[Senate Hearing 115-277]
[From the U.S. Government Publishing Office]


 
    ENERGY AND WATER DEVELOPMENT APPROPRIATIONS FOR FISCAL YEAR 2018

                              ----------                              


                        WEDNESDAY, JUNE 28, 2017

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 2:30 p.m., in room SD-138, Dirksen 
Senate Office Building, Hon. Lamar Alexander (chairman) 
presiding.
    Present: Senators Alexander, Cochran, Shelby, Murkowski, 
Hoeven, Kennedy, Feinstein, Tester, Udall, Shaheen, Merkley, 
and Coons.

                      DEPARTMENT OF DEFENSE--CIVIL

                         Department of the Army

                       Corps of Engineers--Civil

STATEMENT OF HON. TODD T. SEMONITE, LIEUTENANT GENERAL, 
            COMMANDING GENERAL AND CHIEF OF ENGINEERS


              opening statement of senator lamar alexander


    Senator Alexander. The Subcommittee on Energy and Water 
Development, please come to order.
    Today's hearing will review the President's fiscal year 
2018 budget request for the Army Corps of Engineers and the 
Bureau of Reclamation, which is part of the Department of the 
Interior.
    This is the subcommittee's fourth and final budget hearing. 
We are doing our best to get to the head of the line among 
those subcommittees that have appropriations work to do.
    Senator Feinstein and I will each have an opening 
statement. This gives me an opportunity to express, Senator, 
once again, how much I value the relationship we have, and the 
way we are able to work together with our staffs, who also work 
together to produce legislation that is good for this country. 
So I thank her for her leadership and her professionalism.
    I will then ask each Senator, who is here, for up to five 
minutes for an opening statement after Senator Feinstein and I 
do. We will turn to our witnesses, then, to present testimony 
on behalf of the Corps and the Bureau each.
    We would like to ask each of you to keep your testimony to 
about five minutes, which will give us time to ask questions. 
Then I will give Senators an opportunity to ask five minutes of 
questions each. We should have enough time for all the Senators 
to ask questions. Senator Feinstein and I have another meeting 
at 4:15 p.m. that we have to go to, so we will be through by 
then.
    I want to thank our witnesses for being here. Thanks 
Senator Feinstein. Our witnesses include Douglas Lamont, Senior 
Official, performing the duties of the Assistant Secretary of 
the Army for Civil Works. Lieutenant General Todd Semonite, 
Chief of Engineers for the U.S. Army Corps of Engineers. Alan 
Mikkelsen, Acting Commissioner for the Bureau of Reclamation at 
the Department of the Interior.
    Today I will focus my questions on four main areas. One, 
making our Nation's water infrastructure a priority; two, 
properly funding our inland waterway system; three, adequately 
funding our Nation's ports and harbors; and four, using a more 
common sense approach to making funding decisions by looking at 
the remaining Benefit to Cost Ratio of an ongoing project 
instead of pretending the project is not already under 
construction, which is what the Corps has to do today because 
of the Office of Management and Budget rules.
    Now, on the water infrastructure priority, based upon the 
number of appropriations requests we receive each year, the 
Corps of Engineers must be the Federal Government's most 
popular agency.
    The Corps' projects attract the intense interest of the 
American people--all of the Senators who are here, including 
the Chairman, Senator Cochran, whom we welcome--and of their 
United States Senators.
    I can recall when I was a member of the Environmental and 
Public Works Committee, after the Missouri and Mississippi 
Rivers floods, a whole room full of Senators showed up to ask 
for more money from the Army Corps to deal with what went wrong 
and what went right with disaster relief efforts. So, there is 
a real interest among Senators in what the Corps does.
    The reason this year's budget request is such a problem is 
that the U.S. Corps of Engineers touches the lives of almost 
every American. It maintains our inland waterways, it deepens 
and keeps our ports open, looks after many of our recreational 
waters and land, manages the river levels to prevent flooding, 
and its dams provide emission-free, renewable hydroelectric 
energy.
    It is not the first President to make a budget request that 
is low for the Corps of Engineers, but to make up for these 
shortfalls in this budget, the money has to come from somewhere 
else. In my opinion, we should spend more, not less, on our 
Nation's water infrastructure.
    Last year, Congress provided record funding for our 
Nation's water infrastructure by providing over $6 billion to 
the Corps, the largest amount of funding for the Corps in a 
regular appropriations bill.
    Instead of building on what Congress provided last year, 
the President's budget request proposes only $5 billion for the 
Corps, more than $1 billion cut, or 17 percent less than what 
was provided and what Congress approved for the current fiscal 
year.
    This is an enormous step backwards. In fact, if we simply 
approved the President's request, the Corps of Engineers would 
receive less than what Congress appropriated in fiscal year 
2006, setting us back more than a decade.
    If we look at the condition of the locks and dams that the 
Corps operates, for example, we can easily see exactly why we 
need to spend more, not less, on water infrastructure.
    The National Academies of Science in 2011 said the Corps 
has 138 locks in operation that are over 50 years old, and that 
the average age of our locks is 58 years.
    Using locks is the only way for inland waterway shippers to 
move things like grain, steel, fertilizer, and coal up and down 
rivers. Having to unexpectedly shut them down for extended 
periods of time could be catastrophic for agriculture and other 
commodities that rely on them to get their goods to market. 
Yet, as these facilities age, major upgrades, maintenance, and 
sometimes replacement is required.
    So I think it is fair to ask, why would the President cut 
funding for the Corps of Engineers at a time when more funding 
is needed?
    On June 7, 2017 at a speech in Cincinnati, President Trump 
talked about the importance of our Nation's waterways and 
emphasized the need for more spending to help address the 
maintenance backlog. But apparently, his message did not get 
through to those who write the budget.
    Instead of providing more funding, his budget provides 
less, in fact, 17 percent less than last year, which will not 
help the President achieve his own goal.
    Now, properly funding the waterway system, critical 
projects, such as Chickamauga Lock in Tennessee, have been 
piling up for years due to a lack of funding, and many of us in 
Congress have recognized that we needed to take steps to 
increase funding for the Corps to address this backlog.
    First, Congress passed a law that reduced the amount of 
money that comes from the Inland Waterways Trust Fund to 
replace Olmsted Lock, a project in Illinois and Kentucky that 
was soaking up almost all of the money that is available for 
inland waterway projects.
    Second, Congress worked with the commercial waterways 
industry to establish a priority list for waterways that needed 
to be funded, on which Chickamauga ranks near the top, in 
fourth place.
    And third, in 2014, working together in a bipartisan way, 
we increased the user fee that commercial barge owners were 
asked to pay to provide more money to replace locks and dams 
across the country, including Chickamauga. These user fees are 
deposited in the Inland Waterways Trust Fund.
    These steps increased the amount of funding that was 
available for inland waterways projects from about $85 million 
in 2014 to $105 million this year. These funds in the Trust 
Fund that are paid by waterway users are matched with Federal 
dollars, which allow the Corps to make significant progress to 
address the backlog.
    Yet, the President's budget request only proposes to spend 
$26 million from the Inland Waterways Trust Fund this fiscal 
year, leaving about 84 percent of the available funds unspent. 
That means, in effect, we would be collecting taxes from 
commercial barges to go through the locks in order to improve 
the locks, and then we would be keeping the money, putting it 
in the bank, and not spending it for the intended purpose.
    The budget request also only proposes to fund one project, 
Olmsted Lock, and eliminates funding for the other three 
projects that are already under construction and that received 
funding last year: Lower Monongahela, Kentucky Lock, and 
Chickamauga Lock.
    Replacing Chickamauga Lock is important to all of Tennessee 
and if Chickamauga Lock closes, it will throw 150,000 more 
trucks onto Interstate 75. Construction has been ongoing for 
the past 3 years, so it does not make sense for the 
Administration to not include the project in a budget request.
    I have worked with Acting Secretary Lamont and General 
Semonite over the last year, and I deeply appreciate that 
funding for construction of Chickamauga was included in last 
year's work plan, which was the third consecutive year of 
funding for this important project.
    As General Semonite and I have discussed, starting and 
stopping is not an efficient way to build projects. It wastes 
the taxpayers' money. This year's budget proposal is a huge 
step backward for our Nation's inland waterways.
    I will be asking our witnesses today about the new user fee 
for inland waterways proposed in the budget, which would raise 
about a billion dollars over the next 10 years. This new fee 
would be on top of the fee that was already increased in 2014, 
which the Congressional Budget Office estimated would raise 
$260 million over 10 years.
    We need to spend the money that is already being collected 
before we ask the waterways industry to pay more. It makes no 
sense to ask barge owners to pay more in fees when the 
Administration is not even proposing to spend all the fees that 
we are collecting today.
    The budget request this year also fails to adequately fund 
our Nation's ports and harbors, such as Mobile Harbor in 
Alabama, Savannah Harbor in Georgia, Long Beach Harbor in 
California, and many others.
    Four years ago, Congress looked to provide more funding for 
our Nation's ports and harbors to ensure that we can compete 
with other harbors around the world.
    We realized the Government was spending only a fraction of 
the taxes each year that were collected in the Harbor 
Maintenance Trust Fund for our ports and harbors, resulting in 
billions of dollars of unspent funds just sitting in a bank 
account that got bigger and bigger each year.
    In fact, unlike the Inland Waterways Trust Fund which has 
virtually no balance in the trust fund, the Harbor Maintenance 
Trust Fund has an unspent balance today close to $9 billion.
    To provide more funding for our ports and harbors, Congress 
enacted spending targets for the Harbor Maintenance Trust Fund 
in the Water Resources Reform and Development Act of 2014. We 
have met these targets for the last 3 years in the Energy and 
Water appropriations bill.
    So we have spent all the money that we collected in taxes 
for the inland waterways for the last 3 years. We have met our 
targets for three straight years on the ports and the harbors. 
But this budget would take us backwards.
    The target for 2018 is about $1.34 billion. However, the 
Administration's budget only proposes to spend $965 million, a 
shortfall of $375 million. So I will ask the witnesses how they 
plan to sufficiently fund our ports and harbors without 
requesting adequate resources to do it.
    I would also like to recognize Alan Mikkelsen, Acting 
Commissioner from the Bureau of Reclamation. We are glad you 
are here. The Bureau of Reclamation delivers water to one out 
of every five farmers in the West, irrigating more than 10 
million acres of some of the most productive agricultural land 
in the country.
    Although Reclamation does not manage water resources in 
Tennessee, I know of its deep importance to Senator Feinstein 
and to other Senators of this Committee, and we look forward to 
hearing your testimony.
    [The statement follows:]
             Prepared Statement of Senator Lamar Alexander
    We're here today to review the president's fiscal year 2018 budget 
request for the U.S. Army Corps of Engineers and the Bureau of 
Reclamation, which is part of the Department of the Interior.
    Today I will focus my questions on four main areas:
  --Making our Nation's water infrastructure a priority;
  --Properly funding our inland waterways system;
  --Adequately funding our Nation's ports and harbors; and
  --Using a more common-sense approach to making funding decisions by 
        looking at the ``remaining benefit to cost ratio'' of an 
        ongoing project instead of pretending the project is not 
        already under construction which is what the Corps has to do 
        today because of Office of Management and Budget rules.
          making our nation's water infrastructure a priority
    Based on appropriations requests, the Corps of Engineers is the 
Federal Government's most popular agency.
    Corps of Engineers projects attract the intense interest of the 
American people, and of their United States senators. I can recall 
when, I was a member of the Environmental and Public Works Committee, 
after a flooding of the Missouri and Mississippi rivers, a whole room 
full of senators showed up to ask for more money to deal with what went 
wrong and what went right with disaster relief efforts. So, there's a 
real interest in these proposals.
    The reason this budget request is such a problem is that the U.S. 
Army Corps of Engineers touches the lives of almost every American. The 
Corps maintains our inland waterways, it deepens and keeps our ports 
open, looks after many of our recreational waters and land, manages the 
river levels to prevent flooding, and its dams provide emission-free, 
renewable hydroelectric energy.
    This is not the first president to do this, but to make up for 
these shortfalls, the money has to come from somewhere else.
    In my opinion, we should spend more, not less, on our Nation's 
water infrastructure.
    Last year, Congress provided record funding levels for our Nation's 
water infrastructure by providing over $6 billion to the Corps of 
Engineers--the largest amount of funding for the Corps of Engineers in 
a regular appropriations bill.
    Instead of building on what Congress provided last year, the 
president's budget request proposes only $5.002 billion for the Corps 
of Engineers, which is a more than $1 billion cut, or 17 percent less, 
than what was provided last year in fiscal year 2017.
    This is an enormous step backwards. In fact, if we simply approved 
the president's request, the Corps of Engineers would receive less than 
what Congress appropriated in fiscal year 2006, setting us back more 
than a decade.
    If we look at the condition of the locks and dams that the Corps 
operates across the country, for example, we can easily see exactly why 
we need to spend more--not less on water infrastructure.
    The National Academies of Science in 2011 said the Corps has 138 
locks in operation that are over 50 years old, and that the average age 
of our locks is 58 years.
    Using locks is the only way for inland waterway shippers to move 
things like grain, steel, fertilizer and coal up and down rivers, and 
having to unexpectedly shut them down for extended periods of time 
could be catastrophic for agriculture and other commodities that rely 
on them to get their goods to market.
    Yet, as these facilities age, major upgrades, maintenance, and 
sometimes replacement is required, so I think it's fair to ask, why 
would the president cut funding for the Corps of Engineers at a time 
when more funding is needed?
    On June 7, 2017, in a speech in Cincinnati, Ohio, President Trump 
recognized the importance of our Nation's waterways and emphasized the 
need for additional investment to address the maintenance backlog.
    But instead of providing more funding, his budget provides less--in 
fact, 17 percent less--funding than last year for the Corps of 
Engineers, which will not help him to achieve that goal.
              properly funding our inland waterways system
    Critical projects, such as replacing Chickamauga Lock in my home 
State of Tennessee, have been piling up for years due to a lack of 
funding, and many of us in Congress have recognized that we needed to 
take steps to increase funding for the Corps of Engineers to address 
this backlog.
    First, Congress passed a law that reduced the amount of money that 
comes from the Inland Waterways Trust Fund to replace Olmsted Lock, a 
project in Illinois and Kentucky that was soaking up almost all of the 
money that is available for inland waterway projects.
    Second, Congress worked with the commercial waterways industry to 
establish a priority list for projects that needed to be funded, on 
which Chickamauga ranks near the top, in fourth place.
    And third, in 2014, working together in a bipartisan way, we 
increased the user fee that commercial barge owners asked to pay to 
provide more money to replace locks and dams across the country, 
including Chickamauga Lock. These user fees are deposited into the 
Inland Waterways Trust Fund.
    These steps increased the amount of funding that was available for 
inland waterways projects from about $85 million in fiscal year 2014 to 
$105 million this year.
    These funds--that are paid by waterway users--are matched with 
Federal dollars, which allow the Corps of Engineers to make significant 
progress to address the backlog of work on our inland waterways.
    Yet the president's budget request only proposes to spend $26 
million from the Inland Waterways Trust Fund this fiscal year, leaving 
about 84 percent of the available funds unspent.
    That means, in effect, we would be collecting taxes from commercial 
barges to go through the locks in order to improve the locks, and then 
we would be keeping the money, putting it in the bank, and not spending 
it for the intended purpose.
    The budget request also only proposes to fund a single project, 
Olmsted Lock, and eliminates funding for the other three projects that 
are already under construction and received funding last year--Lower 
Monongahela, Kentucky Lock, and Chickamauga Lock.
    Replacing Chickamauga Lock is important to all of Tennessee and if 
Chickamauga Lock closes, it will throw 150,000 more trucks onto I-75. 
Construction has been ongoing for the past 3 years so it does not make 
sense for the administration to not include the project in the budget 
request.
    I've worked with acting Secretary Lamont and General Semonite over 
the last year and I deeply appreciate that funding for construction on 
Chickamauga Lock was included in last year's work plan, which was the 
third consecutive year of funding for this important project. And as 
General Semonite and I have discussed, starting and stopping is not an 
efficient way to build projects.
    This year's budget proposal is a huge step backwards for our 
Nation's inland waterways.
    I will also be asking our witnesses today about the new user fee 
for inland waterways proposed in the budget which would raise about a 
billion dollars over the next 10 years. This new fee would be on top of 
the fee that was already increased in 2014, which the Congressional 
Budget Office estimated would raise $260 million over 10 years.
    We need to spend the money that is already being collected before 
we ask the waterways industry to pay more. It makes no sense to ask 
barge owners to pay more in fees when the administration is not even 
proposing to spend all the fees we are collecting today.
           adequately funding our nation's ports and harbors
    The budget request this year also fails to adequately fund our 
Nation's harbors, such as Mobile Harbor in Alabama; Savannah Harbor in 
Georgia; and Long Beach Harbor in California, and many others across 
the country.
    Four years ago, Congress took a look at the need to provide more 
funding for our Nation's ports and harbors to ensure we can compete 
with other harbors around the world.
    We realized that the government was spending only a fraction of the 
taxes each year that were collected in the Harbor Maintenance Trust 
Fund for our ports and harbors, resulting in billions of dollars of 
unspent funds just sitting in a bank account that got bigger and bigger 
each year.
    In fact, unlike the Inland Waterways Trust Fund--which has 
virtually no balance in the trust fund--the Harbor Maintenance Trust 
Fund had an unspent balance of about $8.3 billion in 2014, and is about 
$9 billion today.
    To provide more funding for our ports and harbors, Congress enacted 
spending targets for the Harbor Maintenance Trust Fund in the Water 
Resources Reform and Development Act of 2014.
    We have met these targets for the last 3 years in the Energy and 
Water appropriations bill.
    The target for fiscal year 2018 is about $1.34 billion. However, 
the administration's budget only proposes to spend $965 million, a 
shortfall of $375 million.
    So I will ask the witnesses how they plan to sufficiently fund our 
ports and harbors without requesting adequate resources to do it.
    I'd also like to recognize Alan Mikkelsen, acting commissioner from 
the Bureau of Reclamation.
    The Bureau of Reclamation delivers water to one of every five 
farmers in the West, irrigating more than 10 million acres of some of 
the most productive agricultural land in the country.
    Although Reclamation doesn't manage water resources in Tennessee, I 
know of its deep importance to Senator Feinstein and other Senators on 
this subcommittee, and we look forward to hearing your testimony.

