions 
restored) by March 31, 2013. There is one Class I project that 
anticipates completion by March 31, 2014. Similarly, the Corps 
identified 31 Class II (urgent) projects and expects completion of 
interim protection for 14 projects by March 31, 2012. Full completion 
is expected by March 31, 2013. Fourteen Class II repairs are 
anticipated to be complete by March 31, 2014, and three repairs expect 
completion after March 31, 2014. The Corps identified 31 Class IIIB 
(conditionally unsafe) projects and expects completion of interim 
protection for 19 projects by March 31, 2012. Full completion is 
expected by March 31, 2013. Twelve Class IIIB repairs are anticipated 
to complete by March 31.
    Question. Will these funds allow you to make all of the necessary 
repairs to return these flood control structures to pre-disaster 
conditions?
    Answer. A small portion of the costs of damage repairs is not 
covered by Presidential declarations and, therefore, not eligible for 
disaster relief funding. The funds will allow the Corps to make all 
critical repairs in areas that are covered by Presidential 
declarations.
    Question. If not, are you budgeting for the necessary repairs 
through regular appropriations?
    Answer. Many of the noncovered repairs from the 2011 floods 
successfully competed for fiscal year 2012 or fiscal year 2013 funding. 
Only lower priority repairs, which did not compete successfully, have 
been deferred and will be considered during formulation of the 
President's fiscal year 2014 budget.
    Question. Will the flood control infrastructure on the Mississippi 
and Missouri Rivers, be able to provide protection from the high-water 
events expected this year?
    Answer. Yes, Corps-owned infrastructure on the Mississippi and 
Missouri Rivers impacted by the 2011 Mississippi and Missouri River 
flood is operational at this time and will be able to provide 
acceptable level of interim protection from potential high water events 
that take place during the upcoming flood season. Along the Mississippi 
River interim repairs were initiated in several critical areas 
including Birds-Point New Madrid (BP-NM), Presidents Island and 
Meriwether-Cherokee to withstand possible high water in 2012. Permanent 
repairs in the BP-NM Floodway area are scheduled either complete by the 
2013 flood season or to a level sufficient to provide protection from 
an event similar to the 2011 flood and are still needed to ensure 
future operational safety and reliability. Damage assessments continue 
and additional required repairs may be identified.
    In the lower Missouri Basin between Omaha and Kansas City 
Districts, repairs to the levee systems are in progress. Currently 
closure of breaches on 10 of the 13 systems has been accomplished. As 
we move into their flood season, traditionally late May through early 
July, we anticipate all breaches being closed. Any remaining 
vulnerabilities will be addressed through flood fighting, with on-site 
contractors available should that need arise.
    Work to restore levees to their pre-2011 flood condition continues 
and is expected to complete on the Mississippi River Levees within a 3-
year time-frame. Damage assessments continue and additional required 
repairs may be identified.
    Question. How long do you project that it will take to restore 
these flood control structures to pre-flood conditions?
    Answer. By March 31, 2014, 96 percent of the highest priority 
repairs are scheduled to be restored to pre-flood conditions.
                       principles and guidelines
    Question. In fiscal years 2011 and 2012, the budget request 
proposed a new line item to prepare guidance for the revised Principles 
and Guidelines (P&G). It was not funded by the Congress in either year 
and the Congress directed that the current Principles and Guidelines 
should be used for fiscal year 2012. I note that this line is missing 
from your request for fiscal year 2013. Are the revisions of the P&G 
still going forward?
    Answer. Yes. The Council for Environmental Quality (CEQ) leads the 
Administration's process of modernizing the 1983 P&G for Water 
Resources Planning.
    Question. Are you aware of whether the Administration plans to 
release the revised P&G in fiscal year 2013?
    Answer. The product of the first step in that revision process--
called the Principles and Requirements--is currently under review 
within the Administration. Agency guidelines would be developed 
following the release of the final Principles and Requirements.
    Question. Will the Corps still need new guidance to implement the 
revised Principles and Guidelines in fiscal year 2013?
    Answer. Yes. CEQ is expected to direct agencies to develop their 
own procedures to conform to the interagency procedures (guidelines). 
Within the Corps, ER 1105-2-100 (known as the Planning Guidance 
Notebook) will need to be updated to incorporate new policies and 
procedures to reflect the revised principles and guidelines.
    Question. Without this specific line item, how does the Corps plan 
to fund the guidance that needs to be prepared?
    Answer. The budget includes funding under the Planning Support 
Program for updating planning guidance in general, a portion of which 
would be used to fund the guidance that needs to be prepared to reflect 
the revised principles and guidelines.
                           regulatory program
    Question. The budget request proposes $205 million for the 
Regulatory Program. That is an increase of $12 million or nearly 7 
percent, over the fiscal year 2012 amount. As I recall, this program 
was funded at $189.6 million in fiscal year 2011, which is the last 
fiscal year that is completed. How many permits did the Corps issue in 
fiscal year 2011?
    Answer. In fiscal year 2011, the Corps issued approximately 56,000 
permits. In addition, the Corps finalized approximately 26,000 other 
regulatory actions in fiscal year 2011 and more than 58,000 
Jurisdictional Determinations.
    Question. For fiscal year 2012, the Congress provided $193 million 
for this program. Are you able to process permits in a timely manner in 
fiscal year 2012?
    Answer. Yes. Our data indicate that we are able to process the 
majority of applications in a timely manner. We have established 
national performance goals for processing time for both general permits 
and individual permits, based on anticipated funding levels. The fiscal 
year 2012 goal for General Permits (GP) is to process 75 percent of all 
GP in 60 days or less. The fiscal year 2012 goal for Individual Permits 
is to process 50 percent of these actions in 120 days or less. There is 
regional variance in performance, although thus far in fiscal year 2012 
the Corps is meeting or exceeding these goals on a national basis.
    Program performance data over the past 5 years shows a direct 
correlation between funding levels and performance: the more funding is 
received, the higher the level of performance is achieved. In most 
years, most performance targets are met nationally because the goals 
are tied to funding levels. Other program funding factors, such as 
increasing complexity, increased costs of litigation, and the need for 
technology and science to inform decisionmaking are not reflected in 
performance goal targets.
    The program strives to deliver excellent customer service while 
providing legally defensible decisions based in sound science as 
expeditiously as possible. An increase is proposed in fiscal year 2013 
to provide additional funds to Districts to sustain on-board staff, 
which will support increased performance and thereby increase the 
number of permit actions and associated program activities (e.g. 
mitigation site evaluations, compliance visits) completed by District 
staff. For the past years, funding increases have not kept up with 
increases in indirect expenses (rent, vehicle costs, etc.). Additional 
funds are needed to support existing staffing levels. The same or less 
funds will mean a decrease in full-time equivalents (FTEs), affecting 
permit review times and the number of jurisdictional determinations, 
permit evaluations, mitigation reviews, and compliance visits that can 
be completed.
    Question. What is the average length of time for the processing of 
your permits?
    Answer. The length of time to process an application depends on the 
type of permit requested and the complexity of the proposed action. 
Individual permit involve a public notice and agency coordination, are 
generally more complex, and are sometimes more controversial than 
activities that may be authorized by GP. In contrast, GP may require 
agency coordination but do not require a public notice and may only 
authorize projects that result in minimal adverse impacts to aquatic 
resources. To date, in fiscal year 2012, the average time to process an 
IP was 139 days and 28 days for a GP.
    Question. Are you anticipating a significant increase in permitting 
activities in fiscal year 2013 or is an increase in staffing driving 
this cost increase?