    Senator Alexander. With that, I will turn to Senator 
Feinstein for her opening statement.

                 STATEMENT OF SENATOR DIANNE FEINSTEIN

    Senator Feinstein. Thanks very much, Mr. Chairman.
    As I say every year, it still remains a delight to work 
with you, and I very much appreciate your cooperation.
    I would like to begin by welcoming our witnesses. General, 
I have received your note and your comments about your recent 
tour of California projects. I am very pleased you had a good 
visit.
    I know two of our witnesses are temporary stewards for 
their position, so we look forward to moving on and discussing 
some very big problems, not only with you, but with your 
successors as well.
    I am disappointed by the proposals from both agencies and 
the Army Corps' budget for the Civil Works program that is cut 
by $1 billion or 17 percent. That is really horrendous.
    Previous administrations may have proposed similar cuts, 
but President Trump spoke at length during the campaign about 
how he would initiate dramatic new investments in America's 
infrastructure.
    I am here to say that the Army Corps is our only real 
infrastructure project in America today. I am so grateful for 
your work. You are responsible for building, monitoring, and 
repairing critical infrastructure like levees, dams, and 
navigation channels.
    I received one of the big shocks of my life with what 
happened at Oroville Dam a few months ago. A failure to 
properly invest in our water infrastructure put, I think, 
200,000 lives at risk and entire communities at risk as well. 
Oroville, I believe, stands as a warning of further collapses.
    I was just looking at the numbers and we have nearly 2,000 
State-regulated, high hazard dams in the United States that 
were listed as being in need of repair in 2015. That is 
according to the Association of State Dam Safety Officials. And 
a dam, I understand, is considered high hazard based on 
potential for the loss of life as a result of failure.
    By 2020, 70 percent of the dams in our country will be more 
than 50 years old, and that is according to the American 
Society of Civil Engineers.
    What we saw happen at Oroville was just astounding because 
we saw a spillway that was totally inadequate, huge sections of 
which just collapsed, and water just poured with abundance.
    We could have real problems in the future, Mr. Chairman, 
with this area and I am going to take a real look at dams 
throughout America. We would love to work with you in putting 
together a kind of portfolio of need.
    We came within God's good grace by not having thousands of 
people killed in what happened up there. And I want to just 
thank everybody that worked so hard to see that that dam could 
spill properly as soon as possible.
    Over the past 3 years, I have worked hard with Chairman 
Alexander to invest more than $3 million in drought response 
and I am very grateful to him. Last year's Omnibus marked the 
turning point for mitigating an ongoing drought to investing in 
preparations for the next drought.
    And so, I am disappointed that the Bureau's budget request 
appears to, once again, ignore bipartisan efforts made by this 
subcommittee to invest in long term drought resiliency 
infrastructure.
    Chairman Alexander was gracious enough to agree to 
inclusion of the first tranche of funding in the 2017 Omnibus. 
It is my hope that this subcommittee will appropriate the 
funding necessary each year to match those authorizations.
    I want to be clear that we will be closely monitoring the 
two agencies in front of us today to ensure that the United 
States is prepared for the next major drought far better than 
we were for the last one.
    This means not just helping State and local partners build 
new water supply infrastructure, but also other efforts, such 
as: investing in substantially increased monitoring of 
endangered fish species to better inform water pumping 
decisions; developing the science necessary to better predict 
weather phenomenon like atmospheric rivers and use those 
predictions to more flexibly operate dams; creating new tools 
to assess the safety and structural integrity of dams and 
levees without having to empty them or take them offline.
    The other major large scale effort that the two agencies 
before us today, I hope, will focus on is climate change. We 
have seen drought in the west and southeast, increasingly 
erratic winter storms, floods, and potentially catastrophic sea 
level rise.
    Climate change, I believe, will require the Army Corps and 
the Bureau to constantly reevaluate every piece of water 
infrastructure in the United States, how it is managed, how it 
is maintained. As these two agencies and all of their 
scientists know, climate change is real and we must be 
prepared.
    I also really want to point out that the average age of the 
90,580 dams in the United States is 56 years. So I am of the 
opinion that we really do need a program of monitoring and 
preventing what could be a catastrophic outcome. I suspect we 
will have it.
    Just one word of aside, California just has gone through 
its biggest drought in history, since these records were taken. 
Today, June, where our fire season begins in September or 
October, we have six big forest fires burning today.
    We have 102 million dead trees, according to the Forest 
Service. We are expecting massive invasions of beetles and 
other things that fly and do damage.
    So drought, and climate change, and the imprecision of both 
are really upon us in a major way. And given the limited 
resources we have available to us under the spending caps, it 
is really imperative that both agencies before us today think 
critically and creatively to stretch resources and combine 
multiple benefits in each project. I will give you an example.
    This could mean investing in multipurpose projects. It just 
so happens I have one, like the San Francisco Shoreline and 
Hamilton City, where levees will be built for flood protection 
and also conduct eco-system restoration to mitigate rising sea 
levels and improve water quality.
    My experience with the Army Corps over the past 24 years 
has been--Mr. Chairman, coming from a very big State--has been 
remarkable. I have found the heads responsive. They care. They 
have a scientific background. They know what they are doing and 
they do not resent us. And so, I think that that is a very 
positive syndrome for the future.
    So I hope that that will be the case and I believe it will. 
That this Committee, and other committees like it here, could 
work closely with you because I really fear a collapsing dam 
problem throughout the United States based on age, based on 
certain inefficiencies in original construction, and also based 
on lack of proper maintenance.
    So thank you very much, Mr. Chairman.
    Senator Alexander. Thank you, Senator Feinstein.
    We will now proceed to opening statements from other 
Senators.
    I recognize Senator Cochran, our Appropriations Committee 
Chairman, for any statement he may have.
    Senator Cochran.

                   STATEMENT OF SENATOR THAD COCHRAN

    Senator Cochran. Mr. Chairman, thank you very much for 
convening the hearing and presiding at this session.
    We thank the witnesses for being here to help us find out 
more of the details of the budget request submitted for the 
Army Corps of Engineers.
    I ask that my statement be printed in the record.
    [The statement follows:]
               Prepared Statement of Senator Thad Cochran
    Mr. Chairman, thank you for convening this important hearing to 
review the President's fiscal year 2018 budget request for the U.S. 
Army Corps of Engineers and the Bureau of Reclamation. I am pleased to 
welcome our distinguished panel of witnesses, and extend my 
appreciation for the contributions you make to the country in your 
various leadership roles.
    The U.S. Army Corps of Engineers keeps our Nation's infrastructure 
strong during times of peace and war. In carrying out its civil 
mission, the Corps helps ensure continued improvements to our economic 
interests, public safety, and environmental health.
    The Corps' civil works functions are particularly important to my 
State, as port dredging, construction of important flood control 
projects and restoration of damaged coastlines impacts the overall 
quality of life for Mississippians.
    Ensuring that the Corps has adequate funding to meet its 
responsibilities is a high priority of mine. Congress continues to act 
responsibly to use the Energy and Water Development appropriations 
bills as a means to provide the Corps with necessary resources. I look 
forward to hearing our witnesses' testimony, and working closely with 
them and members of this subcommittee as we move forward with the 
fiscal year 2018 appropriations process.
    Thank you, Mr. Chairman, for convening today's hearing.

    Senator Alexander. Thank you, Senator Cochran.
    We will print your comments in the record.
    Senator Udall.

                     STATEMENT OF SENATOR TOM UDALL

    Senator Udall. Thank you very much, Mr. Chairman.
    I could not agree with you more that the budget on this 
water infrastructure is a step backwards. I look forward to 
working with both the Chair and Ranking on water infrastructure 
that you both talked about in your openings.
    I think if there is going to be an infrastructure package 
that the President has talked about, I think water should be at 
the top of it and be a part of that. So I look forward to 
working with you there.
    I want to thank Mr. Mikkelsen. The Bureau's fiscal year 
2017 spending plan came out last week, as I understand it, and 
it includes some good investments for New Mexico, including $4 
million in additional funding for the Eastern New Mexico Water 
Utility Authority.
    This project has $50 million in shovel-ready work. It is 
just waiting on funds to put people to work, and I look forward 
to working with the Bureau to assure the continued robust 
funding for this project.
    You may not be aware, but of the six rural water projects, 
Eastern New Mexico is the only one that supports our national 
security with 13 percent of the water from this project 
consumed by Cannon Air Force Base. Assuring that the project 
has robust funding is invaluable not only to the communities of 
Clovis, Portales, and Melrose, but also to protect the 
multibillion dollar investment of modernizing Cannon Air Force 
Base. So thank you for that.
    Lieutenant General Semonite and Mr. Lamont, I want to thank 
you for continuing to prioritize reimbursements to entities in 
New Mexico through the Environmental Infrastructure Program. 
This year, the Corps' work provided $1.5 million to reimburse 
three entities: Rio Rancho, Bernalillo County, and the MRGCD 
(Middle Rio Grande Conservancy District).
    But our work is not over; $9 million is still outstanding 
to be paid to these partners, some of which has been waiting 
for reimbursement for over a decade. I know $9 million may not 
sound like a lot, but for these entities like Rio Rancho, 
Bernalillo County, and the MRGCD, I can assure you, it is 
significant.
    Therefore, I hope you will continue to work with me to 
prioritize these reimbursements so these communities can 
reinvest their money in new water and wastewater projects and 
get out of this cycle of borrowing against future funds.
    To each of you, President Trump has been talking about 
sending Congress an infrastructure package since his days on 
the campaign trail. Something in concept almost everyone 
supports and which I just mentioned.
    When many people think of infrastructure, they think of 
roads and bridges, but in rural America, we also know that 
dams, levees, and rural water projects are invaluable 
infrastructure. In fact, it is estimated that the value of the 
Bureau of Reclamation's assets would be $94.5 billion to 
replace, and to replace all our Federal water infrastructure 
would be over $350 billion. Maintenance of these critical 
assets is integral to our water security, fiscal security, and 
national security.
    We also know that for every Federal dollar spent on water 
and wastewater infrastructure--and I mean real dollars not a 
tax break--we generate $6.35 to the GDP (gross domestic 
product).
    Therefore, I hope you will each push the White House to 
include robust funding in any infrastructure proposal for water 
infrastructure and in particular in rural areas which need it.
    Thank you and look forward to my round of questions.
    Senator Alexander. Thank you, Senator Udall.
    Senator Shelby.

                 STATEMENT OF SENATOR RICHARD C. SHELBY

    Senator Shelby. Thank you, Mr. Chairman.
    Mr. Chairman, thank you and Senator Feinstein for the 
leadership you bring here.
    I was struck by the about $8 billion. Was that the right 
figure in the Harbor Maintenance Trust Fund?
    Senator Alexander. I think it is now $9 billion, Senator 
Shelby.
    Senator Shelby. Or more. We have dire needs everywhere, 
everybody here today has a need for infrastructure. I think we 
have to look.
    Chairman Cochran, I hope we have a nice allocation 
ultimately for this Committee, but we ought to look at ways to 
fund these needed projects that we all are pushing for that 
will make this country move things, commerce, much better 
again.
    I ask that my entire statement be made part of the record, 
and I look forward to the hearing.
    [The statement follows:]
            Prepared Statement of Senator Richard C. Shelby
    Thank you Mr. Chairman and Ranking Member Feinstein for convening 
this important subcommittee hearing to review the funding request and 
budget justification for the Army Corps of Engineers and the Bureau of 
Reclamation.
    Mr. Chairman, as you know, the needs for improved water 
infrastructure across the United States is great. Properly maintaining 
our inland waterway systems, ports, and harbors is vital to ensure that 
commerce can continue to flow throughout the Nation. From rural water 
systems to port infrastructure, finding ways to fund these projects 
must continue to be a priority for Congress and the Administration. I 
look forward to working with you and the members of this committee 
during the 115th Congress, and I welcome our distinguished panel of 
witnesses.

    Senator Alexander. Thank you, Senator Shelby. It will be 
made part of the record.
    Senator Shaheen.
    Senator Shaheen. I do not have an opening statement, Mr. 
Chairman.
    Senator Alexander. Thanks, Senator Shaheen.
    Senator Kennedy.
    Senator Kennedy. I pass, Mr. Chairman.
    Senator Alexander. Thank you.
    Senator Tester.