    Answer. The Army anticipates an increase in applications/decisions, 
jurisdictional determinations, agency coordination, and consultations, 
and other complex workload actions in fiscal year 2013. Staffing levels 
in fiscal year 2013 are anticipated to remain approximately equal or 
slightly decline from the current staffing levels in fiscal year 2012. 
Workload complexity is increasing as evidenced by a substantial 
increase in the number of projects requiring Environmental Impact 
Statements, projects requiring robust interagency coordination to 
include a marked increase in Endangered Species Act consultations. A 
10-percent increase was noted above fiscal year 2011 levels in the 
total number of permit activities evaluated by USACE Districts.
                     harbor maintenance trust fund
    Question. The budget request for fiscal year 2013 anticipates $848 
million to be contributed by the Harbor Maintenance Trust Fund for 
maintaining eligible harbors and waterways. That is a $90 million 
increase over what was proposed in the fiscal year 2012 budget. That is 
a good trend. Does this meet the needs of all of the eligible ports and 
waterways for the required maintenance?
    Answer. The budget amount of $848 million for Harbor Maintenance 
Trust Fund eligible projects reflects an appropriate amount for 
operation and maintenance of the Nation's coastal harbors and channels 
for fiscal year 2013.
    Question. How much additional funding would be required to maintain 
eligible ports and waterways to their authorized requirements?
    Answer. The cost to dredge and maintain eligible coastal harbors 
and channels to their authorized depths and widths is estimated at 
approximately $1.35 billion per year for high and moderate commercial 
use projects and an additional $0.5 billion per year for low commercial 
use coastal projects.
    Question. How many of the ports and waterways that you elected not 
to fund have not been proposed for funding in the previous 5 years in 
an administration budget?
    Answer. A total of 832 coastal navigation projects have not been 
proposed for funding in the last six budgets (from fiscal year 2008 
through fiscal year 2013).
    Question. Were these projects economically justified at the time of 
their authorization and construction?
    Answer. The majority of them were probably viewed as economically 
justified according to the laws and policies at the time of their 
authorization and construction, which may have been many decades ago.
    Question. Was the maintenance of the projects over their 50-year 
economic life factored into that economic analysis?
    Answer. Corps navigation studies typically evaluate project 
maintenance over a 50-year timeframe.
    Question. If these ports are meeting the tonnage projections in the 
studies for which they were analyzed and authorized wouldn't it follow 
that maintaining them would have a positive net impact on the national 
economy?
    Answer. Not necessarily. For example, the quality of the analysis 
has improved since many of these projects were authorized, and also 
varies from project to project. Even for a project that is meeting the 
tonnage projections from the project studies, the type of commodities 
and use of the project may have changed considerably since project 
construction. Operation, maintenance, and rehabilitation costs may also 
be higher than projected.
    Question. Then how are we not funding these projects?
    Answer. The allocation of funds considers the economic and safety 
return on investment, in comparison with other potential uses of the 
available funds throughout the Corps Civil Works mission areas, as well 
as the need to reduce the Federal deficit.
    Question. If the Administration has no intention of funding these 
in the future due to the economics of the projects, wouldn't it be 
appropriate for the Administration to propose that these projects be 
deauthorized rather than ignoring this Federal obligation year in and 
year out?
    Answer. The fiscal year 2013 budget is performance based. The 
condition of projects changes over time and projects that do not 
compete well in some years may compete better in the future. Projects 
with little or no Federal interest can be proposed for deauthorization.
                                 ______
                                 
              Questions Submitted by Senator Thad Cochran
    Question. The President's fiscal year 2013 budget request shows a 
decrease in funding for nearly every important Civil Works account: 
Construction, Operation and Maintenance, Mississippi River and 
Tributaries, and Investigations. However, there is a funding increase 
for the Corps Regulatory Program for operational oversight and 
management. It concerns me that the Administration is increasing your 
ability to impose regulations but decreasing your ability to perform 
vital functions such as maintenance dredging and flood protection. Can 
you explain this concerning trend?
    Answer. In comparison to the fiscal year 2012 budget, the fiscal 
year 2013 budget includes increased funding for operation and 
maintenance, Mississippi River and Tributaries, Regulatory, and 
Emergency Management. The budget is performance-based and focuses on 
those investments that will yield high economic and environmental 
returns to the Nation or address a significant risk to public safety 
and the environment, as appropriate, within the bounds of our statutory 
authorities.
    Question. I understand that the reimbursement from the Harbor 
Maintenance Trust Fund (HMTF) needs to be around $1.3 to $1.6 billion 
annually to meet the basic maintenance dredging needs in the Corps' 
maintenance inventory. What percentage of Harbor Maintenance Trust 
revenue is actually allocated towards harbor operation and maintenance 
costs each year?
    Answer. Approximately 50 percent to 60 percent of HMTF receipts 
have been allocated toward harbor operation and maintenance costs since 
fiscal year 2007. The fiscal year 2013 budget increased funding for 
harbor maintenance and related work by $90 million, which is almost 12-
percent above the level proposed in the fiscal year 2012 budget.
    Question. Are the Administration and the Corps of Engineers 
considering ways to maximize use of the HMTF to address the critical 
needs of ports that must be dredged and deepened in preparation for the 
Panama Canal expansion?
    Answer. The fiscal year 2013 budget allocated Civil Works funding 
based on performance. For activities funded from the HMTF the Corps 
uses performance criteria that focus on the economic and safety return 
from the investment in harbor maintenance and related work. In 
addition, the fiscal year 2013 budget gives priority to funding studies 
or preconstruction engineering and design for several proposed projects 
that would enable a port to accommodate larger vessels, which could 
transit the deepened Panama Canal, such as Boston Harbor, Brazos Island 
Harbor, Charleston Harbor, Houston Ship Chanel, Jacksonville Harbor, 
Savannah Harbor, and Wilmington Harbor; and also funds construction of 
ports such as New York and New Jersey.
    Question. There has been discussion of the needs of ports located 
on the east and west coasts. Is the Corps fully cognizant of the needs 
and the significance of our Nation's ports located in the Gulf of 
Mexico as they relate to the Panama Canal expansion?
    Answer. The Army is aware of the significance and needs of the gulf 
coast ports. The budget includes funding for deepening studies for both 
Brazos Island Harbor and the Houston Ship Channel.
                                 ______
                                 
              Questions Submitted by Senator Susan Collins
    Question. Assistant Secretary Darcy, for any direct impacts to 
jurisdictional wetlands, the Corps' New England District has published 
``guidelines'' for compensatory mitigation. In the case of permanent 
preservation, those guidelines call for a mitigation ratio of at least 
15:1. For some projects, this ratio is increased to 20:1, or even 25:1, 
based upon the discretionary application of the permit writers 
valuation of functions and values. Under the State of Maine's law, the 
mitigation ratio for preservation is 10:1.
    Under the Corps ``guidelines,'' if one acre of wetland area is 
impacted for a project, the Corps has required up to 25 acres to be 
permanently protected. This adds significant costs to potential 
projects that are key to our economic recovery.
    For one project in Western Maine, a constituent sought to reduce 
the wetland impact for a project that had been previously approved by 
the Corps under its prior mitigation ratios. However, due to the new 
higher mitigation ratios, and the requirement of both preservation and 
in-lieu fees, the project has not gone forward. It is my understanding 
that the wetland impacts would have actually been reduced, but that 
still the Corps was asking for greater mitigation.
    Does the Corps plan to review and revise its wetland mitigation 
guidelines, particularly in the New England District, so that well-
designed and appropriately sited projects that would reduce wetland 
impacts are encouraged?
    Answer. As a general requirement, in accordance with section 404 of 
the Clean Water Act (CWA), an activity's impacts to waters of the 
United States must be first avoided, then minimized, and lastly 
compensated. Therefore, by nature of the law, projects that would 
reduce wetland impacts are already encouraged.
    The New England District's guidance has, for many years, 
recommended a 15:1 ratio for preservation, although this ratio may be 
lower or higher, depending on the functions of the wetland being 
impacted as well as the ecological value of the proposed preservation. 
The guidance is not binding and may be updated as necessary in the 
future based upon new policy, guidance, or science. The New England 
District works with applicants to avoid and minimize impacts to waters 
of the United States, consistent with the requirements in the Corps 
regulations. When projects result in less impact to aquatic resources, 
mitigation requirements may be substantially reduced.
    Question. Assistant Secretary Darcy, there remains a great need in 
my State and others around the Nation when it comes to the dredging and 
maintenance needs at our small ports and harbors. Without the ability 
to direct funding to such activity, I believe we need to pay careful 
attention to ensure the water infrastructure needs of all States are 
met.
    I am pleased to see $13 million included in the budget request for 
the dredging of Portland Harbor. Portland Harbor is the largest 
commercial port in Maine and it is one of the largest in New England. 
In 2009, the direct economic impact of Portland Harbor was estimated to 
be 3,668 jobs, $101 million in wages, and $209 million to the Gross 
State Product. An additional $142 million of economic impact extended 
beyond the immediate confines the harbor. This economic impact makes 
the maintenance dredging of the Federal Navigation Channel critically 
important.
    I would also like to highlight the $30 million for operations and 
maintenance projects at ``small, remote, or subsistence navigation'' 
harbors and waterways that was included in the fiscal year 2012 enacted 
bill. This funding made a small project in Wells Harbor, Maine, 
possible, but many others in my State are still in need of funding.
    What funding is proposed under the fiscal year 2013 budget request 
to meet the dredging and maintenance needs of the Nation's small ports 
and harbors? How do you respond to concerns that the Nation's smaller 
ports and harbors may be disadvantaged under the current Corps' cost-
benefit metrics?
    Answer. The President's fiscal year 2013 budget includes $40 
million for low commercial use coastal ports and harbors. The Army 
focuses first on funding those projects that provide the greatest 
economic and safety return on investment to the Nation. For ports and 
harbors with a low level of commercial use, the Army also considers a 
range of factors such as whether the harbor is a critical harbor of 
refuge or a subsistence harbor, or supports public transportation, U.S. 
Coast Guard search and rescue operations, the national defense, or 
other Federal agency use; the reliance on marine transportation for 
energy generation or home heating oil deliveries, and the level of 
commercial use (albeit less than a medium level of commercial use).
                                 ______
                                 
             Questions Submitted to Hon. Michael L. Connor
            Questions Submitted by Senator Dianne Feinstein
                             water banking
    Question. Does Bureau of Reclamation (BOR) need additional 
flexibility on water banking to better manage water resources in the 
West?
    Answer. BOR has authority for participation in water banks pursuant 
to section 101(d) of the Reclamation States Emergency Drought Relief 
Act of 1991 (Public Law 102-250, as amended). However, that authority 
is contingent upon Governors of the affected State or on a reservation 
making a request for temporary drought assistance and the Secretary of 
the Interior determining that assistance is merited, or upon the 
approval of a drought contingency plan. BOR was given additional 
specific authority to participate in water banks in the 2012 
Consolidated Appropriations Act in the State of California. This 
authority enhanced water management flexibility. In particular, the act 
allows BOR to buy interests in water bank facilities and to pay water 
banking fees with Central Valley Project (CVP) water. BOR and the State 
of California are satisfied with the authorization, but note that it 
expires with the act at the end of the fiscal year. Our Lower Colorado 
(LC) Region has existing authority to participate in existing State 
water banking programs, and has issued its own regulations to 
correspond with water banking agreements among its States. It is 
unclear at this point if the same authority would be useful in other 
BOR regions or States.
    Question. Is additional legislation needed to provide this 
flexibility?
    Answer. It is unclear what additional authority might be needed 
across BOR and would depend on the extent of activity desired of BOR by 
the Congress in relation to water banks. The Mid-Pacific (MP) Region 
expects to use the authority enacted in 2012 for California and further 
legislation would be needed to extend it. Further determinations are 
needed to understand what authority exists, and therefore, what more 
authority would be needed, in the regions other than MP and LC. Our 
preliminary research indicates that BOR may lack authority to buy 
interests in water banks in other States.
    Question. What impact does tiered pricing have on the agricultural 
water service contractors?
    Answer. Depending on how a tiered pricing program's rates are 
structured, tiered pricing may provide an incentive to use water more 
efficiently, i.e., to use less water for crop practices that provide a 
lower net return compared to those crops and practices with a higher 
net return. This incentive is based on the concept that a direct 
relationship exists between the amount of irrigation water delivered to 
the farm and the amount the farmer pays for that water. The primary 
determinant of the effectiveness of tiered pricing is the change in the 
amount demanded relative to a change in the price (or price elasticity 
of demand). A rate structure that encourages conservation must 
effectively communicate the price of water at different levels of use 
to users. However, if changes in price do not result in corresponding 
changes to demand, a tiered pricing program will have a relatively 
small impact on conservation. There are a number of factors and 
conditions that may influence a tiered pricing program's impact on 
irrigators. Some of these include:
  --the actual structure of the tiered pricing program;
  --the efficiencies of existing water management practices;
  --the cost of adopting new water technologies;
  --the quantity of available water supplies versus the quantity 
        demanded based on existing (and projected) cropping patterns; 
        and
  --the value of irrigated crops produced, as well as the potential for 
        dryland crop production.
    In the CVP, tiered pricing provisions of the Central Valley Project 
Improvement Act (CVPIA) are triggered when a water service contractor 
takes more than 80 percent of its total contract entitlement. Thus, in 
dry years when allocations are below 80 percent, CVPIA tiered pricing 
provisions do not apply. In addition, contracting actions for 
settlement contractors, interim contracts, and section 215 water, 
(which is considered to be outside of the contractor's own water 
allocation) is not subject to tiered pricing. Consequently, contractors 
that have the ability to receive additional water through transfers may 
be able to circumvent any potential conservation intended through the 
implementation of CVPIA tiered pricing.
    One potential means of estimating the impact of CVPIA tiered 
pricing provisions to CVP water service contractors is to examine the 
amount of revenues collected through the application of tiered pricing 
provisions. BOR prepares and submits an annual financial report to the 
Senate Committee on Energy and Natural Resources, the Senate Committee 
on Appropriations, the House Committee on Natural Resources, and the 
House Committee on Appropriations describing CVP Restoration Fund 
revenues (receipts) and expenditures (uses). Revenues received from 
CVPIA tiered pricing provisions amounted to $327,067 in fiscal year 
2010. This was less than 3 percent of nondiscretionary CVP Restoration 
Fund revenues ($11,132,008) and less than 0.7 percent of total CVP 
Restoration Fund revenues ($47,968,797) received in fiscal year 2010. 
The fact that the application of tiered pricing results in such a small 
percentage of total CVP Restoration Fund revenues suggests that CVPIA 
tiered pricing provisions likely have a relatively small financial 
impact on water users. However, determining whether tiered pricing 
encouraged or discouraged water conservation efforts in fiscal year 
2010 is less clear.