                    STATEMENT OF SENATOR JON TESTER

    Senator Tester. Thank you, Mr. Chairman.
    I want to echo the remarks of Senator Shelby, and thank 
you, and Ranking Member Feinstein for their leadership.
    There are a lot of things in this world that are important, 
but nothing more important than clean water. You can have all 
the assets in the world, but if you do not have clean water, 
you are not moving forward economically or with life itself, 
because water is life.
    In that vein, we have a lot of rural water projects in 
Montana that have been on the books for a long time now. I ran 
for the State legislature 20 years ago and they were on the 
books then, and they are still on the books, and we still have 
a long ways to go for completion on that.
    I know money is a finite resource, but it is going to take 
some dollars to get those done. Whether we can do it within 
budget or with an infrastructure bill, it is critically 
important we move forward on those projects because, quite 
frankly, these folks need clean water.
    The other thing I would just bring up, and we can flesh it 
out more as the committee goes on, is invasive aquatics. The 
zebra mussels and all the bad stuff that is in the water that 
is all around, Montana has just been infected with them. It is 
a big, big issue in a State where our outdoor economy is worth 
$6.4 billion. Where we use that water for irrigation, those 
invasive aquatics really can be harmful.
    I know it is a tough issue, but the truth is we need to 
work together to figure out ways to get our arms around this 
and move forward in a way that these little buggers do not take 
us out.
    So thank you all for being here.
    Senator Alexander. Thanks, Senator Tester.
    We will now recognize our witnesses to give their 
statements, beginning with General Semonite.
    General, you may proceed.

        SUMMARY STATEMENT OF LIEUTENANT GENERAL TODD T. SEMONITE

    General Semonite. Chairman Alexander, Ranking Member 
Feinstein, and distinguished Members of the subcommittee.
    I am Lieutenant General Todd Semonite, Commanding General 
of the United States Army Corps of Engineers and the 54th Chief 
of Engineers.
    I am really honored to be here today accompanied by Mr. 
Lamont to provide testimony on the President's fiscal year 2018 
budget for the Civil Works program for the United States Army 
Corps of Engineers.
    I have been in Command of the Corps for just over a year, 
and I continue to be amazed by the breadth and complexity of 
the Civil Works program, as well as the expertise and 
dedication of the professionals that work in our organization.
    While this is my first time appearing before this 
subcommittee, I have had the opportunity to work with a number 
of you individually and look forward to continuing to build our 
relationship during my tenure as Chief of Engineers.
    It is my belief that the credibility of the Corps is 
measured by our ability to deliver results that are on time, on 
budget, and of exceptional quality.
    To do this--and to maintain our status as a world class 
organization now and into the future--we are focusing on three 
fundamentals we call strengthening our foundation, delivering 
the program, and achieving our vision. I want to give you some 
highlights of those fundamentals.
    As with any structure, our foundation must be our strength, 
the bedrock upon which our present rests and our future is 
built.
    For the Corps, this means having the discipline to 
accomplish routine tasks to a high standard. It means 
demonstrating that we are reliable and competent partners, 
assisting in shared efforts to be responsible stewards of our 
Nation's water resources.
    We are committed to transform our processes, invest in the 
technical competency of our most valued asset, our people, and 
to be collaborative and transparent.
    Our strength is validated by earning trust in all we do by 
demonstrating technical expertise, competence, and 
professionalism across our organization.
    We earn our credibility, our reputation, and our value by 
delivering our program. This is our lifeblood. This is our 
passion. This is our mission. And this is our number one 
priority. In all we do, we strive to ensure that cost, 
timelines, and expected quality are understood upfront and 
accomplished successfully in the end.
    In order to achieve our vision, we endeavor to anticipate 
those conditions, challenges, and opportunities in an uncertain 
future by taking prudent, logical, and decisive steps today to 
prepare. We are doing this by implementing strategic 
transformation within the Corps, continuing pursuing four goals 
outlined within our campaign plan with an aim point of 2025.
    Our first campaign goal is to continue to work across the 
globe with a presence in more than 110 countries supporting 
national security with our combatant commanders in civil works, 
military missions, and water resources.
    We are proud to serve this great Nation and our fellow 
citizens, and we are proud of the work the Corps does to 
support American foreign policy.
    Our second goal is to continue to work in making the Corps 
more efficient and effective while delivering integrated water 
resource solutions for national missions, and to address 
infrastructure challenges. This involves modernizing the 
project planning process, enhancing budget development for more 
holistic outcomes, making better risk informed investment 
decisions, and improving delivery methodology.
    Our third major goal is to continue to be proactive in 
reducing disaster risk and responding to disasters under the 
national response and recovery support framework, as well as 
within our authority for flood risk management. I am very proud 
of our team for the work we do with FEMA and our Federal 
partners, as well as with State and local agencies in this 
area.
    Our fourth and final goal is preparing for tomorrow, which 
focuses on our people and ensuring we have a pipeline of the 
best engineering and technical expertise, as well as a strong 
workforce development and talent management program. We 
continue to tailor developmental programs to employ aspirations 
to retain talent and instill a culture that embraces a career 
of service.
    And on about the fourth row back, we brought in 12 people 
who are emerging leaders from the Corps, so they could sit here 
today and to learn how this process works.
    In closing, I would offer that our excellence demands the 
commitment of every Corps employee. As Chief of Engineers, I am 
striving to develop what General Shinseki, former Army Chief of 
Staff, called irreversible momentum towards being a world class 
organization. World class means for the Corps to continue 
engineering solutions for the Nation's toughest challenges, 
which is our vision.
    We all must be leaders of technical competency and superior 
integrity. You have my commitment that the teammates of the 
Corps have a passion to achieve that vision.
    Thank you for allowing me the time to address the Committee 
today.
    [The statement follows:]
       Prepared Statement of Lieutenant General Todd T. Semonite
    Chairman Alexander, Ranking Member Feinstein and Members of the 
Subcommittee: I am honored to testify before your committee today, 
along with Mr. Douglas Lamont, the Senior Official Performing the 
Duties of the Assistant Secretary of the Army (Civil Works), on the 
President's fiscal year 2018 Budget for the United States Army Corps of 
Engineers (Corps) Civil Works Program. This is my first time to testify 
before this Subcommittee and I look forward to working together during 
my tenure as Chief of Engineers.
    I have been in command of the Corps for just over a year, and I 
want to briefly update you on where we're headed.
    As an organization, the Corps' credibility is measured by our 
ability to deliver results that are on time, on budget, and of 
exceptional quality. To do this, and to keep us ``world class'', now 
and into the future, we're focusing on three fundamentals we call 
``Strengthen the Foundation,'' ``Deliver the Program,'' and ``Achieve 
our Vision.''
    First, as with any structure, our Foundation must be our Strength--
the bedrock upon which our present rests and our future is built. For 
the Corps, this means having the discipline to do the routine things to 
a high standard. It means demonstrating we are reliable and worthy 
partners to assist in a shared effort by all levels of government and 
the private sector to be responsible stewards of our Nation's water 
resources--and to earn its trust--in all we do, from top to bottom, big 
to small, tactical to strategic. It means having teams and processes 
that ask and answer the right questions, like, ``do we have the 
capabilities, capacity, and authorities,'' before we launch. And, it 
means empowering leaders to think strategically because they are 
confident in the discipline of our ranks.
    Second, we earn our credibility, our reputation, and our value by 
Delivering the Program. This is our lifesblood. This is our passion. 
This is our mission. And this is our No. 1 priority. In all we do, 
we'll ensure that costs, milestones, and expected quality are both 
understood and met.
    Finally, to Achieve our Vision, we'll do our best to anticipate the 
conditions, challenges, and opportunities in an unknowable future and 
take prudent, decisive steps today to prepare. We're doing this by 
operationalizing strategic change with our Campaign Plan and its four 
(4) Goals--Support National Security, Deliver Integrated Water Resource 
Solutions, Reduce Disaster Risk, and Prepare for Tomorrow.
    First, we continue our work across the globe with presence in more 
than 110 countries Supporting National Security and our Combatant 
Commanders with Civil Works, Military Missions, and Water Resources 
Research and Development expertise. 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. Corps civilian employees 
nationwide have volunteered--and continue to volunteer--to support our 
Nation's missions and vital interests abroad, often in harm's way. Many 
have served on multiple deployments.
    Second, we continue to work at making the Corps more efficient and 
effective while Delivering Integrated Water Resource Solutions for 
national missions and to address infrastructure challenges. This 
involves modernizing the project planning process, enhancing budget 
development for more holistic outcomes, making better risk-informed 
investment decisions, and improving delivery methods.
    Third, we continue to be proactive in Reducing Disaster Risks and 
responding to disasters under the National Response Framework, National 
Disaster Recovery Framework, Public Law 84-99 as amended, and Corps 
project authorities for flood risk management. I am so proud of our 
team for the work we do with our partners at FEMA and State and local 
agencies in this area.
    Fourth, Preparing for Tomorrow remains about our people and 
ensuring we have a pipeline of the best Science, Technology, 
Engineering and Mathematics teammates, as well as strong Workforce 
Development and Talent Management programs. We continue to tailor 
development programs to employee aspirations to retain talent and 
instill a culture that embraces a career of service. We've enjoyed 
success here, and continue to significantly improve our agency ranking 
in the Federal Employee Viewpoint Survey and on the list of best places 
to work in the Federal Government. We are proud to say that we continue 
to help our Nation's Wounded Warriors transition out of active duty 
into fulfilling careers. In fact, this year we set a goal to assist 225 
transitioning Wounded Warriors. I'm proud to say that we've nearly 
reached this goal by assisting 185 Wounded Warriors through the end of 
the 2nd quarter. Over the past 5 years, we've helped just over 1,300 
Wounded Warriors find meaningful careers within the Corps and other 
organizations.
    In closing, may I say that our excellence demands the bone-deep 
commitment of every Corps employee. I'm striving to develop what GEN 
Shinseki, former Army Chief of Staff, called ``irreversible momentum'' 
toward being a ``world-class'' organization. I use those two words on 
purpose because when I talk with my Corps team, I want all of us to 
have something to relate to. Whether a regulatory biologist or 
construction engineer, a human resource specialist or dam operator, an 
administrative professional or general officer, ``world class'' means 
that for the Corps to continue ``engineering solutions to the nation's 
toughest challenges,'' which is our vision, we all must be leaders of 
superior integrity and technical competence. We know our multi-billion 
program doesn't deliver itself. Nor is the Nation served just by the 
work that we do, but more importantly, by your entire Corps Team--
34,000 strong. Thank you for allowing me the time to address the 
committee.
                   summary of fiscal year 2018 budget
    The fiscal year 2018 Civil Works Budget is a performance-based 
budget, and reflects a focus on the work that will provide high 
economic and environmental returns to the Nation or address a 
significant risk to safety. Investments by the Civil Works program will 
reduce the risks of flood impacts in communities throughout the Nation, 
facilitate commercial navigation, restore and protect aquatic 
ecosystems, generate low-cost renewable hydropower, and support 
American jobs. Continued investment in critical Civil Works 
infrastructure projects is an investment in the Nation's economy, 
security, and quality of life--now and in the future.
    The Budget focuses on high-performing projects and programs within 
the three main water resources missions of the Corps: commercial 
navigation, flood and storm damage reduction, and aquatic ecosystem 
restoration. The fiscal year 2018 Budget includes $5.002 billion in 
gross discretionary funding for Civil Works activities throughout the 
Nation, including the construction of water resources projects that 
will provide high economic, environmental and public safety returns on 
the Nation's investment.
    The Budget also proposes the necessary level of funding for the 
Regulatory program to protect and preserve water-related resources of 
the Nation.
                         investigations program
    The fiscal year 2018 Budget provides $86 million in the 
Investigations account, and $3 million in the Mississippi River and 
Tributaries account to evaluate and design projects within the Corps 
three main mission areas and for related work, including some research 
and development. The Budget also supports the Corps planning and 
technical assistance programs, including using its expertise to help 
local communities increase their resilience to, and preparedness for, 
flood risks such as the flood risks in coastal communities.
                          construction program
    The Budget provides $1.02 billion for the construction program in 
the Construction account, and $108 million in the Mississippi River and 
Tributaries account, prioritizing projects with a high net economic, 
environmental and safety return to the Nation per dollar invested, as 
well as projects that address a significant risk to safety.
    The goal of the construction program is to produce as much value as 
possible for the Nation from the available funds. The Corps uses 
objective performance measures to allocate this funding. For projects 
that are being funded primarily due to their economic return, these 
include benefit-to-cost ratios. For projects funded on the basis of 
their environmental return, priority is given to those projects that 
are highly effective at restoring degraded structures, functions or 
processes of aquatic ecosystems on a cost- effective basis as well as 
mitigation or environmental requirements. The selection process also 
prioritizes investments, on a risk informed basis, in dam safety 
assurance, seepage control, static instability correction work at dams 
that the Corps owns and operates.
                operation and maintenance (o&m) program
    All structures age and can deteriorate over time, causing a 
potential decline in reliability. As stewards of a large portfolio of 
water resources infrastructure, we are working to ensure that its key 
features continue to provide appropriate levels of service to the 
American people.
    The Corps is working to improve the efficiency and effectiveness of 
its operation and maintenance program. The Budget focuses on 
investments that address infrastructure maintenance needs on a risk 
assessment basis. In fiscal year 2018, the Corps will further expand 
the implementation of a modern asset management program, dedicating an 
increased amount of its O&M funding to the key features of its 
infrastructure and for work that will reduce long-term O&M costs in 
real terms. The Budget also supports an energy sustainability program 
and pursues efficiencies in the acquisition and operation of our 
information technology.
    The Budget for the operation and maintenance program provides $3.1 
billion in the O&M account, and $142 million in the Mississippi River 
and Tributaries account, with a focus on the operation and maintenance 
of key commercial navigation, flood risk management, hydropower and 
other facilities. The Budget gives priority to coastal ports and inland 
waterways with high levels of commercial traffic, and includes $965 
million for work financed through the Harbor Maintenance Trust Fund. 
The Budget also funds some small ports, including an emphasis on those 
that support significant commercial fishing, subsistence, or public 
transportation benefits. The Budget provides O&M funding for safety 
improvements at the dams and levees that the Corps owns and operates 
based on the risk and consequence of a failure. According to our 
analyses, 297 of the 715 dams in our current inventory have either 
already had some form of modification, or an interim risk reduction 
measure, or may require them over the next 50 years, if they are to 
continue to serve their authorized purposes. Additional measures are 
considered and evaluated as new and existing issues are identified.
    Generally, the O&M program supports completed works owned or 
operated by the Corps, including administrative buildings and 
laboratories. Work to be accomplished includes: operation of locks and 
dams along the inland waterways; dredging of inland and coastal Federal 
channels; operating multi-purpose dams and reservoirs for flood risk 
reduction, hydropower, recreation, and related purposes; maintenance 
and repair of facilities; monitoring of completed projects; and general 
management of Corps facilities and the land associated with these 
purposes including work to serve as a responsible steward of the 
resources on Corps lands.
    The fiscal year 2018 Budget provides $243 million in the O&M 
account for hydropower activities in order to maintain basic power 
components such as generators, turbines, transformers and circuit 
breakers at Corps hydropower facilities to keep them operating 
efficiently and effectively. The Corps is the largest hydropower 
producer in the U.S., operating 24 percent of the Nation's hydropower 
capacity.
                          reimbursable program
    Through the Interagency and International Services (IIS) 
Reimbursable Program, the Corps assists other Federal agencies, State, 
local, Tribal governments, and those of other countries with timely, 
cost-effective solutions. These agencies can turn to the Corps, which 
already has these capabilities, rather than develop their own internal 
workforce and expertise to act as their design and construction agent. 
Such intergovernmental cooperation is effective for agencies and the 
taxpayer, and uses the skills and talents that we bring from our Civil 
Works and Military Missions programs.
    The work is principally technical oversight and management of 
engineering, environmental, and construction projects. The the work 
itself is typically performed by private sector firms and is financed 
by the agencies we service. IIS Reimbursable Program activities in 
support of our domestic stakeholders totaled $1.04 billion in fiscal 
year 2016. We only accept agency requests that are consistent with our 
core technical expertise, in the national interest, and that can be 
executed without impacting our primary mission areas.
                          emergency management
    The fiscal year 2018 Budget provides $35 million in funding for the 
Flood Control and Coastal Emergencies account to enable the Corps to 
prepare for emergency operations in response to natural disasters. The 
Budget for the emergency management program also includes $5.5 million 
for the National Emergency Preparedness Program--an increase of $1 
million from prior years.
    An additional $3 million is included in the Investigations account 
for the Corps participation in the development and expansion of 
intergovernmental teams, known as Silver Jackets, which collaboratively 
reduce the risks associated with flooding and other natural hazards. 
The Silver Jackets program is an innovative program, which provides a 
national forum to address State and local flood risk management 
priorities. Each team is developed at the State level. The teams share 
lessons learned at the State level with each other, and each team works 
to apply the available Federal and State resources effectively to meet 
its State's flood risk management priorities. There are now 48 active 
teams (47 States and the District of Columbia); our goal is to have a 
Silver Jackets team for every State. The Flooplain Management Program 
of the Corps complements this effort by providing technical assistance.
                               conclusion
    The fiscal year 2018 Budget represents a continuing, fiscally 
prudent investment in the Nation's water resources infrastructure and 
restoration of its aquatic ecosystems. The U.S. Army Corps of Engineers 
is committed to a performance-based Civil Works Program, based on 
innovative, resilient, and sustainable risk-informed solutions.
    Thank you for the opportunity to testify today. This concludes my 
statement. I look forward to answering any questions you or other 
Members of the Subcommittee may have.

    Senator Alexander. Thank you, sir.
    And welcome to the emerging leaders. We hope being exposed 
to sausage making in this stage of their careers does not 
discourage them, but we welcome and appreciate their 
leadership.
    Mr. Lamont.
STATEMENT OF HON. DOUGLAS W. LAMONT, SENIOR OFFICIAL 
            PERFORMING THE DUTIES OF THE ASSISTANT 
            SECRETARY OF THE ARMY (CIVIL WORKS)
    Mr. Lamont. Good afternoon, Mr. Chairman, Ranking Member 
Feinstein, Chairman Cochran, and subcommittee Members.
    My name is Doug Lamont. I am the Senior Official performing 
the duties of the Assistant Secretary of the Army for Civil 
Works.
    Thank you, Chairman Alexander and distinguished Members for 
the opportunity to present the President's budget for the Civil 
Works program in the Army Corps of Engineers.
    I am honored to be here with General Semonite, our Chief of 
Engineers and to also be a former 32 year member of the Corps 
of Engineers myself.
    This year's Civil Works budget reflects the 
Administration's priorities through targeted investments that 
will reduce the flood impacts to our communities, facilitate 
waterborne transportation, restore aquatic ecosystems, and 
support American jobs.
    The budget prioritizes funding for operations and 
maintenance of water resources infrastructure by providing $3.1 
billion in the Operations and Maintenance account, and $142 
million for operation and maintenance in the Mississippi River 
and Tributaries program.
    Funding for maintaining commercial navigation, flood and 
storm damage reduction, and hydropower projects are informed by 
assessments that are risk-based on project condition and on the 
consequences of failure.
    The budget includes $765 million for operations and 
maintenance of inland navigation projects, and $654 million for 
operation and maintenance of Flood Risk Management Projects, 
excluding the remaining items. These funding levels will enable 
continued reduction of unscheduled lock closures due to 
preventable mechanical breakdowns and reduce flood risk at our 
Flood Risk Management Projects.
    The budget provides $965 million from the Harbor 
Maintenance Trust Fund to maintain coastal channels and related 
work, which is the highest amount ever budgeted.
    The budget supports a Corps program that has a diverse set 
of tools and approaches to working with local communities, 
whether this means building, funding our projects with our cost 
share partners, or providing planning assistance and technical 
expertise to help communities make better informed decisions.
    Other funded Corps efforts include mitigation of impacts to 
fish in the Columbia River Basin and priority work on the Upper 
Mississippi and Missouri Rivers.
    I look forward to working with the Committee to advance the 
Army's Civil Works program.
    I would be remiss if I did not take this opportunity to 
express my appreciation for Mr. Let Mon Lee here, who is 
retiring on July 3 after 39 years of Federal service. My 
appreciation to Let Mon.
    Thank you very much, Mr. Chairman.
    [The statement follows:]
             Prepared Statement of Douglas W. Lamont, P.E.
    Thank you Chairman Alexander and distinguished members of the 
subcommittee for the opportunity to present the President's Budget for 
the Civil Works program of the Army Corps of Engineers for fiscal year 
2018. The President's Budget for fiscal year 2018 for the Civil Works 
program of the Army Corps of Engineers funds the development, 
restoration, and protection of the Nation's water, wetlands, and 
related resources, through studies, construction, and operation and 
maintenance of projects, the Corps regulatory program, the cleanup of 
certain sites contaminated as a result of the Nation's early atomic 
weapons development program, and emergency response preparedness. The 
Budget focuses on high performing work within the three main water 
resources missions of the Corps: commercial navigation, flood and storm 
damage reduction, and aquatic ecosystem restoration.
    The Civil Works program, which this Budget supports, relies on 
strong relationships between the Corps and local communities; these 
strong relationships allow us to work together to meet water resources 
needs across all of our missions.
    The Budget provides $5.002 billion in discretionary funding for the 
Civil Works program, including approximately $2.098 billion to support 
commercial navigation; $1.37 billion for flood and storm damage 
reduction; and $335 million for aquatic ecosystem restoration. Of these 
amounts, $965 million would be derived from the Harbor Maintenance 
Trust Fund and $26 million would be derived from the Inland Waterways 
Trust Fund.
    The Budget prioritizes funding to operate and maintain water 
resources infrastructure by providing $3.1 billion in the Operation and 
Maintenance account, and $142 million for operation and maintenance in 
the Mississippi River and Tributaries account. Our funding allocations 
for the maintenance of commercial navigation, flood and storm damage 
reduction, and hydropower projects are informed by assessments of risk 
based on project condition and the consequences of a failure.
    The Budget includes $765 million for operation and maintenance of 
inland navigation projects and $654 million for operation and 
maintenance of flood risk management projects, excluding remaining 
items. These funding levels will enable continued reduction of 
unscheduled lock closures due to preventable mechanical breakdowns and 
reduced risk at flood risk management projects.
    The Budget provides $965 million to be derived from the Harbor 
Maintenance Trust Fund (HMTF) to maintain coastal channels and related 
work, which is the highest amount ever budgeted, consisting of $923 
million from the Operation and Maintenance account, $5 million from the 
Mississippi River & Tributaries account, and $37 million from the 
Construction account.
    The Budget provides $1.020 billion in the Construction account, and 
$108 million in the Mississippi River and Tributaries account 
prioritizing projects with a high net economic, environmental, and 
safety return to the Nation. The Budget continues to include efficient 
funding for the Olmsted Locks and Dam project at $175 million and 
proposes a new user fee to produce additional revenue to help finance 
future inland waterways navigation capital investments to support 
economic growth. This is necessary because the current excise tax on 
diesel fuel used in inland waterways commerce will not produce the 
revenue needed to cover anticipated future investment needs.
    The Budget also includes $299 million (including $34 million for 
the Dam Safety remaining item) for the dam safety program. When coupled 
with anticipated unobligated carryover balances on these important 
projects, this funding will enable the Corps to evaluate and implement 
effective risk reduction strategies at our dams where needed.
    The Budget provides $86 million in funding for the Investigations 
account, and $3 million for investigations in the Mississippi River and 
Tributaries account.
    The Budget focuses on bringing ongoing studies to a conclusion. The 
Budget funds to completion 26 ongoing feasibility studies and includes 
$15 million for Floodplain Management Services and $5 million for the 
Planning Assistance to States program to provide local communities with 
technical and planning assistance to enable them to reduce their flood 
risk, with emphasis on non-structural approaches.
    All feasibility studies funded in the Budget have signed 
Feasibility Cost-Sharing Agreements, and have developed a plan that 
outlines their scope, schedule, and cost, which has been agreed upon by 
the District, Division, Corps Headquarters, and the local sponsor.
    The Budget also includes funds to complete the Loxahatchee River 
Watershed Study within the South Florida Everglades Restoration 
program.
    Lastly, the Budget includes a proposed provision to divest the 
Washington Aqueduct. The Washington Aqueduct is the only local water 
supply system in the Nation owned and operated by the Corps. Ownership 
of local water supply is best carried out by State or local government 
or the private sector where there are appropriate market and regulatory 
incentives. The proposal to eliminate the Corps' role in local water 
supply and increase the State/local/private sector's role would 
encourage a more efficient allocation of economic resources and 
mitigate risk to taxpayers.
    Thank you all for inviting me to attend today on behalf of the 
Administration. General Semonite will provide further remarks on the 
Army Civil Works 2018 Budget.

    Senator Alexander. Thank you very much.
    Mr. Mikkelsen, welcome.