    Question. Do you believe that tiered pricing encourages or 
discourages conservation among contractors?
    Answer. In general, charging higher rates for additional water 
tends to encourage conservation practices by water users (assuming 
water can legally be treated as a commodity and deliveries can be 
measured). However, irrigator response to a tiered pricing program is 
dependent on the factors listed above--with the primary determinant 
being how the tiers are structured.
    CVP contractors located south of the Sacramento-San Joaquin Delta 
receive, on average, about 66 percent of their contractual amounts. As 
a result, the tiered pricing provisions of CVPIA generally have limited 
impact on these contractors in terms of conserving water.
    Question. What about in dry years?
    Answer. Generally, we would expect the effects of a tiered pricing 
program, in and of itself, to have less of an effect in encouraging 
conservation among irrigators during short-term, intermittent periods 
of water shortages, primarily because the higher priced tiers would not 
be triggered with a reduced water supply. However, as indicated above, 
additional factors might cause irrigators to respond in unanticipated 
ways.
    As indicated above, the tiered pricing provisions of CVPIA do not 
take effect until contractors take more than 80 percent of their total 
contract entitlement. Thus, in dry years the higher tiered prices of 
CVPIA will not apply.
             central valley project and state water project
    Question. How can BOR and the State Water Project (SWP) in 
California better improve their coordination so as to improve water 
supply reliability for both systems?
    Answer. The CVP operators and the SWP operators are co-located and 
closely coordinate the operations of both projects. The Delta Mendota 
Canal (Federal)--California Aqueduct (State) Intertie will be 
operational this summer to improve water supply reliability.
                             sierra nevadas
    Question. Do you believe there could be potential water salvage 
benefits from better forest management practices in the forests of the 
Sierra Nevadas?
    Answer. Potential water salvage through restoration activities that 
improve water quality and quantity varies due to the distribution along 
the Sierra Nevada Mountains of precipitation, forest types, land 
designations, multiple-use management arrangements, and laws, 
regulations, and policies. In general, restoration activities on Sierra 
Nevada National Forest Service (NFS) forests and wet meadows improve 
water quality, water quantity, and streamflow regimens with the overall 
effect of improving California's water supplies. Restoration activities 
on these lands can protect water sources from degradation, as well as 
improve the capacity of our NFS lands to retain, filter, and release 
water during low-flow periods when it is needed the most.
    Question. Do you have any suggestions as to how to determine if 
this could result in significant water savings?
    Answer. In December 2009, six Federal agencies, including the U.S. 
Department of Agriculture (USDA), issued an Interim Federal Action Plan 
for the San Francisco Bay/Sacramento-San Joaquin Delta (Bay-Delta), 
describing a variety of Federal actions and investments the 
Administration has been undertaking or will take to help address 
California's water supply and ecological crises. Multiple agencies 
within USDA contribute to implement practices that have a high impact 
on water resources in targeted landscapes. In 2010, USDA identified 
landscapes of national importance including national forests and 
private working lands in and around the California Bay-Delta, and 
updated the contribution each agency will make to the high impact on 
water resources goal, in the immediate future. The Forest Service is 
working with Natural Resources Conservation Service (NRCS) and the Farm 
Service Agency (FSA) to develop outcome-based measures for 2012 and 
subsequent years.
    The Forest Service manages resources on NFS forests land to ensure 
that they are sustainable and productive for water, wildlife, 
rangelands, timber, and the multitude of other resources found on 
national forests and grasslands.
    The NRCS has been developing interagency and nongovernmental 
organizations (NGOs) partnerships to improve and protect the health of 
the Bay-Delta headwaters by restoring forest lands and wet meadows.
    USDA Secretary Tom Vilsack and Forest Service Chief Tidwell have 
made clear the Forest Service's important role in water and watershed 
management. Chief Tidwell has said that the Forest Service understands 
the need to manage for water rather than mitigate for water. Managing 
resources on NFS lands often involves striking a delicate balance. What 
one may perceive as less than desirable practices might actually be 
needed for restoration. Consequently, ``better'' forest management does 
not mean the same thing to everyone.
                                 calfed
    Question. Your funding for CALFED is down nearly $4 million from 
fiscal year 2012. What is the primary reason for this decrease? Is this 
the start of a downward trend?
    Answer. In the fiscal year 2012 enacted budget, BOR allocated an 
additional $2.5 million to support actions in the Interim Federal 
Action Plan from the additional $6 million in funds provided by the 
Congress under the Water Conservation and Delivery Studies, Projects 
and Activities Category that was not included in the President's 
request.
    The fiscal year 2013 request accounts for increases from fiscal 
year 2012 and does not represent the beginning of a downward trend as 
the California Bay-Delta Restoration appropriation provides critical 
Federal support toward the co-equal goals of improved water supply 
reliability and an improved Bay-Delta eco-system.
                           klamath settlement
    Question. Where are we on the Klamath settlement? Are we going to 
see significant increased budget requests for BOR when this settlement 
is resolved?
    Answer. The Department of the Interior has not signed the Klamath 
Basin Restoration Agreement (KBRA) and the Congress has not acted on 
legislation introduced in the House and Senate to authorize a 
secretarial determination under the terms of the Klamath Hydroelectric 
Settlement Agreement (KHSA). However under existing law, the Department 
has the authority to provide water and power benefits as well as 
addresses our tribal trust and Endangered Species Act (ESA) 
obligations.
    If the legislation is enacted, budget increases would be 
anticipated as the KBRA legislation would likely require specified 
levels of funding over the succeeding 15 years.
                         south dakota projects
    Question. I note that your budget request for rural water funding 
is increased. Will this funding level allow these projects to keep pace 
with inflation? My fear is that with these funding levels, these 
projects will never get completed. I am gratified to see that one of 
the projects in South Dakota is scheduled for completion in fiscal year 
2013, but where are we on the others? Will they be completed on any 
sort of a reasonable timeline?
    Answer. BOR is making progress on completing rural water projects 
throughout North and South Dakota, Montana, and New Mexico. The Mid-
Dakota rural water project was completed in fiscal year 2006; numerous 
features within the Garrison Diversion Unit in North Dakota have been 
completed; and the Mni Wiconi Rural Water System is scheduled to be 
completed in 2013. Approximately $232 million in American Reinvestment 
and Recovery Act (ARRA) funds were provided to rural water to further 
construction on these projects. Due to the additional ARRA funding, 
Perkins County Rural Water Project received enough funding to complete 
construction based on the authorized appropriations ceiling.
    The budget request for rural water is a 7-percent increase from the 
fiscal year 2012 enacted amount and an 11-percent increase from the 
fiscal year 2011 enacted amount.
    The total Federal cost to complete the construction of ongoing 
projects in BOR is approximately $1.3 billion. The fiscal year 2013 
President's request balances several priorities, including funding for 
constructing authorized rural water projects. Given the need to work 
within the framework of today's budget realities, as well as the need 
to be attentive to priorities associated with existing water and power 
infrastructure throughout the West, BOR is unable to fund all of the 
ongoing rural water projects at their full-capability levels.
    We will continue to evaluate each project using the revised interim 
criteria and concentrate on finishing projects with the funding made 
available through appropriations.