                       DEPARTMENT OF THE INTERIOR


                         Bureau of Reclamation

STATEMENT OF HON. ALAN MIKKELSEN, ACTING COMMISSIONER
    Mr. Mikkelsen. Thank you, Mr. Chairman, Ranking Member 
Feinstein, and Chairman Cochran, Members of the subcommittee.
    Thank you for the opportunity to discuss with you the 
President's budget for the Bureau of Reclamation.
    I am Alan Mikkelsen, Acting Commissioner.
    Reclamation's fiscal year 2018 budget allocates funds to 
projects and programs based on objective performance based 
criteria. This allows us to most effectively administer 
Reclamation's responsibilities for our water and power 
infrastructure in the west.
    By doing so, the Bureau has become a leader in efforts to 
improve western water management, confront growing imbalances 
in water supply and demand, address past environmental harms, 
and engage in efforts to adapt to increased uncertainty.
    Our budget continues to emphasize the following principles. 
First, share responsibility through collaborative partnerships 
with non-Federal partners.
    Second, merit-based funding through the awarding of grants 
and contracts based on published criteria. The selection of 
awards is guided by high quality evidence-based research and 
performance measures.
    Third, the importance of increased storage capacity. The 
Bureau recognizes the important goal of increasing and 
improving storage where it is both feasible and where there is 
significant stakeholder support.
    I believe we will continue to do great things if this 
budget is funded.
    Let me take a moment to provide you with an understanding 
and an overview of some of the exciting projects that we have 
underway.
    In our Great Plains region, home to Senators Hoeven and 
Tester, we continue collaborating with our stakeholders to 
manage, develop, and protect water resources throughout the 
region, as well as promote drought resiliency.
    Reclamation also continues to provide safe and reliable 
drinking water to Native American Tribes and rural communities. 
Moreover, through our rural water program, Reclamation has 
helped these communities build the foundation for future 
economic development and job creation.
    In the Upper Colorado region, home to Senator Udall, we 
request funding for two Indian water rights settlement 
projects, the Navajo-Gallup Water Supply Project and the Aamodt 
Litigation Settlement.
    These settlements provide permanent water supplies by 
building and improving the water systems for sustainable 
municipal, industrial, and domestic water supplies in these 
communities. And of course, the Upper Colorado is home to Glen 
Canyon Dam and beautiful Lake Powell.
    The Lower Colorado region encompasses the Lower Colorado 
River Basin that is home to Hoover Dam and includes some of 
Senator Feinstein's State of California.
    Given the ongoing drought in the southwest, the priority 
focus here is the annual delivery of 7.5 million acre feet of 
water to Arizona, California, and Nevada and another 1.5 
million acre feet to New Mexico. Nearly 80 percent of this 
region's budget is either paid for directly by our partners or 
through the sale of hydropower generation.
    In addition to struggling with the worst drought in more 
than 100 years, the region is looking at additional ways to 
assist California with their implementation of other important 
water irrigation and conservation infrastructures, particularly 
around the Salton Sea area.
    The mid-Pacific region--home to the rest of Senator 
Feinstein's State and a part of Senator Merkley's Oregon--has 
suffered from its own unique set of drought-related problems. 
Recent precipitation has alleviated some emergency water supply 
issues, but one good year will not solve all problems related 
to a multiyear drought.
    Additionally, recent heavy rains have caused flooding 
concerns and have highlighted the importance of maintaining 
Reclamation's infrastructure. The region works with a diverse 
group of stakeholders to implement water solutions with the 
goal of balancing human and environmental needs for water.
    Finally, there is the Pacific Northwest region, home to 
Grand Coulee Dam, one of the largest hydropower facilities in 
the world. This region encompasses Senator Murray's Washington, 
the rest of Senator Merkley's Oregon, and Idaho.
    Our focus here for the coming year will be on the continued 
construction of the Cle Elum Fish Passage as part of Washington 
State's Yakama Integrated Plan, as well as continuing to manage 
and develop the Columbia Basin project, one of the Nation's 
most critical sources for sustained agriculture.
    Moreover, Reclamation's Safety of Dams work, which is 
ongoing in Oregon's Scoggins, Hyatt, and Howard Prairie Dams 
remain critical to the Bureau's overall mission and ensures our 
ability to store water and generate hydropower for future 
generations.
    Additionally, Reclamation provides continued flood control, 
forecasting, water conservation activities related to the 
authorized use of water, pest management, environmental audits, 
and recreational management for areas of Bureau lands within 
all of our areas.
    Finally, we will implement multiple biological opinion 
actions as part of the Columbia and Snake River Salmon Recovery 
as well as in California operating under various authorities. 
These actions support ecosystem restoration and enhanced 
Reclamation's initiatives in the area of environmental 
recovery.
    I again thank the committee and am prepared to answer 
questions you have about the Bureau's fiscal year 2018 budget 
request.
    Thank you, Mr. Chairman.
    [The statement follows:]
                  Prepared Statement of Alan Mikkelsen
    Thank you, Chairman Alexander, Ranking Member Feinstein, and 
members of this Subcommittee for the opportunity to discuss with you 
the President's fiscal year 2018 Budget for the Bureau of Reclamation. 
I am Alan Mikkelsen, the Acting Commissioner of the Bureau of 
Reclamation.
    Reclamation's fiscal year 2018 Budget sustains Reclamation's 
efforts to deliver water and generate hydropower, consistent with 
applicable State and Federal law, in a cost-efficient and 
environmentally responsible manner. It also supports the Administration 
and Department of the Interior (Department) goals of ensuring the 
efficient generation of energy, provision of secure water supplies, 
varied use of our resources, celebration of America's recreation 
opportunities, and fulfilling our commitments to tribal nations.
    Reclamation's fiscal year 2018 budget allocates funds to projects 
and programs based on objective, performance-based criteria to most 
effectively administer responsibilities for our water and power 
infrastructure in the West. It has been said that Reclamation is a 
leader in efforts to improve western water management, confront growing 
imbalances in water supply and demand, address environmental effects of 
its projects, engage in efforts to adapt to increased uncertainty, and 
manage water-supply risk and public safety.
    Our budget request continues this year to emphasize the following 
two principles:
  --First, Shared Responsibility through collaborative partnerships 
        with non-Federal partners, and
  --Second, Merit-Based Funding through the awarding of grants and 
        contracts based on published criteria. The selection of awards 
        is guided by high-quality, evidence-based research and 
        performance measures.
    Reclamation is requesting a net total of $1,056,017,000 in 
discretionary appropriations, which is anticipated to be leveraged by 
approximately $850 million in other Federal and non-Federal funds for 
fiscal year 2018. This reflects a decrease of 13.1 percent from the 
fiscal year 2017 annualized continuing resolution total discretionary 
funding of $1,262,596,000. Of the total, $960,017,000 is for the Water 
and Related Resources account, which is Reclamation's largest account; 
$59,000,000 is for the Policy and Administration account; $37,000,000 
is for the California Bay Delta Restoration account; and $41,376,000 is 
for the Central Valley Project Restoration Fund.
    Reclamation's mission is to deliver water and power in an 
economically and environmentally sustainable manner in the interest of 
the American public. As such, it has designed the infrastructure it 
manages to account for future uncertainties related to water supplies, 
competing water needs, and significant variability in weather 
conditions from year to year. The robustness of the water system is 
tested through droughts and floods. Historically high precipitation 
throughout much of the Western United States--in particular in 
California during late 2016 and early 2017--is providing for a much 
improved outlook for water supplies as compared to recent drought 
stricken years. Even during these times there remain portions of the 
West that are still abnormally dry or in moderate drought. 
Additionally, long-term impacts from droughts and multi-year droughts, 
such as those in the Colorado River Basin, are not recovered in a 
single wet year.
    Hydropower production is vulnerable to altered water availability 
resulting from weather variation.Reclamation must be in a position to 
manage through drought. Additionally, Reclamation must ensure that its 
infrastructure can appropriately handle the wet period and floods 
currently being experienced. The investments described in Reclamation's 
fiscal year 2018 budget will further these efforts.
    Reclamation's dams, water conveyances, and power generating 
facilities are integral components of the Nation's infrastructure. 
Effectively managing the benefits provided by these structures is among 
the many significant challenges that Reclamation faces, over the next 5 
years and beyond, in its ability to achieve progress in the areas of 
certainty, sustainability and resiliency with respect to water 
supplies. Increasing population and competing demands are increasingly 
impacting already strained systems. Reclamation's water and power 
projects and activities throughout the western United States are not 
only foundational for essential and safe water supplies for both 
agricultural and municipal and industrial purposes, but also provide 
renewable energy in the form of hydropower, and sustain ecosystems that 
support fish and wildlife, recreation, and rural economies.
    Reclamation's budget includes a substantial request for Indian 
water rights settlements, continuing the high priority of this program 
to meet trust and treaty obligations. With the passage of the Water 
Infrastructure Improvements for the Nation Act (Public Law 114-322) 
(WIIN), the Blackfeet Water Rights Settlement will require significant 
funding in order to meet the settlement's enforcement date of January 
21, 2025. The fiscal year 2018 Budget includes $10 million for this 
settlement.
    Reclamation is continuing its efforts to strengthen its evidence-
based decisionmaking in various program components. This includes the 
WaterSMART program, science and technology, precipitation variability 
adaptation strategies, and the improved planning of future Indian water 
rights settlements. This effort demonstrates the effectiveness, 
efficiency, and innovation of in Reclamation programs.
    Reclamation's projects and programs are foundational to driving and 
maintaining economic growth in hundreds of river basins throughout the 
western States. Reclamation manages water for agricultural, municipal 
and industrial use and also provides flood control and recreation for 
millions of people. Reclamation operates 53 hydroelectric power plants 
that account for 15 percent of the hydroelectric capacity and 
generation in the United States. Annually, Reclamation generates 37 
billion kilowatt hours of electricity, enough to meet the annual needs 
of over 3.5 million households, and collects over $1.0 billion in gross 
revenues for the Federal government. Reclamation's activities, 
including recreation benefits, provide an economic contribution of 
$48.1 billion, and support approximately 388,000 jobs.
    This budget is focused on meeting the Secretary's priorities on 
sharing and multi-use of our nation's natural resources. This is 
balanced with fulfilling Indian water rights obligations, creating 
jobs, ecosystem restoration in the California Bay-Delta and San Joaquin 
River, and maintaining sustainable, secure water supplies. In order to 
meet Reclamation's mission goals, its programs must build a better 
understanding of our resources and the protection and restoration of 
the aquatic and riparian environments influenced by its operations. 
Ecosystem restoration involves a large number of activities, including 
Reclamation's Endangered Species Act recovery programs and river 
restoration projects, which directly address the environmental aspects 
of the Reclamation mission.
                         account level details
    The fiscal year 2018 budget for Reclamation totals $1.097 billion 
in gross budget authority. The budget is partially offset by 
discretionary receipts in the Central Valley Project Restoration Fund 
($41.4 million) resulting in net discretionary budget authority of 
$1.056 billion.
               water and related resources--$960,017,000
    The fiscal year 2018 Water and Related Resources budget provides 
funding for five major program activities--Water and Energy Management 
and Development ($313.7 million), Land Management and Development 
($44.2 million), Fish and Wildlife Management and Development ($153.0 
million), Facility Operations ($296.0 million), and Facility 
Maintenance and Rehabilitation ($153.2 million). The funding proposed 
in Reclamation's fiscal year 2018 Budget supports key programs 
important to the Department and in line with Administration objectives. 
These programs include:
    Infrastructure: The proposed budget includes $51.7 million for 
various Extraordinary Maintenance projects and activities across 
Reclamation. This budget is central to mission objectives of operating 
and maintaining projects to ensure delivery of water and power 
benefits. Reclamation's Extraordinary Maintenance budget is part of its 
overall Asset Management Strategy that relies on condition assessments, 
condition/performance metrics, technological research and deployment, 
and strategic collaboration to continue to improve the management of 
its assets and deal with its aging infrastructure challenges. 
Reclamation seeks to strategically leverage this budget; additional 
Extraordinary Maintenance items are directly funded by revenues, 
customers, or other Federal agencies.
    Dam Safety: The safety and reliability of Reclamation dams is one 
of Reclamation's highest priorities. The Dam Safety Program is critical 
to effectively manage risks to the downstream public, property, 
projects, and natural resources. The $88.1 million requested for the 
Safety of Dams Evaluation and Modification Program provides for risk 
management activities at Reclamation's high and significant hazard dams 
where loss of life or significant economic damage would likely occur if 
the dam were to fail. The budget also includes preconstruction and 
construction activities for several ongoing and planned Dam Safety 
modifications. In addition, funding is included in Reclamation's budget 
for the Department of the Interior's Dam Safety Program.
    Reclamation utilizes the Safety of Dams Act to address dam safety 
issues related to new hydrologic, seismic or change in state-of-the-art 
design and construction practices. Approximately 50 percent of 
Reclamation's dams were built between 1900 and 1950, and approximately 
90 percent of the dams were built before currently used state-of-the-
art design and construction practices were put in place. Continued safe 
performance is paramount and requires an emphasis on the risk 
management activities provided by the program.
    Reclamation's efforts to address the West's water challenges are 
also accomplished through the WaterSMART program--Sustain and Manage 
America's Resources for Tomorrow. At $59.1 million, WaterSMART helps to 
achieve sustainable water management and maintain economic productivity 
in the western United States. It addresses current and future water 
shortages, including drought; degraded water quality; increased demands 
for water and power from growing populations and energy needs; 
amplified recognition of environmental water requirements; and the 
potential for decreased water supply availability due to hydrologic 
variability.
    In order to fully support the 17 Western States, ecosystem 
restoration is a key underpinning of Reclamation's mission. Ecosystem 
restoration involves a number of Reclamation's activities, including 
Reclamation's Endangered Species Act recovery programs, which directly 
address the environmental aspects of the Reclamation mission. Other 
programs that contribute towards this objective include the Columbia/
Snake River Salmon Recovery Program, the Middle Rio Grande Project 
Collaborative Program and the Multi-Species Conservation Program within 
the Lower Colorado River Operations Program.
    Tribal Nations: Reclamation supports tribal nations through a 
number of its projects and programs that range from endangered species 
recovery, to rural water supply, to performing its role, as designated 
by Congress and the Secretary of the Interior, in implementation of 
enacted water rights settlements. Reclamation also strives to improve 
coordination and application of expertise to analyze potential Indian 
water settlements more effectively and expediently. fiscal year 2018 
funding will strengthen Department-wide capabilities in the Secretary's 
Indian Water Rights Office to achieve an integrated and systematic 
approach to Indian water rights negotiations to consider the full range 
of economic, legal, and technical attributes of proposed settlements.
    The fiscal year 2018 budget requests discretionary funds to 
continue the implementation of two of the four Indian Water Rights 
Settlements enacted in December 2010 (Crow and Aamodt), as well as the 
Navajo-Gallup Water Supply Project authorized in 2009. In addition, 
Reclamation proposes including $10.0 million as the first contribution 
for the Blackfeet Water Rights Settlement enacted in December 2016. 
fiscal year 2016 appropriations completed discretionary funding 
requirements for the Taos settlement and mandatory funds will be used 
to implement the White Mountain Apache settlement authorized in the 
Claims Resolution Act. Funding to support tribal nations is also 
included within a number of projects, including the Mni Wiconi Project 
for required tribal operation and maintenance ($13.5 million), the Nez 
Perce Settlement within Columbia and Snake River Salmon Recovery 
Project ($6.2 million), the San Carlos Apache Tribe Water Settlement 
Act ($1.6 million), and the Ak Chin Indian Water Rights Settlement Act 
($16.2 million).
    Research and Development: Reclamation has identified several key 
areas for investment where coordination with other Departmental bureaus 
will leverage results to more effectively achieve mission outcomes. 
Reclamation's fiscal year 2018 budget for research and development 
(R&D) programs include both Science and Technology, and Desalination 
and Water Purification--both of which focus on Reclamation's mission of 
water and power deliveries. Scientific and engineering innovation 
promotes sustainable economic growth and job creation, supports 
maintaining and improving our water and power infrastructure, spurs 
continued production of energy resources, sustains reliable water and 
power delivery to our customers, improves safety, limits the impacts of 
invasive species and ensures we can meet our environmental compliance 
responsibilities. These activities support the Administration's 
priorities for the fiscal year 2018 Budget, including job creation by 
supporting technology transfer activities that lead to new business 
opportunities for private industry. The program is also supporting 
research to address Administration priorities related to maintaining 
and improving our water and power infrastructure by partnering with the 
U.S. Army Corps of Engineers to foster research projects to develop 
technologies that extend the operating life and reduce maintenance 
costs of Reclamation's structures. The Administration priority related 
to energy from all sources is supported by research that ensures we are 
maximizing reliability, reducing maintenance costs, and exploring new 
energy development opportunities. Research on safety is ensuring our 
workers can perform their jobs safely and securely with some projects 
supported through partnership with the Office of Naval Research. The 
Desalination and Water Purification program priorities include 
development of improved and innovative methods of desalination, 
incorporating efficient water-energy nexus solutions into desalination 
processes, and reducing the costs in order to expand new water supplies 
in a sustainable manner and thereby relieve stress on drought stricken 
communities, Western rural communities, Native Americans, and Western 
river basins. The research and testing funded out of this program 
supports the Administration's priorities for the fiscal year 2018 
Budget, including job creation by supporting innovative new solutions 
that spur the creation of new businesses by entrepreneurs and advances 
our competitive edge in the area of water treatment and desalination.
      central valley project restoration fund (cvprf)--$41,376,000
    This fund was established by the Central Valley Project Improvement 
Act, Title XXXIV of Public Law 102-575, October 30, 1992. The budget of 
$41.4 million is expected to be offset by discretionary receipts 
totaling $41.4 million, which is the maximum amount that can be 
collected from project beneficiaries under provisions of Section 
3407(d) of the Act. The discretionary receipts are adjusted on an 
annual basis to maintain payments totaling $30.0 million (October 1992 
price levels) on a 3-year rolling average basis. The reduction is the 
result of the 3-year rolling average provision and the lower 
collections scheduled in fiscal year 2018. The budget of $41.4 million 
for the CVPRF was developed after considering the effects of the San 
Joaquin River Restoration Settlement Act (Public Law 111-11, March 30, 
2009) which redirects certain fees, estimated at $2.0 million in fiscal 
year 2018, collected from the Friant Division water users to the San 
Joaquin Restoration Fund.
           california bay-delta restoration fund--$37,000,000
    The 2004 California Bay-Delta Restoration Act authorized multiple 
Federal agencies to participate in the implementation of the California 
Federal (CALFED) Bay-Delta Program as outlined in the August 28, 2000, 
Record of Decision (ROD) for the CALFED Bay-Delta Program Programmatic 
Environmental Impact Statement and Environmental Impact Report. This 
legislation directed the implementing agencies to undertake a set of 
broadly described programmatic actions identified in the ROD to the 
extent authorized under existing law. In addition, the Act authorized 
$389.0 million in Federal appropriations for new and expanded 
authorities. The Water Infrastructure Improvement for the Nation Act 
(Public Law 114-322) dated December 16, 2016 reauthorized the CALFED 
Bay Delta Authorization Act through fiscal year 2019.
    The fiscal year 2018 Budget of $37.0 million implements 
Reclamation's priority activities pursuant to the Act. This budget 
supports actions in the Interim Federal Action Plan under the following 
program activities: $2.2 million for Renewed Federal State Partnership, 
$4.7 million for Smarter Water Supply and Use, and $30.1 million to 
address the Degraded Bay Delta Ecosystem.
                 policy and administration--$59,000,000
    The $59 million budget will be used to: 1) develop, evaluate, and 
direct implementation of Reclamation-wide policy, rules, and 
regulations, including actions under the Government Performance and 
Results Modernization Act; and 2) manage and perform functions that are 
not properly chargeable to specific projects or program activities 
covered by a separate funding authority.
                        working capital fund--$0
    This fund is operated for the purpose of managing financial 
activities such as acquisition and replacement of capital equipment, 
cost recovery for services provided to others, fleet management, 
administration of information technology services, and recovery of 
indirect costs in the Technical Service Center, Mission Support 
Organization, and regional and area offices. The fund is credited with 
appropriations and other funds for the purpose of providing or 
increasing capital. The fund operates on a self-supporting basis 
through user charges that are deposited in the fund. It is through the 
Working Capital Fund that Reclamation pays for many Departmental 
Centralized services.
    This completes my statement. I would be happy to answer any 
questions.

    Senator Alexander. Thank you, Mr. Mikkelsen.

                         TRIBUTE TO LET MON LEE

    Before we turn to questions, Mr. Lamont, I want to thank 
you for recognizing Mr. Let Mon Lee's impending retirement. He 
is sitting right behind you there.
    We understand he is about to retire in order to spend more 
time with his family, especially his grandchildren. He has 
played a very important role for the Corps and its relationship 
with members of Congress, and we are grateful for that.
    Mr. Lee, we thank you for your service to the United 
States, and to this Committee, and best wishes in your 
retirement.
    Mr. Lee. Thank you.
    [Applause.]