    The first priority for funding rural water projects is the required 
Operations and Maintenance (O&M) component, which is $18 million for 
fiscal year 2013. The rural water request for construction was 
developed using revised interim criteria (BOR used the same approach to 
allocate additional fiscal year 2012 funds). These revised interim 
criteria address BOR's program goals and objectives by incorporating 
factors such as time and financial resources committed, regional 
watershed perspective, urgent and compelling need, tribal members 
served, economic impacts, and water use efficiency. BOR allocated the 
funds based on each project's ability to use those funds to complete 
distinct construction segments which would significantly advance the 
provision of potable water to people.
    Since 1980, the Congress has directed BOR to develop 13 individual 
rural water supply projects at a combined cost of more than $2.3 
billion. Projects have been authorized with non-Federal contribution 
requirements ranging between 0 percent and 25 percent.
    With a large backlog of rural water projects waiting to be 
constructed and limited funding available, BOR developed the revised 
interim criteria in order to apply a consistent and fair method for 
allocating funds.
                      san joaquin restoration fund
    Question. It is my understanding that the Friant surcharges that 
used to go into the CVP Restoration Fund now go into the San Joaquin 
Restoration Fund. However, where BOR used to appropriate those funds in 
the CVP Restoration Fund, that they are being treated differently in 
the San Joaquin Restoration Fund. Is it true that these funds are being 
collected but are not being appropriated as a part of the budget 
request?
    Answer. No, BOR has requested discretionary appropriations to use 
funds deposited into the San Joaquin River Restoration Fund (SJRRF) in 
both the fiscal year 2012 and fiscal year 2013 budget requests. As 
described in section 10009 of Public Law 111-11, funds deposited into 
the SJRRF include the following:
  --the Friant Division Surcharge;
  --the construction cost component of payments made by the Friant 
        Division, Hidden Unit and Buchanan Unit long-term contractors;
  --proceeds from the sale of water or land pursuant to the Settlement; 
        and
  --any non-Federal funds contributed for implementation of the 
        Settlement.
    The request made for discretionary appropriations to use funds 
deposited into the SJRRF in fiscal year 2012 and fiscal year 2013 
reflects the funding needs of the restoration program.
                           california drought
    Question. What are the drought projections for this year?
    Answer. Water supply conditions have improved significantly in 
March and April, but we still may be looking at seasonal runoff indices 
falling below historical average, especially in the San Joaquin Valley. 
The water supply in the southern part of California has not shown as 
much improvement due to less precipitation relative to Northern 
California and the difficulty of moving CVP water through the Delta. 
The U.S. Seasonal Drought Outlook released by National Oceanic and 
Atmospheric Administration (NOAA) on May 17, 2012, is attached.




    Question. What are the CVP Reservoirs (capacity) current storage as 
of May 18, 2012?
    Answer. Shasta Reservoir (4,552,000 acre-feet) now 4,436,000 acre-
feet; Trinity Reservoir (2,448,000 acre-feet) now 2,350,000 acre-feet; 
Folsom (977,000 acre-feet) now 908,000 acre-feet; New Melones 
(2,420,000 acre-feet) now 1,891,000 acre-feet; Millerton (520,000 acre-
feet) now 430,000 acre-feet.
    Question. What is the latest projection on water deliveries from 
BOR projects in California?
    Answer. CVP is currently at 100 percent for the Sacramento River 
water rights settlement contractors, 100 percent for San Joaquin water 
rights exchange contractors, 100 percent of level 2 wildlife refuge 
supply, 100 percent for Agriculture and Municipal and Industrial (M&I) 
users north of the Delta, 75 percent of historical use for M&I users 
south of the Delta, and 40 percent for agricultural users south of the 
Delta.
                      bay-delta conservation plan
    Question. Commissioner Connor, a lot of concern has been expressed 
to me about the Bay-Delta Conservation Plan (BDCP) process. Can you 
tell us what your plans are for thoroughly studying all conveyance 
alternatives for moving water past the Delta, not just the large, 
isolated conveyance facility that has been identified?
    Answer. While the current BDCP effects analysis evaluates a 15,000 
cubic foot/second (cfs) facility, the BDCP Environmental Impact Report/
Environmental Impact Statement (EIR/EIS) is evaluating a wide range of 
alternatives. There are 15 action alternatives and 1 no-action 
alternative which will be described in the BDCP EIR/EIS. The BDCP EIR/
EIS is analyzing various combinations of water conveyance 
configurations including capacities ranging from 3,000 to 15,000 cfs, 
different operating scenarios, habitat restoration, and the effects on 
biological resources and water supply. In addition to conveyance, the 
alternatives include a variety of conveyance alignments and other 
specifications resulting from public scoping sessions conducted in 2008 
and 2009 and the California Water Reform Act of 2009.
    Question. How will studies of through-Delta conveyance figure into 
the overall BDCP process?
    Answer. The information resulting from the EIR/EIS studies 
(including the through-Delta conveyance) being conducted will be used 
for the selection of the proposed project submitted by the State of 
California as part of ESA section 10 application process.
    Question. After all diversion and nondiversion conveyance 
alternatives have been identified, it is essential that a thorough 
benefit-cost analysis be conducted for each. Can you tell us how you 
plan to go about that?
    Answer. As part of the overall BDCP process, several analyses are 
being completed that address costs and benefits. First, the current 
BDCP draft documents include initial cost estimates for construction 
and implementation of a preliminary project. Secondly, the State of 
California is conducting an economic analysis of the benefits 
associated with BDCP alternatives. Lastly, the BDCP environmental 
documentation will include an analysis of the socioeconomic impacts 
associated with alternatives. This information will be used to 
determine the proposed project to be included in the ESA section 10 
permit application.
                        delta and delta counties
    Question. Will the benefit-cost analyses you undertake include all 
foreseeable direct and indirect economic impacts of the Delta and Delta 
Counties, including the impacts of any new water infrastructure and 
habitat conservation projects? If not, why not?
    Answer. Yes, the cost and benefits analysis identified above will 
assist in identifying the direct and indirect economic impacts of any 
new conveyance facility in the Delta.
                      bay-delta conservation plan
    Question. It is essential that all decisions made through the Bay-
Delta Conservation Plan (BDCP) process be based on the best possible 
science. What steps are taking to ensure that all BDCP proposals are 
given an independent review that involves all stakeholders, including 
the Delta Counties?
    Answer. BOR continues to reaffirm the Federal commitment to work in 
close partnership with the State and key stakeholders including the 
Delta Counties to pursue the development of the BDCP. BOR is fully 
committed to a sound and credible scientific basis for BDCP. This 
commitment has been unwavering and has been frequently reiterated. 
Credible science is essential for the BDCP to meet regulatory approval 
standards and to garner broad stakeholder support. The science issues 
underlying BDCP are long standing, complex, and, in certain cases, 
contentious. Federal agencies have engaged independent science review 
under the Delta Stewardship Council's Delta Science Program and are in 
partnership with the State, working towards a sound and credible 
scientific basis for the BDCP.
    Question. Does the BDCP process include establishing through-Delta 
flow standards, consistent with California's water rights priority 
system and statutory protections of area of origin prior to the 
adoption of BDCP? If so, please describe that process.
    Answer. The BDCP process is not establishing new through-Delta flow 
standards. However, any BDCP proposed project must comply with State 
water rights, including State Water Resources Control Board flow 
requirements.
    Question. Does the BDCP process include a science-based peer-
reviewed analysis of water amounts and flows needed for use, under 
current law, in the Delta for determining available surplus water 
supply, and does the BDCP restrict the exporting of water from the 
Delta to only surplus water?