                      INLAND WATERWAYS TRUST FUND

    Senator Alexander. Now Mr. Lamont, let me ask you about the 
Inland Waterway Trust Fund.
    We tried very hard the last few years to really do what a 
great country would do for the Inland Waterway Trust Fund. Let 
me just get the facts on the record.
    In 2014, at the request of the barge owners, we increased 
the fee on a gallon of gasoline from 20 cents to 29 cents per 
gallon.
    Is that correct?
    Mr. Lamont. Yes, sir. That is correct.
    Senator Alexander. And increasing the fee has raised the 
annual revenues to the Trust Fund by about $20 million a year 
since 2014.
    Is that correct?
    Mr. Lamont. Yes, sir. That is correct.
    Senator Alexander. And since 2014, working with the Corps, 
once we created the priority list of projects, Congress has 
appropriated all of the tax money that we collected.
    All of the estimated revenues, an average of about $106 
million a year, have been used for four main projects: Olmsted 
in Kentucky, Lower Monongahela in Pennsylvania, Kentucky Lock, 
and Chickamauga Lock in Tennessee.
    Is that correct?
    Mr. Lamont. Yes, sir. That is correct.
    Senator Alexander. The President's budget estimates the 
Inland Waterways Trust Fund revenues, the taxes collected, for 
the purpose of helping the locks for this next year, are $105 
million dollars.
    Is that right?
    Mr. Lamont. Yes, sir. That is correct.
    Senator Alexander. Does the President's budget propose to 
spend all the money that is collected to fix the locks?
    Mr. Lamont. No, sir. Not at this time.
    Senator Alexander. How much of the $105 million does the 
budget propose to spend?
    Mr. Lamont. Sir, again? Please.
    Senator Alexander. How much of the $105 million that you 
are collecting, that we will be collecting from the barge 
owners in taxes to fix the locks, how much of that $105 million 
does your budget propose to spend in 2018?
    Mr. Lamont. We are going to be using $26.25 million.
    Senator Alexander. So we are collecting $105 million in 
taxes for the purpose of fixing the locks and we are only 
spending $26 million for fixing the locks?
    If you are not proposing to spend what we have, why would 
the budget propose to increase the fee on Inland Waterway users 
by $1 billion over 10 years? Why would you propose more fees 
when you are not even proposing to spend what you currently 
have?
    Mr. Lamont. Yes, sir. I appreciate the opportunity to 
clarify that.
    Olmsted is the only project that is high performing, which 
means it is budgetable and that, in essence means that the 
Benefit Cost Ratio is greater than 2.5-to-1 at a 7 percent 
discount rate.
    Now, the other three remaining projects--Lower Monongahela, 
Kentucky Lock, and Chickamauga Lock--have Benefit Cost Ratios 
at the 7 percent discount rate that are less than that 2.5-to-1 
criterion.
    The problem here is that the remaining balance to complete 
is over $10 billion. The Administration is concerned about the 
age of the infrastructure on the inland waterway system and the 
ability to effectively budget and effectively deal with the 
need to rehab these systems.
    Senator Alexander. So you are thinking of not completing 
those three locks, those three projects?
    Mr. Lamont. I would say that there is an opportunity to 
discuss within the Administration and the opportunity to look 
at these three additional locks.
    Now the President was in Cincinnati, as you mentioned, Mr. 
Chairman, and the emphasis was on the four R's: roads, rail, 
runways, and rivers. And I was very interested, as you all are, 
on rivers.
    Senator Alexander. Well, look, I am interested in rivers 
too, which is why I am wondering why you are collecting $105 
million from the barge owners and then not spending the money 
for the purpose you collect it for.
    Mr. Lamont. It is that $10 billion and how we are going to 
not string it out, sir, but how we are going to be able to 
hopefully work with the users and work with interested parties, 
possibly with a P3 initiative, Public Private Partnership, to 
have a method of attack that can actually deal with the problem 
of the crumbling infrastructure and a way forward.
    Senator Alexander. But for the last 3 years, Mr. Lamont, we 
have prioritized the waterways, one through four or more. We 
have raised taxes on the people who go through the locks. We 
have appropriated all the money we needed to, to match that, 
and the Corps has consistently told us that if you stop and 
start these locks, it is wasteful and more expensive.
    Why would you restart a lock for 3 years and then stop it?
    Mr. Lamont. I agree as an engineer that is a difficult 
thing to deal with given the funding constraints, and the 
priorities of the Administration, and the budgeting criteria.
    I have to say no matter what Administration, Republican or 
Democrat, it goes back to 1992 as far as the ability to analyze 
benefits and costs on water resources projects.
    For a budgetary ability to go forward, the Benefit Cost 
Ratio has to be greater than 2.5-to-1 at a 7 percent discount 
rate.
    Senator Alexander. Well, my time is up and I would like to 
stick to the 5 minutes. We have lots of Senators who have 
questions.
    But I will be coming back to this subject, particularly the 
way the Corps calculates its Benefit-Cost Ratio.
    Senator Feinstein.
    Mr. Lamont. Yes, sir. Thank you.

                        NEW CONSTRUCTION STARTS

    Senator Feinstein. Thank you very much, Mr. Chairman.
    I have a question on new construction starts.
    Mr. Lamont, the Corps' rationale for utilizing only one new 
study start is that the Corps wants to prioritize ongoing 
projects over new projects, as I understand it.
    However, I noticed that the Corps' 2018 budget includes 
$1.02 billion for construction. Now, that is the lowest level 
of funding requested in 5 years at $856 million, or 46 percent 
less, than the 2017 Omnibus provided.
    If this Administration continues to emphasize only ongoing 
work, how will the Corps be able to address new challenges that 
arise from our infrastructure needs, because we have several of 
them in California?
    Mr. Lamont. Yes, Senator Feinstein.
    We have limited resources. We have competing demands, many, 
many demands across the Nation. And did you want to say 
something? I am sorry.
    Senator Feinstein. Well, if we put more money in that 
account, would you adjust it accordingly?
    Mr. Lamont. The President's budget put an emphasis on our 
existing projects and there is $3.1 billion that is allocated 
basically for operation and maintenance of our existing 
projects. That left $1.02 billion for construction.
    I understand your concerns relative to the ability to move 
forward. The opportunity to move forward obviously looks at the 
constraints that we are under relative to the President's 
fiscal responsibilities and also deficit reduction.
    The competing demands will be: do we add to the backlog of 
authorized projects that may or may not compete? That gets back 
to the 7 percent and the Benefit Cost Ratio criterion. Or, do 
we focus our efforts on what is out there existing now? Trying 
to make sure that we are putting money, the higher risk 
elements, the Operations and Maintenance account, and then 
focusing on completing construction diligently?
    Senator Feinstein. Well, I mean, I listened to you. I 
really do not know what it all means. It seems to me the 
Congress has an ability, too, to add money and that we should. 
I do not understand.
    A 46 percent essential cut in new construction, if you are 
going to build infrastructure in this country, you all do it in 
the Army Corps. That is where it is at.
    And not to have an opportunity to present a project, is 
what you are saying, if I understand it. What you are saying 
is, ``Do not bother. We are not going to do it.''
    Is that right?
    Mr. Lamont. No, Ma'am. Again, there are so many needs 
across the Nation.
    Senator Feinstein. Right.
    Mr. Lamont. There are such limited opportunities relative 
to the discretionary funding that is available. I share your 
concern wholeheartedly as to the ability to move forward here.
    But again, the President's concern was what has already 
been under study, for example, and through past work plans. 
There were 16 studies that were commenced. This year with the 
work plan, there was only one new study that was started.
    So again, that is the focus on O and M and on construction.
    Senator Feinstein. Got it.
    Mr. Lamont. I wholeheartedly understand exactly what you 
are saying.
    Senator Feinstein. I appreciate that and we can talk more 
about it. I hope you will be available.

                         CENTRAL VALLEY PROJECT

    Let me talk about another big problem. All the way down 
through the Central Valley is subsidence of land caused by 
overusing groundwater. In some places, we are told, that if 
there were a big earthquake, the earth could drop 60 feet.
    Having said that, there are cracks in the canal; there are 
cracks in the freeways from this subsidence. And in one place, 
the subsidence has reduced the water carrying capacity of the 
Friant-Kern Canal by 60 percent, severely disrupting water 
supply and groundwater recharge operations throughout the 
Friant Division of the Central Valley Project.
    Let me ask Mr. Mikkelsen this question. I know that you are 
working on this. What resources and authorities does 
Reclamation have or need to address this problem in both the 
short and the long term?
    Mr. Mikkelsen. Thank you, Senator, for the question.
    We are working. I think there is a, we are still trying to 
allow the, I think the use is----
    There is about $23.1 million, if I remember correctly, in 
the restoration fund there that we believe can be used for 
that. The problem is, that is not going to even come close to 
touching what is needed for that subsidence problem.
    I was out there 2 weeks ago. There is water literally 
lapping at the bridges and we are down 30 percent capacity of 
that canal in that particular area.
    I would just make an observation, I guess, since I may not 
have the opportunity to appear before this Committee again, 
that the Reclamation Fund has a current balance of about $17 
billion.
    Senator Feinstein. We will talk later.
    Senator Alexander. We have that problem, Senator Feinstein, 
with the Harbor Management Trust Fund.
    Senator Feinstein. Yes.
    Senator Alexander. With that Fund as well, so we need some 
creative financing.
    Should I go on, Senator?
    Senator Feinstein. I think my time is up.
    Senator Alexander. We will try to come back, Senator 
Feinstein.
    Senator Feinstein. Thank you.
    Senator Alexander. With all the Senators here.
    Senator Feinstein. No problem.
    Senator Alexander. Senator Cochran.

                MISSISSIPPI COASTAL IMPROVEMENTS PROGRAM

    Senator Cochran. Mr. Chairman, thank you.
    General Semonite, in 2005, Congress authorized the Army, 
U.S. Army Corps of Engineers to carry out the Mississippi 
Coastal Improvements program.
    The program is intended to restore portions of the 
Mississippi barrier islands in response to the damages caused 
by Hurricane Katrina and to make the Gulf Coast more resilient 
against damage from future storms through an array of 
structural and nonstructural protection measures.
    Congress appropriated $439 million for this effort in 
fiscal year 2009 and it is my understand that the Corps has 
made good progress toward executing important phases of the 
project, particularly restoration work on Ship Island and Cat 
Island.
    The question is, can you provide me with a status update on 
the Corps' recent activities on the Mississippi Coastal 
Improvement program? Should Congress provide funding above the 
fiscal year 2018 budget request for the Corps of Engineers? How 
would you put those additional funds to use toward advancing 
programs and progress on the Mississippi Coastal Improvements 
Program?
    General Semonite. Senator Cochran, thanks for the question.
    I am not sure if you remember, but I was the Division 
Commander in Atlanta from 2009 to 2012. I have made seven trips 
down to see the area. I have been briefed several times and I 
think it is an unbelievable program.
    You talk about a portfolio of ways of being able to protect 
the coastline. That project does exactly what we needed to do.
    We made progress. You said that we made good progress. I 
want to continue to keep pushing. Ship Island was awarded in 
February of 2017. That contract, phase one, we are going to 
close out that contract hopefully in September of 2017. It will 
be completed. I am sorry, the work will begin in September of 
2017 and will be done in May of 2018.
    When you go to Cat Island, that restoration contract was 
awarded a couple of months ago. Sand placement is scheduled to 
begin on the Fourth of July, next week, and is scheduled to be 
completed within 50 days. We expect the sand grasses to be done 
sometime in November of 2017.
    With respect to your question on future money, I think I 
really need to go back in and get an assessment of: how does 
the work this summer go? Did it go as we think we had planned? 
We would like to think it would.
    And then, what can I do to come back to you and say, ``How 
would that be assessed based on the risk that is still out 
there?'' As you know, some of that was buyouts. Some of that 
was rebuilding the barrier islands. There were many, many 
different types of things.
    And so the question is, would we continue to be able to 
allocate additional funds if we are not able to buy that risk 
down enough?
    Senator Cochran. Thank you very much, General Semonite.
    Thank you.
    Senator Alexander. Thanks, Senator Cochran.
    Senator Udall.

                       NEW MEXICO DROUGHT FUNDING

    Senator Udall. Thank you, Mr. Chairman.
    I want to turn to another area on the BOR (Bureau of 
Reclamation) spend plan that I am very confused about. This 
Committee allocated $40 million in fiscal year 2017 to drought 
in the American West leaving it to the Department of Interior 
to direct the funding under the spend plan.
    Drought in the American West deserves real attention, 
funding, and creative solutions to address how we are going to 
do more with less water in the era of climate change.
    New Mexico feels the impacts of climate change and drought 
at almost twice the rate of other States with every degree of 
warming elsewhere, producing 2 degree of warming in the desert 
southwest.
    Yet, when you look at the list of investments the Bureau of 
Reclamation makes in drought, the State of New Mexico is 
conspicuously absent despite pressing need. There is a small 
amount of funding the State is eligible for through the Upper 
Colorado River operations, but this is really just drops in the 
bucket for this investment. For the people of New Mexico, this 
lack of investments is concerning.
    Mr. Mikkelsen, will you, and the Bureau, commit to working 
with me to ensure the drought funding for fiscal year 2017 
addresses the needs of New Mexicans?
    Mr. Mikkelsen. Yes, we will, Senator.
    And I was out there just last week meeting with some of 
your constituents and stakeholders.
    Senator Udall. Thank you.
    Mr. Mikkelsen. And I look forward to working with you on 
that.
    Senator Udall. Thank you very much, and we appreciate your 
visit.

                            REVIEW OF GRANTS

    We also, I understand this Administration has implemented a 
policy requiring all grants over $100,000 to be approved by the 
Secretary's office.
    Will you confirm that?
    Mr. Mikkelsen. That is true at this time, but we have not 
experienced any significant hold ups on any of the grant 
applications that we have moved forward from the Bureau of 
Reclamation.
    I would note that these are performance-based grants, as I 
noted in my oral testimony that are evaluated by an independent 
panel that we put together. And I would encourage anybody from 
any State--but particularly New Mexico, because of the arid 
nature of your State--to please make application for those and 
they will be acted on.
    Senator Udall. Great. Thank you.

                MIDDLE RIO GRANDE WATER LEASING PROGRAM

    A big priority of mine has been to support a voluntary 
water leasing program on the Middle Rio Grande, something that 
is supported by the Middle Rio Grande Conservancy District, the 
Bureau, the Audubon, and other stakeholders in order to make 
this water system function more efficiently for all of the 
users.
    The Bureau is very supportive of allocating $2 million of 
its fiscal year 2017 operating money to this critical program 
to lease water with this funding to restore system function.
    Will you commit today to support this request from the 
Albuquerque district and its partners, and to work with us to 
make sure this innovative, voluntary program is successful?
    Mr. Mikkelsen. Senator, we are working with all the parties 
on that settlement, and we commit to continue to work with all 
the parties.
    We want to be able to move that settlement forward, as you 
have noted, with those voluntary transfers of pre-1907 water 
rights at this time. And, yes, we are moving forward on that.
    Senator Udall. Thank you.

                      VILLAGE OF COLUMBUS FLOODING

    Mr. Lamont and General Semonite, this year, the Federal 
Government, in partnership with the New Mexico Border 
Authority, broke ground on expanding and renovating the port of 
entry in Columbus, New Mexico.
    The Federal Government is investing $86 million to 
modernize this facility to make sure customs and border patrol 
has the necessary facilities to fulfill its mission of keeping 
America's borders safe and secure, while facilitating 
significant increases in the number of daily crossings due to 
increased commercial and agricultural trade, and private 
vehicle, and pedestrian traffic.
    Unfortunately, the Columbus port of entry has been subject 
to reoccurring flooding over the years. And so, as I understand 
it, the Albuquerque district office submitted this project as 
its top priority for fiscal year 2017 work plan. The neap is 
complete, yet the project did not receive any funding to build 
the berms.
    Will you commit to work with me in this budget cycle to 
make sure we are not leaving an $86 million Federal investment 
in our national security infrastructure unprotected from 
flooding in the village of Columbus, New Mexico?
    General Semonite. Senator, we are certainly aware of that. 
I need to get into the details as far as why that did not have 
more justification in the budget. I will work with Mr. Lamont 
to be able to understand what that requirement was.
    I do not have exact details right now to be able to give 
you a better answer.
    Senator Udall. Yes. Well, this was the Albuquerque 
district's number one request.
    General Semonite. Yes, sir.
    Senator Udall. I hope you understand that.
    General Semonite. Although there might be a number one 
priority in one of my 43 districts, it might not necessarily 
rack and stack as a national priority.
    So we certainly will continue to follow up and do 
everything we can to try to make sure that it has all the 
justification to be able to compete well for funding.
    Senator Udall. Thank you, Mr. Chairman.
    Senator Alexander. Thanks, Senator Udall.
    Senator Shelby.