    Answer. Yes, any water conveyed as part of BDCP must meet 
beneficial use standards as required by State law. No, the working 
assumption of BDCP does not include any reliance on surplus water.
                 title xvi water reclamation and reuse
    Question. In your fiscal year 2013 budget request, you identify 
water conservation as one of BOR's priority goals. Can you tell us what 
role the title XVI Water Reclamation and Reuse program has played and 
will continue to play in your efforts to achieve that goal?
    Answer. BOR's Priority Goal for Water Conservation is to enable 
capability to increase available water supply by 730,000 acre-feet of 
water by the end of fiscal year 2013. As a result of fiscal year 2010 
and fiscal year 2011 funding, the title XVI program has contributed 
more than 25,000 acre-feet to the priority goal. Title XVI projects are 
a key part of BOR's efforts to address water supply sustainability and 
will continue to make an important contribution toward this priority 
goal. Fiscal years 2012 and 2013 funding for title XVI projects will 
result in additional contributions to the goal.
    Question. The subcommittee is aware of the priority that BOR places 
on title XVI projects that seek to address water supply needs on a 
watershed basis. Does BOR agree that there is an opportunity to enhance 
the program's effectiveness through the advancement of regional-scale 
projects that include multiple jurisdictions and generate environmental 
as well as water supply benefits?
    Answer. In 2010, BOR established funding criteria for the title XVI 
program after incorporating comments from title XVI project sponsors, 
members of the public, and others (including one Member of Congress). 
The criteria are intended to meet a number of important program goals, 
such as increasing water supply and reducing the need to develop new 
water supplies, addressing environmental concerns, and exploring the 
use of renewable energy as part of water reuse, among others. As you 
point out, the criteria also address the extent to which a project 
incorporates a watershed-based approach. In fact, the criteria provide 
significant consideration of the extent to which a project implements a 
regional planning effort or includes collaborative partnerships among 
multiple entities to meet the needs of a region or watershed. BOR 
agrees that regional scale projects that include multiple partners and 
generate significant environmental benefits are important, and we are 
confident that BOR's existing funding criteria provide ample 
opportunity for sponsors of those projects to receive additional 
consideration based on those benefits. At the same time, BOR plans to 
review this year's process prior to development of next year's funding 
opportunity to ensure that title XVI program funding is allocated as 
effectively as possible.
    Question. These regional projects can require longer planning and 
construction timeframes than other more narrowly focused projects. What 
steps has BOR taken within the overall title XVI program to advance 
regional-scale water reclamation and reuse projects?
    Answer. In fiscal year 2011, BOR used a Funding Opportunity 
Announcement (FOA) for the first time in the title XVI program to 
allocate available appropriations. This year, BOR made significant 
revisions to the FOA to address feedback and to ensure that the program 
works, as well as possible and in a way that minimizes the burden on 
project sponsors. For example, under the revised FOA, sponsors of large 
projects may request up to $4 million each year as planning, design, 
and construction activities continue, without being asked to divide 
those large projects into smaller phases. Again, prior to development 
of funding opportunities for fiscal year 2013, BOR plans to assess this 
year's process and will consider additional revisions, if necessary.
                        anadromous fish screens
    Question. To date, Federal funding provided through the CVP 
Restoration Fund's Anadromous Fish Screen Program (AFSP) has 
contributed to the completion of 29 projects resulting in screening of 
more than 4,833 cubic feet per second of unscreened diversions. Do you 
agree that this program has been contributed greatly to the goals of 
the CVPIA?
    Answer. Since CVPIA's enactment in 1992, AFSP has partnered with 
numerous water districts, the State of California, and other non-
Federal entities in the screening of both large and small intake 
diversions on the Sacramento and San Joaquin Rivers. Through fiscal 
year 2011, 33 projects screening 5,054 cfs have been completed. The 
screening of these facilities has certainly reduced the entrainment of 
endangered fish species (winter-run Chinook salmon, Central Valley 
steelhead, etc.) and has contributed towards achieving the CVPIA's 
goals. The AFSP is funding studies and monitoring activities to help 
quantify fish screening benefits to Anadromous fish.
    Question. For fiscal year 2012, BOR received a total of $10,349,000 
for AFSP. Can you tell how those funds will be spent?
    Answer. The AFSP's budget for fiscal year 2012 is broken down as 
follows:
  --Agency Staff Labor = $1.072 million.
  --Studies and Monitoring = $0.765 million.
  --Planning (design, environmental compliance, permitting, etc.) = 
        $0.165 million.
  --Construction = $8.347 million (available for the construction of 
        the Natomas (Phase 2a), Meridian (Phase 2), and Reclamation 
        District (RD) 2035 fish screen projects, depending on the 
        availability of the non-Federal cost share. To date, no 
        district has provided a non-Federal funding commitment).
    Question. Can you provide us with a status report, including 
funding needs for fiscal years 2012, 2013, 2014, and 2015, for each of 
the projects currently under construction or planned for construction 
under AFSP?
    Answer. The response for fiscal year 2012 was provided above. For 
fiscal years 2013, 2014, and 2015, all three projects expect to begin 
construction, depending on whether or not all funding sources are 
secured. For the Natomas (Phase 2b and 3), RD 2035, and Meridian (Phase 
2) fish screen projects, the approximate Federal share is estimated to 
be $9 million, $18 million, and $9.5 million, respectively. 
Construction periods for the Natomas, RD 2035, and Meridian projects 
are 3 years, 3 years, and 2 years, respectively. All Federal funding 
requires the district to secure a non-Federal funding match.
    In addition to the three fish screen projects mentioned above, 
another proposed project is the West Stanislaus Irrigation District's 
(WSID) fish screen project on the San Joaquin River. This project is in 
the early planning stage; therefore, its construction costs are not 
well defined at this time. Construction of WSID's project could begin 
as early as 2015, pending completion of all planning, environmental 
compliance, design, and permitting activities.
    Question. Is BOR committed to providing the 50 percent Federal 
share of the cost of construction of the fish screen projects for RD 
2035, the Meridian Farms Water Company, and the Natomas Mutual Water 
Company?
    Answer. Subject to sufficient Federal appropriations, BOR is 
committed to providing up to a maximum of 50 percent of these fish 
screen projects' costs. However, this commitment is dependent on there 
being a secured non-Federal funding match.
                         title xvi--watersmart
    Question. While Tennessee is not a Reclamation State, the work that 
BOR does in the West has an impact nationwide. While water reclamation 
and reuse is not currently a concern in Tennessee, it could have an 
impact in the future, and I am interested in the program that 
reclamation undertakes. How are the choices made for the projects that 
are funded under the WaterSMART grant program? Note: The question 
refers to water reclamation and reuse; therefore, these proposed 
responses focus on title XVI instead of WaterSMART.
    Answer. The extent to which each project will reduce demands on 
existing water supplies by making recycled water available; whether the 
project will make water available to address a specific local water 
supply concern and whether recycled water will continue to be available 
during periods of drought; the extent to which additional funding will 
bring a project close to completion; the extent to which the project is 
ready to proceed, including completion of necessary environmental 
compliance; the extent to which the project will improve water quality 
or provide water for endangered species; the extent to which the 
project incorporates renewable energy and addresses energy efficiency; 
the cost per acre-foot of water expected to be delivered by the project 
as compared to alternatives; the extent to which the project would help 
to meet the Federal Government's legal requirements such as providing 
water for water rights settlements or river restoration; the extent to 
which a rural or economically disadvantaged community would be served 
by the project; and the extent to which the project incorporates a 
watershed perspective, including use of regional planning efforts 
across geographically dispersed localities and collaboration among 
multiple entities.
    Funding criteria for WaterSMART Water and Energy Efficiency Grant 
proposals include the following:
  --The extent to which the project is expected to result in 
        quantifiable water savings or would otherwise improve water 
        management;
  --The reasonableness of costs for the improvements proposed;
  --The extent to which the project would increase the use of renewable 
        energy in the management of water or otherwise would result in 
        increased energy efficiency;
  --The extent to which the project is expected to benefit endangered 
        species;
  --The extent to which the project proposes water marketing elements, 
        such as establishment of a new water market or would contribute 
        water toward an existing market;
  --Other contributions to water supply sustainability, including 
        addressing specific local concerns, promoting collaboration 
        among parties, or helping to expedite future on-farm irrigation 
        improvements;
  --Project planning and readiness to proceed;
  --The applicant's description of performance measures that will be 
        used to quantify actual project benefits; and
  --Connection to BOR project activities.
    Sponsors of authorized title XVI projects and applicants for 
WaterSMART Grant funding are asked to apply for funding by responding 
to a Funding Opportunity Announcement posted for the public. A team of 
BOR employees applies criteria to the applications received to rank 
proposals and projects are prioritized accordingly.
    Question. What is the maximum amount of the grants made under this 
program?
    Answer. Each of the 53 congressionally authorized projects includes 
an appropriations ceiling for the project--typically $20 million, 
although some authorized projects have a smaller or larger ceiling. 
This year, BOR's Funding Opportunity Announcement informed applicants 
that no more than $4 million in fiscal year 2012 appropriations would 
be made available to any particular project, up to the amount remaining 
under the appropriations ceiling for that project.
    Question. Is there any allowance made for providing larger grants 
to regional projects?
    Answer. To allocate the limited funding available under the title 
XVI program (approximately $19 million in fiscal year 2012 for title 
XVI funding opportunities) among a number of project sponsors seeking 
funding, grants in excess of $4 million were not possible this year. 
Project sponsors may apply for additional funding in fiscal year 2013 
as construction on projects continues.
    As BOR prepares a funding opportunity for fiscal year 2013, we will 
evaluate this year's process--including that funding level of $4 
million per project--and make revisions if necessary to ensure that the 
program works as effectively as possible for project sponsors.
                    indian water rights settlements
    Question. We provided about $51 million last year for Indian Water 
Rights Settlements. Has all of that funding been obligated to the 
various tribes for which it was specified?
    Answer. BOR will obligate the entire $51 million appropriated to 
BOR in fiscal year 2012 by the end of the year. The following 
represents the funding status of each of the acts within the Claims 
Resolution Act.
      Navajo Gallup Water Supply Project.--For fiscal year 2012, the 
        enacted amount was $24.5 million of which, $17.7 million has 
        been obligated to date. Through construction contracts and 
        three financial assistance agreements (to provide funding to 
        entities for design and construction portions of the project) 
        we anticipate that all funds will be obligated by the end of 
        fiscal year 2012.
      Taos Pueblo Indian Water Rights Settlement Act.--In fiscal year 
        2012, $4 million of the $51 million enacted was appropriated 
        for the Taos Pueblo Indian Water Rights Settlement Act. This 
        settlement requires $36 million to be deposited into the non-
        interest bearing Taos Pueblo Water Development Fund in the U.S. 
        Treasury. This funding will be made available after the 
        settlement enforcement date of March 31, 2017, to provide 
        grants to plan, permit, design, engineer, and construct the 
        Mutual Benefits Projects. All appropriated dollars will be 
        deposited into the Taos Pueblo Water Development Fund by the 
        end of the fiscal year.
      Aamodt Litigation Settlement Act.--In fiscal year 2012, $9.3 
        million of the $51 million enacted was appropriated for the 
        Aamodt Litigation Settlement Act. As of May 1, 2012, $302,688 
        of this funding has been obligated. The majority of the $9.3 
        million is expected to be obligated by September 30, 2012, for 
        planning and engineering design data collection efforts and a 
        National Environmental Policy Act (NEPA) support services 
        contract for the Pojoaque Basin Regional Water System.
      Crow Tribe Rights Settlement Act.--BOR and the Crow Tribe 
        executed a Public Law 93-638 construction contract under 
        section 405 on September 13, 2011. Under this contract, BOR has 
        obligated the entire fiscal year 2012 appropriated amount of 
        $8.2 million.
      White Mountain Apache Tribe (WMAT) Water Rights Quantification 
        Act.--In September 2011, the $3.2 million discretionary funding 
        received for the WMAT was obligated. To date, the $4.8 million 
        discretionary funding received in fiscal year 2012 has not been 
        obligated, however, is expected to be fully obligated by the 
        end of the fiscal year.
    Question. Some of this Settlement funding was to be used for water 
systems on the reservations. Can you give us an update on the progress 
of these water systems?
    Answer. The following represents the status of each of the water 
systems within the Claims Resolution Act.
      Navajo Gallup Water Supply Project.--The authorizing legislation 
        identified eight pre-construction activities that were required 
        to be completed prior to commencing construction of the 
        Project. All of those activities have now been completed and 
        the corresponding agreements and contracts have been executed. 
        Pre-construction work, including design, Right of Way 
        acquisition, and environmental and cultural resource compliance 
        activities continue in fiscal year 2012 for reaches that will 
        be constructed in the future. The pre-construction land 
        clearances and designs have also been completed to allow for 
        the initial construction to begin in fiscal year 2012. In 
        addition to the pre-construction activities discussed above, 
        construction is scheduled to begin in several areas of the 
        project in fiscal year 2012.
      Taos Pueblo Indian Water Rights Settlement Act.--BOR has 
        requested $4 million to be deposited into the Taos Pueblo Water 
        Development Fund. All of the $20 million in discretionary 
        appropriations authorized by Public Law 111-291 (of which the 
        $4 million is a part) must be appropriated and deposited in the 
        Fund by the settlement enforcement date of March 31, 2017. None 
        of the funds are intended to be used on water systems located 
        on reservation lands. The funds are for the Mutual-Benefit 
        Projects, which are intended to minimize impacts on the 
        Pueblos' water resources by moving non-Indian ground water 
        pumping away from the Pueblos' lands.
      A contract has been executed with the Pueblo of Taos for their 
        share of San Juan-Chama Project (SJCP) water. The Taos 
        Agreement should be ready for execution later this year. SJCP 
        contracts have been negotiated with the Town of Taos and El 
        Prado. Appraisal level designs and cost estimates are being 
        prepared for some of the mutual benefits projects. This work 
        has been accomplished with Native American Affairs Program 
        funding.
      Aamodt Litigation Settlement Act.--Using fiscal year 2012 
        appropriations, BOR has developed project management plans, 
        begun engineering design data collection in coordination with 
        the project stakeholders, and has initiated Government-to-
        Government consultations with the Pueblos of Nambe, Pojoaque, 
        Tesuque, and San Ildefonso. BOR expects to award a contract for 
        NEPA compliance support services in July and anticipates 
        awarding contracts for geotechnical investigations in 
        September.
      Crow Tribe Rights Settlement Act.--For the Crow Irrigation 
        Project within the contract initiated under Public Law 93-638, 
        BOR reviewed and provided comments on plans and specifications 
        to the tribe for Lodge Grass #1 and #2 diversion structures, 
        and the tribe prepared final plans and specifications, based on 
        BOR's review. Procurement of materials for these facilities is 
        starting this spring and the tribe plans to construct these 
        facilities in the fall of 2012 after the irrigation season 
        concludes.