                  MOBILE HARBOR DEEPENING AND WIDENING

    Senator Shelby. Thank you, Mr. Chairman.
    General, the Port of Mobile in my State of Alabama is 
currently the tenth largest U.S. seaport by total volume. The 
Port's largest commodities are coal, crude oil, steel, and 
petroleum. And its activities, as you probably well know, 
employ over 150,000 people in my State and generate over $23.4 
billion direct and indirect in economic value.
    In any given year, millions of tons of cargo move through 
the Port of Mobile and that number is continuing to grow. It is 
one of the fastest growing ports around.
    In 2014, the Port Authority submitted a request to the Army 
Corps of Engineers to consider increasing the depth and the 
width of the Mobile harbor channel to its authorized 
dimensions. You are very familiar with this.
    The Corps subsequently began a General Reevaluation Report, 
GRR, which examines potential costs and benefits associated 
with the deepening and the widening of the port. This study is 
expected to conclude, as I understand it, in 2019.
    General, can you provide an update for us today on the 
Mobile GRR and is the study on schedule?
    General Semonite. Senator, first of all, again, I was the 
Division Commander down in Atlanta. I know that port very, very 
well. I have done port deepening from Boston all the way down 
to Houston.
    Senator Shelby. Yes.
    General Semonite. And I am very, very aware of the 
mechanics.
    First of all, there is a lot of potential in the Port of 
Mobile, without a doubt. You mentioned it is tenth up there. We 
look at all the different things that are in this. There is a 
lot of growth in commerce.
    You mentioned how many tons. It is not just tons of cargo. 
It is how many containers and the substantial amount of growth. 
You are up 14 percent this year in the amount of containers. 
Jobs are another big thing that is out there, 128,000 jobs, 
$500 million in direct and indirect tax input.
    So we see the potential of not only that port, but other 
port deepenings, just as the Chairman said. The economy here is 
at unbelievable potential.
    The other thing that is always important in a port 
deepening project is to figure out: who else has skin in the 
game? Is it only the Port Authority or has the State stepped 
up? Who else has stepped up when it comes to road 
infrastructure and the railroad pieces? Are the cranes in 
place? What about when it comes to development for warehouses 
and all the rest?
    And Mobile Port, very similar to some of those other ones 
that are very, very competitive, continues to be able to put 
skin in the game. We see a lot of potential in that port.
    You were right about the GRR. The GRR is actually on 
schedule to be completed in November of 2019. I said in my 
opening statement, deliver the program. That does not just mean 
build the concrete and steel. It means if we owe you a study, 
then we owe you to get that study done on time. And if we 
cannot for some reason, we certainly owe you the ability to be 
able to understand where the obstacles are in it, so we can 
come back.
    I am committed to be able to make sure that if, in fact, 
somewhere that gets off track, then I will come back. And I 
would love to think we could do it earlier than that, but I 
cannot promise that. We are going to be as aggressive as we 
can.
    Senator Shelby. General, it is imperative, for economic 
reasons, that in the U.S.--not only deepen the port I am 
bringing up in Mobile, but others and widening them, whatever 
we have to do--to be in the 21st century of commerce?
    Is that correct?
    General Semonite. It is certainly my opinion that there is 
unbelievable potential in port deepenings and not only the 
deepening, but the ability to get the channel widened.
    Senator Shelby. Absolutely.
    General Semonite. These large shippers are going to go 
where it is the best business for them. If they have wait 
times, if they have to wait for the tides to go up and down, if 
it is too hard to get in there, if they cannot turn, or if they 
do not have the right turning basin. All of that is going to 
then require them to go somewhere else.
    So we want to be able to optimize those ports that really 
have the potential to be national capabilities and Mobile is 
certainly one of those.
    Senator Shelby. Thank you.
    Secretary Lamont, Section 110--you are familiar with all of 
this probably by the numbers--of the Consolidated and Further 
Continuing Appropriations Act of 2015 provides that the cost of 
the Mobile GRR, that I just referenced, will be 75 percent 
Federal and 25 percent non-Federal.
    However, it is my understanding that the Corps has ignored 
this provision budget in the Mobile GRR in 2015, fiscal 2016 
and 2017 at the 50/50 cost share, and not including the budget 
line in the fiscal year 2018 request.
    Your staff has informed my staff that the reason Mobile's 
GRR budget line was not included in the 2018 budget request is 
because the project is hitting the so-called 50/50 threshold.
    Can you explain why the Corps, if you know on your own, is 
disregarding the Federal statute in their budgeting request?
    Mr. Lamont. Senator Shelby, I do not think there is any 
deliberate attempt to ignore the law.
    Senator Shelby. Okay.
    Mr. Lamont. What I would like to do is----
    Senator Shelby. Because you have to follow the law like we 
all do, right?
    Mr. Lamont. Yes, sir.
    Senator Shelby. Okay.
    Mr. Lamont. But what I would like to do is to look at this 
a little bit further.
    Senator Shelby. Get back with me on it.
    Mr. Lamont. And work with you and your staff.
    Senator Shelby. Okay. That would be fine. I just know that 
I am not above the law and you are not above the law. Nobody 
should be, and that is what we preach, and that is what we 
believe.
    Is it not?
    Mr. Lamont. Yes, sir.
    Senator Shelby. Thank you.
    Thank you, Mr. Chairman.
    Senator Alexander. Thank you, Senator Shelby.
    Senator Coons.

                        DELAWARE RIVER DEEPENING

    Senator Coons. Thank you very much, Chairman Alexander and 
Ranking Member Feinstein.
    And thank you Lieutenant General Semonite, Mr. Lamont, and 
Mr. Mikkelsen. Thank you for being here today and thank you for 
all the Army Corps and Bureau of Reclamation do for our 
country, and in particular, for what the Army Corps does for my 
home State of Delaware.
    Lieutenant General Semonite, given your time in New York 
City as Commander of the North Atlantic Division, I am pleased 
you are familiar with the Delaware River Deepening Project and 
the importance of coastal infrastructure.
    I appreciate the reprogramming of funds for the Port of 
Wilmington after they were initially left out of the fiscal 
year 2017 work plan. They are critical for dredging our Port, 
small but significant to us. I am pleased to see the fiscal 
year 2018 budget includes funding for two dredge cycles for the 
Port, so we can continue our 6 million tons of cargo delivered 
and shipped every year.
    I was glad to see the fiscal year 2017 work plan allows the 
completion of the Delaware River Deepening from 40 to 45 feet, 
as well as funds to re-nourish some of our critical beaches. I 
understand the bids for the last phase of deepening are out 
this week and our region is very much looking forward to having 
that deeper channel.
    I just want to take a moment and thank the Philadelphia 
District of the Corps who have been wonderful to work with and 
to particularly express my gratitude to Lieutenant Colonel Mike 
Bliss, who is about to leave command. I am looking forward to 
working with Lieutenant Colonel Kristen Dahle, his successor. 
Lieutenant Colonel Bliss has been just terrific. And the men 
and women of the Philadelphia District are creative, 
responsive, and greatly appreciated in my office.

                    DELAWARE RIVER BASIN COMMISSION

    Let me briefly ask three questions about the Dredge 
McFarland, the Delaware River Basin Commission, and 
infrastructure generally.
    Federal funding has not been provided to the Delaware River 
Basin Commission as required by the congressionally approved 
compact for 20 of the last 21 years. There have been clear 
congressional directives from this subcommittee, and in both 
the 2014 and 2007 Water Resources Development Acts, that the 
Federal Government should financially support the DRBC 
(Delaware River Basin Commission) and the other two river basin 
commissions and budget accordingly.
    The Army Corps recently took the position that the Planning 
Assistance to States Program meets that Federal funding 
obligation. But these planning activities require a 50 percent 
match from the river basin commissions. Rather than financially 
supporting the river basin commission as required, I view this 
as siphoning resources away from the commissions and then 
sending it back to the Corps. I think it requires the 
commissions to use a program that may not be appropriate for 
their needs.
    Can you or Mr. Lamont briefly explain why the Corps has not 
allocated funds in this budget to the Delaware River Basin 
Commission?
    General Semonite. So sir, let me start out and I think Mr. 
Lamont can certainly pick up if I miss something.
    First of all, I was on the Delaware River Commission for 3 
years.
    Senator Coons. Yes.
    General Semonite. I always use that as a model of how to do 
a total integrated water package. Great people, very, very 
focused.
    You are right. For the last 21 years, there has always been 
an expectation that the Federal Government would give cash in-
kind to be able to help offset the overhead costs of the DRBC 
administrative work. That also applies to a couple of other 
river commissions, Susquehanna, and some other ones. That has 
not been funded.
    I think what has been tried, in an effort to try to meet 
the intent of that contribution, was an in-kind contribution. 
And that is where this planning assistance to States has tried 
to meet that.
    I will let Mr. Lamont jump in if he wants to hit as to why 
there was not a cash in-kind contribution, but I think that is 
one of the challenges where we just have a lot of bills that 
are on the table that do not necessarily come across the way 
that you would want them to come across.
    Senator Coons. I understand. We are going to run out of 
time. So I will just be brief and move forward, if I can, 
generally.

                            DREDGE MCFARLAND

    Let me express support for the Dredge McFarland. Lieutenant 
General Semonite, from your previous time in the North Atlantic 
Division, you see the importance of a fleet of highly 
responsive dredges. It benefits ports, not just Wilmington, 
Delaware: New York, Norfolk, Jacksonville, and New Orleans. I 
hope you will take timely steps to replace the oldest of the 
dredges in the fleet, the McFarland.

                  ADMINISTRATION'S INFRASTRUCTURE PLAN

    Let me ask you a last question, if I might.
    President Trump has said he wants to make significant 
investments in infrastructure, and I think many of us would 
agree that should include investments in waterways and coastal 
infrastructure.
    Some of our budget requests for other departments and 
agencies have so far not been encouraging with regard to 
investments in infrastructure. Seaports handle 99 percent of 
our overseas trade by volume, support 23 million jobs.
    I would like to hear from you both, if I might, briefly, 
how you envision the Corps' work on maintaining commercial 
navigation infrastructure fitting into the Administration's 
infrastructure plan? And how the Corps is budgeting for coastal 
protection given rising sea levels and increasing storms as 
referenced before by Senator Feinstein?
    Mr. Lamont. Senator Coons, as I indicated to Senator 
Feinstein, the needs in this country are just incredible as far 
as water resource demands. With the crumbling infrastructure, I 
would say this Administration sees the wake up call and I think 
we all do.
    The challenge will be with the limited funds that we have 
to find a way forward, and there could possibly be initiatives, 
as I indicated to Chairman Alexander, in the P3 area where 
users have some potential skin in the game.
    I do not know if General Semonite wants to add anything on.
    General Semonite. Senator Coons, I think all of us in this 
room understand the importance of water resources. I do worry, 
and just as the Chairman said, some people think of 
infrastructure as road, rivers, and rail.
    Mr. Lamont and I, when we heard about the infrastructure 
package, were aggressive to seek out the Administration, who is 
putting this package together, fought our way to get into the 
right rooms and to brief them on the requirement that the 
Chairman talked about; 58 percent of infrastructure that is 
over 50 years old.
    We were able to say, not only are there great requirements 
that our Nation has, but here are some things you could 
streamline, some of those processes that do not necessarily 
allow the most valid requirements to get the funds.
    We have proposed a couple of options, and I think some of 
the Senators in the room are aware of what we are looking at, 
to try to find a better way of putting the dollars against the 
requirements. Not because anybody has an agenda to do something 
different, but some of the rules could, in fact, limit us on 
meeting the most valid requirements.
    Senator Coons. I appreciate your testimony and I hope we 
will continue to work together as this committee always has on 
a bipartisan basis to invest in America's water infrastructure.
    Thank you, Mr. Chairman.
    Senator Alexander. Thank you, Senator Coons.
    Senator Kennedy.
    Senator Kennedy. Thank you, Mr. Chairman.
    And thanks, to all of you, for coming today.
    I am going to follow up on the Senator's last question 
about the President's plans on infrastructure. I have read 
about them with interest. Clearly, we need to improve our 
infrastructure. We need to maintain our infrastructure.
    How are we going to pay for that? Are you talking? I 
understand talking about the need. That is important. But are 
you talking about how? Is there a plan to pay for it?
    Mr. Lamont. Senator Kennedy, a common theme here, I think, 
not only with the Administration but also with the 
Appropriations Committees of both houses of Congress.
    We are at a crossroads, in my view, as far as the age of 
our infrastructure and whether we are willing to step up to the 
plate--the Federal Government, non-Federal entities--and really 
take a hard look at this on the way forward.
    Senator Kennedy. Well, it sounds to me, does the 
Administration--this is what I am asking--does the 
Administration have a proposal to pay for its infrastructure 
plan that you are aware of?
    Mr. Lamont. Senator Kennedy, as General Semonite just 
indicated, I have a member of my staff, he has a member of his 
staff actively working with the President's National Economic 
Council at this very time.
    We are looking collaboratively with the Administration on 
opportunities that are out there because they realize the 
crossroads we are at right now.
    Let me add this: we have a ways to go as far as a bill that 
you might see. We are at the talking stage.
    Senator Kennedy. Well, I hear talk about P3, Mr. Secretary. 
Those are not free. I mean, the private entities, the private 
sector is not going to come in and do the project out of the 
goodness of their heart. They have to be paid.
    I mentioned this to Secretary Mnuchin the other day. I do 
not know how many trillions of dollars we have sitting outside 
of the United States because as soon as they bring the money 
back under our non-territorial system of taxation, they are 
going to be taxed on that money. Some of them have figured out 
ways around that, which is perfectly legal.
    But I think many of those companies would bring the money 
back if we could reach some sort of resolution over what sort 
of tax they would have to pay.
    Now, that is nonrecurring revenue. You obviously do not 
want to match up nonrecurring revenue with recurring expenses. 
But infrastructure, water, maritime, that is not a recurring 
expense.
    I do not think Secretary Mnuchin liked my idea too much, 
but I do not understand, and it may be a bad idea, but if we do 
not want to do that, what are we going to do? Because my 
constituents keep calling me going, ``I heard the President 
talking about the infrastructure bill, and I have a road over 
here. I want you to make sure you get it on the list.''
    Senator Feinstein. Welcome to the Senate.
    Senator Kennedy. So I am asking you, how are we going to 
pay for it? What is wrong with the idea of using some of the 
money that is offshore right now?
    Mr. Lamont. Senator Kennedy, in my 40-plus years working 
for the Corps of Engineers and with Army Civil Works.
    Senator Kennedy. Have you been doing this 40 years?
    Mr. Lamont. Yes, 40-plus.
    Senator Kennedy. Now, you are going straight to heaven.
    [Laughter.]
    Mr. Lamont. I have seen, as have you, in your lifetime the 
crumbling infrastructure. I think we are at a point of 
reckoning that, not only the Congress of the United States, but 
the Administration, has come to a point where we really have to 
look at this closely in collaboration with our partners, 
Federal, non-Federal, folks who are stakeholders. And really 
take a hard look and try to make a hard move on this.