      White Mountain Apache Tribe (WMAT) Water Rights Quantification 
        Act.--The WMAT is currently in the process of soliciting for 
        and awarding design contracts to complete the design work of 
        the Miner Flat Project to the 30 percent stage to enable 
        completion of an Environmental Impact Statement (EIS). The WMAT 
        is also currently in the process of soliciting and awarding a 
        contract for environmental services for EIS development.
                  central utah project completion act
    Question. You have proposed reintegrating the Central Utah Project 
back into BOR's budget as opposed to it being separate as it has been 
for the last 20 years. Why is this being proposed for fiscal year 2013?
    Answer. This consolidation fits in with broader Administration 
efforts to implement good Government solutions and consolidate and 
streamline activities where possible. The Central Utah Project 
Completion Act (CUPCA) is the only major water project within the 
Department of the Interior (DOI) not managed by BOR. The proposed 
consolidation is intended to ensure that all major water projects 
within DOI receive equal and consistent consideration and treatment.
    Question. Will this improve the management of the Central Utah 
Project?
    Answer. The proposed consolidation will leave the management of 
completing construction of the CUPCA with the Central Utah Water 
Conservancy District. Oversight and administrative responsibilities 
will move from the Department's Assistant Secretary for Water and 
Science to BOR. Consolidation of the CUPCA Office into BOR will enhance 
local responsiveness and program access to the functions within BOR 
that currently provide administrative support for implementation.
    Question. Are there any cost savings by making this change to the 
Central Utah Project?
    Answer. The consolidation will likely have very little impact on 
costs. No significant cost savings or increase in costs is anticipated.
    Question. What happens to the personnel that are currently 
responsible for the Central Utah Project, are they shifted to BOR's 
payroll?
    Answer. We anticipate that personnel in the CUPCA Office would be 
shifted to BOR; however, the details of the consolidation have not been 
finalized.
    Question. Will this change affect the responsibilities of the non-
Federal partners on the Central Utah Project?
    Answer. The consolidation will not impact the non-Federal partners 
involved with the completing CUPCA. All non-Federal responsibilities 
and authority as described in the original CUPCA legislation would 
remain unchanged.
                                 ______
                                 
              Questions Submitted by Senator Patty Murray
                      odessa subarea special study
    Question. Commissioner Connor, as you know the Odessa Subarea 
Special Study is nearing the end of a 5\1/2\-year effort to develop 
alternatives to maintain the economy and jobs base of the Columbia 
Basin region by substituting Columbia Basin Project water supplies for 
groundwater irrigation. The groundwater aquifer is being rapidly 
depleted which threatens not only continued agricultural production but 
domestic and municipal water supplies for the region's cities.
    I am concerned that the Study is being conducted using the rigid 
``Principles & Guidelines'' study methodology that often does not take 
into account real world realities and that BOR applies overly cautious 
construction contingency margins that are out of line with current 
construction experience.
    Is BOR committed to timely completion of the Study and to playing a 
significant role in finding solutions to the water supply problem of 
the Columbia Basin Project area?
    Answer. Yes, BOR is committed to the timely completion of the 
Odessa Subarea Special Study and is in the process of completing the 
Final Environmental Impact Statement and planning documents by summer 
2012.
    The Preferred Alternative is being developed in consultation with 
our Study partners in response to public comment on the Draft 
Environmental Impact Statement. This alternative will provide a good 
opportunity for public private partnerships and maximizes the use of 
the existing Columbia Basin Project infrastructure.
    Question. The State of Washington has already invested millions of 
dollars in the Study and other Columbia Basin Project capital projects. 
What are BOR's plans for integrating funding for project elements in 
the Administration's budget request, starting in fiscal year 2014?
    Answer. BOR's cost is shared with the State of Washington on this 
Study as well as other Columbia Basin Project capital projects. 
Implementation of the project is dependent on completion of 
environmental compliance which is our focus in the near term.
    As stated above, BOR is committed to completion of the Study; 
however, future budget requests are contingent upon the completion and 
outcome of the Study.
                                 ______
                                 
             Questions Submitted by Senator Lamar Alexander
                               hydropower
    Question. Commissioner Connor, given the Bureau of Reclamation's 
(BOR) ownership of thousands of megawatts of hydropower facilities, and 
the March 31, 2011, Department of the Interior report on the potential 
to create clean energy at BOR facilities, what is the Bureau doing on 
this issue?
    Answer. BOR is focusing its efforts on creating new clean energy on 
two fronts. The first is by updating and improving the efficiencies of 
its existing hydropower generators and the second is by encouraging 
development of new hydropower on dams and canals where hydropower is 
currently unavailable.
    BOR currently owns and operates 53 hydroelectric powerplants with 
an installed capacity of 14,803 megawatts of installed capacity. While 
BOR has a long history of increasing the capacity and efficiency of its 
hydrogenerators, this initiative could be expanded. By replacing its 
older hydrogenerator turbines with more efficient turbines, rewinding 
generators to increase capacity and optimizing operation of existing 
generators, clean hydropower generation could be increased by an 
estimated 2 to 3 percent.
    To encourage new non-Federal development on BOR dams and canals, 
BOR has performed two hydropower resource assessments. The first 
identified 268 megawatts of additional hydroelectric capacity which 
could be developed primarily at 191 Reclamation dams. The second 
assessment identified 104 megawatts of hydroelectric capacity which 
could be developed on BOR canals and conduits. Together these studies 
identified 1,565 million megawatt-hours of new renewable energy which 
is enough to power 130,000 homes.
    BOR is also revising its process for development of power at BOR 
facilities through lease of power privilege which is currently under 
review. This effort will help make the process clear to developers.
    Due to these efforts, there are 20 new non-Federal hydropower 
plants being developed on BOR facilities.
    Question. What would it take for the BOR to modernize and upgrade 
its facilities to result in more clean-energy production?
    Answer. BOR could increase its clean hydropower generation by 2 to 
3 percent through hydrogenerator turbine replacements, rewinds and 
optimization projects. Within BOR, 22 percent of hydroelectric 
generator windings and 30 percent of our turbines are 40 years old or 
older and have not been refurbished. Using a risk and condition based 
approach of prioritizing rehabilitations, BOR continues to work with 
its Federal power customers to better identify and schedule these 
opportunities.

    Senator Feinstein. Okay. Just so everybody here knows the 
impact of this, California, I should say, America's largest 
agriculture State is California.
    In 2009 when we had a similar situation, you had 45 percent 
unemployment. You had farmers in bread lines. It was really a 
terrible, terrible situation. So what we're trying to do is 
essentially make certain adjustments that could provide at 
least a flow of water necessary to have a somewhat positive 
farming experience without throwing people into unemployment.
    It's a huge, huge industry. You've been wonderful, and we 
appreciate it. Please keep going because 150 to 200 acre-feet 
isn't going to do it.

                          SUBCOMMITTEE RECESS

    Senator Feinstein. Everybody, I think that completes our 
hearing. Thank you very much, General, two Secretaries, Mike, 
thank you very much. The hearing is adjourned.
    Ms. Darcy. Thank you, Madam Chair.
    Mr. Connor. Thank you.
    [Whereupon, at 4:30 p.m., Wednesday, March 28, the 
subcommittee was recessed, to reconvene subject to the call of 
the Chair.]
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