                   SOUTHEAST LOUISIANA FLOOD CONTROL

    Senator Kennedy. Let me ask you this, and I have 36 
seconds.
    One of the advantages of going last is that I get to hear 
all of my colleagues. I learn a lot. I get to hear all of their 
projects, and I appreciate that, and I can evaluate them. And I 
have come to the conclusion that none of their projects is as 
important as the one I am about to ask you about in Louisiana.
    Tell me about where we are on the Southeast Louisiana Flood 
Control Project?
    Mr. Lamont. Senator Kennedy, I realize your concerns on 
SELA (Southeast Louisiana Urban Flood Damage Reduction 
Project). I am going to commit to you that I want to work with 
the senior leadership of the Corps and my office to explore all 
possibilities on a way forward here.
    I realize that work on SELA has progressed with the Katrina 
Supplemental Funds.
    Senator Kennedy. Yes.
    Mr. Lamont. I think what we are going to need to do is look 
hard at potential funding options here. You have my commitment 
to work with the Corps, and we will get back to you on that.
    Senator Kennedy. Okay. Thank you, gentlemen, for your 
service. Thank you, General. I enjoyed our visit.
    Senator Alexander. Thank you very much, Senator Kennedy.

                       INLAND WATERWAYS USER FEE

    Before we go to Senator Hoeven, the budget document does 
propose $1 billion increase over 10 years in user fee funding 
for inland waterways, right, or for all waterways? Which?
    Senator Kennedy. I thought it was all, Mr. Chairman.
    Mr. Lamont. Sir, I apologize. I missed your question.
    Senator Alexander. The budget document does propose $1 
billion user fee increase over 10 years.
    Is that correct?
    Mr. Lamont. Yes, sir.
    Senator Alexander. For all waterways or just inland water?
    Mr. Lamont. It is in its infant stages, it is an 
opportunity to discuss this with Congress.
    Senator Alexander. It is not part of the budget?
    Mr. Lamont. There is no specific line item in the budget.
    Senator Alexander. Yes.
    Mr. Lamont. You are correct, sir.
    Senator Alexander. Usually I do not do this, but just 
parenthetically. I like the idea of user fees, but before we 
have a user fee appropriated, we need, (A), to have a plan and 
(B), we need to spend what we are already collecting in taxes 
for the purpose for which it is collected.
    Senator Hoeven.
    Mr. Lamont. Mr. Chairman, General Semonite and I are 
actively engaged with the Administration on working forward to 
do just what you are saying, sir.

           PUBLIC-PRIVATE PARTNERSHIPS BUDGET CONSIDERATIONS

    Senator Hoeven. Thank you, Mr. Chairman.
    General Semonite, Mr. Lamont, Mr. Mikkelsen, thanks to all 
of you for being here. Good to see both of you again. We have 
done a lot of work together. I just want to express my 
appreciation to you both.
    General Semonite, what is the backlog for construction 
projects in the Corps right now? How much is it, $1 billion?
    General Semonite. $68 billion.
    Senator Hoeven. So we could cut that in half. Would that be 
a good thing?
    General Semonite. It would be great, sir.
    Senator Hoeven. Okay. So the idea behind public-private 
partnerships is that for States and other localities that have 
the money to cut the Federal share in half that we ought to 
give that consideration.
    Would you not say that would be a good thing to do, common 
sense?
    General Semonite. I would strongly agree with you.
    Senator Hoeven. So therefore, it would not make much sense 
to have a Benefit Cost Ratio at the office of Management and 
Budget that gives absolutely no credit whatsoever for somebody 
coming in and putting up half the money for a project.
    That does not make much sense, does it?
    General Semonite. It is my personal opinion, as Todd 
Semonite, that it does not necessarily incentivize those able 
to put money on the table that could help relieve the stress on 
the taxpayer.
    Senator Hoeven. And in fact, you are committed to help 
changing that Benefit Cost Ratio so that it makes sense.
    General Semonite. I am, Senator.
    Senator Hoeven. Thank you.
    I would ask Secretary Lamont the same questions on the 
Benefit Cost Ratio.
    Mr. Lamont. Yes, sir.
    The Benefit Cost Ratio, as I had indicated earlier, since 
1992 at 2.5-to-1 and 7 percent has been a high bar as far as 
competition for Federal funds.
    I understand your frustration. I understand, as General 
Semonite does, where project sponsors bring money to the table, 
there needs to possibly be the opportunity to discuss with you 
and within the Administration, how we can move forward on this.
    Senator Hoeven. Are you committed to helping address giving 
proper credit to P3 projects in the Benefit Cost Ratio that the 
OMB (Office of Management and Budget) uses?
    Mr. Lamont. Again, sir, I think we really need to look hard 
at this, and work with you and your staff, and with the 
Administration to come to some sort of----
    Senator Hoeven. Well, the administration, the Office of 
Management and Budget has committed to me that both OMB and the 
White House are committed to changing it.
    So I just want to make sure you are onboard and can help us 
do that as expeditiously as possible, and I am asking for that 
on the record.
    Mr. Lamont. Yes, sir.
    You and I have had discussions on Fargo-Moorhead, and I am 
very up to speed on exactly what your concerns are, sir.
    Senator Hoeven. And the reality is, with a $68 billion 
backlog, this is an opportunity to help everybody. It does not 
force you to do anything. It just gives you the ability to do 
what makes sense, and that is really what we are after.

                     FARGO-MOORHEAD AREA DIVERSION

    My next question is, General Semonite, just any update from 
you as to where we are in the process of getting that done?
    General Semonite. Sir, as you are aware, the work plan for 
2017 does allocate $20 million for Fargo-Moorhead. We have 
already worked our way to be able to get ready to award the 
contract for the first big phase of Fargo-Moorhead.
    There is more capability that could be applied if, in fact, 
there were more Federal funds. But right now, that $20 million 
will be utilized to start that first control structure.
    Senator Hoeven. We need to work with you on the work plan 
for 2018 as well.
    But the other thing is we need to complete the revisions to 
the CBO (Congressional Budget Office) scoring method for the P3 
so that in the budgeting process, projects can be included 
accordingly.
    General Semonite. Yes, sir.
    Senator Hoeven. Okay.
    Again, I want to thank both of you for your help on that as 
well as the Chairman of the committee. I think it really is an 
opportunity for the country, and so, I appreciate it very much.

                     SOURIS RIVER FLOOD PROTECTION

    I am going to switch to Minot. As you know, flood 2011, 
4,000 families evacuated from their homes. A lot more people 
than that, obviously, if you figure the average family is three 
or four.
    We have done a lot of work, again, State and locally to do 
that, build flood protection for them on the Souris River in 
phases. Your predecessor, General Bostick, was very helpful in 
helping us segment that.
    What we need from you now is just a commitment, General 
Semonite that you will work with the St. Paul Division to make 
sure that we get the Corps' piece of that moving as rapidly as 
we can.
    Again, it is phases and you all are coming in on the fourth 
phase.
    General Semonite. You have my commitment to continue to 
keep pushing that, sir.

                    LAKE SAKAKAWEA AND LAKE AUDUBON

    Senator Hoeven. Then the last is on Lake Sakakawea. Are you 
familiar, either of you gentlemen, familiar at all with the 
Lake Sakakawea and Lake Audubon as far as the embankment that 
separates the two and the fact that we do need to take a look 
at that?
    I am just asking that you work with us very closely before 
you decide on any course of action because that is a huge water 
resource that has many, many important uses.
    General Semonite. Senator, I am certainly aware, but I have 
never been there, but I have been briefed on it.
    We are doing public meetings right now in the next couple 
of days. The comment period will be open for 30 days, so we 
will continue to wrap those comments up.
    If you need to, I will certainly come by and let you know 
what we are thinking on that once we get all the public 
comments in.
    Senator Hoeven. That would be fantastic. Appreciate it very 
much.
    General Semonite. Yes, sir.
    Senator Hoeven. Thanks.
    Senator Alexander. Thank you, Senator Hoeven.
    Senator Feinstein and I are going to need to go to a 
meeting that is related to this subcommittee's work. So I am 
going to turn the chairmanship over to Senator Hoeven, before 
Senator Murkowski asks questions.
    I will submit my remaining questions for the record on the 
fish mitigation funding and the cost-benefit ratio in 
Chickamauga Lock.
    So I thank the witnesses for coming, and I hope you will 
excuse us.
    Senator Murkowski.

                      ARCTIC DEEP-DRAFT PORT STUDY

    Senator Murkowski. Thank you, Mr. Chairman.
    And Chairman, thank you for being here today. Thank you for 
your contributions in so many areas.
    General, I would like to start with you, if I may, and this 
relates to the Arctic. As my colleagues here on the 
Appropriations Committee know, I come to many of these 
appropriations subcommittee hearings to talk about the Arctic, 
and I would like to bring up the issue of Arctic infrastructure 
and our deep-draft port in the region.
    As you know, with increasing traffic in the Bering and 
Chukchi, we recognize the fact that we do not have a deep-draft 
port there.
    I am concerned about the Corps' decision not to fund 
ongoing work in the Corps' fiscal year 2017 work plan to 
continue the evaluation of the Arctic deep-draft port there in 
Nome.
    I do recognize that the study identified Nome as the 
preferred location for the near term development of that port. 
There was also an external, independent peer review, which 
confirmed the validity of the study.
    I do recognize that we are dealing with some challenging 
budget environments, but I equally appreciate the opportunity 
that we have here. We are seeing this unfold in front of us. We 
need to get on it sooner than later recognizing the lag time 
and how long it takes to build anything in the Arctic.
    So I am looking for your commitment, General, that you will 
work with me to ensure that the Corps does move forward with 
the strategic infrastructure project and hopefully reconsider 
the decision on funding work in the fiscal year 2017 to 
complete the design for an Arctic deep-draft port.
    General Semonite. Senator, let me talk about, first of all, 
the requirement and I will let Mr. Lamont jump in if he wants 
to talk to funding.
    The bottom line is that the NDAA (National Defense 
Authorization Act) did direct us to take a strategic look at 
this. Clearly, this goes back to the following question: where 
is the Department of Defense? Where is the Coast Guard? What 
are the opportunities up there? As you know, we started a 
feasibility study that was put on pause.
    What I think we all need to do is continue to be able to 
make sure of the situation. This was Homeland Security and 
Department of Defense coming together. We have not had an 
answer from that work that is being done as to the utility of 
Nome when it comes to DOD (Department of Defense) and the Coast 
Guard.
    But I think what we need to do is continue to be able to 
help champion every one of these requirements, so then Congress 
has all the facts they need to be able to figure out what gets 
funded or not. We will continue to work this, and I will make 
sure my guys are working with you every single day, and do 
whatever we can to identify the potential of that particular 
port.
    And sir, I do not know if you want to jump on the funding 
end, but we will certainly help justify the requirement.
    Senator Murkowski. Well, and I think along that line, if I 
may, General, making sure that it is not just an assessment or 
an evaluation as to the economic justification, but the fact 
that you have life safety reasons.
    You have other socioeconomic benefits that would come, not 
only to Nome, but to the region as a whole. Your ability to 
decrease the costs of food, for instance, the cost of fuel, 
just the general cost of living and hopefully that is included 
as part of that assessment.
    Mr. Lamont. Yes, Senator. We will look at all of the 
aspects as we proceed on any feasibility report. I can assure 
you of that. This is within the Principles and Guidelines that 
we follow for our planning program no matter what type of 
project.
    Senator Murkowski. Well, know that this is something, 
again, we want to work with you. We have had conversations and 
I know the direction here, but I just want to keep a fire under 
this.

                 SMALL, REMOTE, AND SUBSISTENCE HARBORS

    I want to scale things down. We talk a lot about big 
projects around here, particularly when we are talking about 
this infrastructure bill. I want to make sure that some of our 
smaller infrastructure projects that are so key to a very 
small, local economy that they do not get lost in the backwash 
of all of this activity.
    I raised the issue of Section 107, a small navigation 
program. It is a great fit for small communities in my State 
that are looking to construct these small harbors or 
breakwaters without having to wait years for WRDA (Water 
Resources Developmental Act) authorization.
    Is there any reason that the Corps never requests funding 
for this program in its budget? I mean, I know that we have 
projects that are waiting for funding under this authority, but 
it just seems it is not moving forward with that initiative. 
General Semonite.
    General Semonite. Senator, all of the requirements that we 
have, billions of dollars we put forward; those requirements 
and the capabilities of those requirements continue to be 
outlined.
    There are two specific programs you are talking about. 
There is a component of the Harbor Maintenance Trust Fund that 
is for 10 percent for small, emerging harbors.
    Senator Murkowski. Right.
    General Semonite. We always try to make sure we have fence 
funds to be able to compete for exactly what you are talking 
about.
    The other thing that is specifically in your area, though, 
is the remote and subsistence harbors.
    Senator Murkowski. Right.
    General Semonite. That is the 2006 justification and that 
is another one where there is not a set-aside, though. Those do 
not come out of that 10 percent of that fenced amount of money. 
Those do have to compete.
    There are two you have right now, Craig Harbor and Little 
Diomede that I think are authorized for the funding. But those, 
unfortunately, do not have any additional justification to be 
able to bring them up high enough on the funding line.
    Now, if you want to jump in, sir. But basically, we put the 
requirement forward, but the question is when you rack and 
stack, those do not have a special ability to be able to 
qualify for a higher level of funding.
    Senator Murkowski. Well, and whether it is the Section 107 
or whether it is, as you point out, the opportunities for a 
small and remote subsistence harbors, we would like the Corps 
to be able to exercise this discretion that we were trying to 
give you in last year's language. To take into account the 
regional benefit that then comes when you are able to put in, 
like the dock that we are talking about in Emmonak, very small, 
but the economic benefit to that region is really quite 
extraordinary.
    So, I guess the ask is for you to consider supporting 
funding specifically for building these remote or subsistence 
harbors to match the general investigation funds.
    Is that an approach that we could work through?
    Mr. Lamont. Senator, aside from the Benefit Cost Ratio, I 
agree with you. We will give equal opportunity to look at the 
site-specific problems that these communities are facing.
    General Semonite hit the nail on the head. We have two 
recent projects that were authorized, Craig Harbor in Alaska 
and of course, Little Diomede. Getting over the bar as far as 
their ability to compete is on us; our job is to work within 
the Administration and to work with Congress. So your point is 
well taken.
    Senator Murkowski. Mr. Chairman, I appreciate a little 
extra time.
    Sometimes it is, again, these very small projects. We get 
carried away with the big things, but you have mentioned a 
couple of projects from your State that probably are not making 
the front pages of major newspapers. But for the economic 
impact to your region, they are quite considerable.
    So as we look to how we deal with infrastructure in this 
country, I sure hope we do not lose sight of these small, 
regional drivers because it does make a difference.
    Thank you, Mr. Chairman.
    Senator Hoeven [presiding]. Senator from Alaska, as usual, 
is right on.
    Senator Merkley.

                               DALLES DAM

    Senator Merkley. Thank you very much, Mr. Chairman.
    Pleasure to have all of you here. There are so many 
different things you are involved in that affect my home State 
of Oregon.
    Mr. Lamont, thank you for working with the Northwest 
delegation to right the historical wrong in which the Tribes' 
housing was not rebuilt after the dams were constructed on the 
Columbia River. Really, so much progress has been made on this 
in a short period.
    We have $1.56 million that was obligated under the 
continuing resolution for the village development plan for one 
of those housing communities. It is a $3 million project. My 
understanding is you are working to identify the balance of 
that $3 million and I just wanted to check in to see how that 
is going.
    Mr. Lamont. Yes, Senator. Those discussions are underway as 
I speak right now.
    Senator Merkley. Thank you.
    I want to certainly lend enthusiasm and encouragement. 
These dams were built half a century ago and it is an ancient 
failure on our part to fulfill our end of the bargain, and I 
just encourage every possible effort for us to keep moving 
forward with the effort.
    Mr. Lamont. Yes, sir. I appreciate your concern and we will 
move forward on that.

                    CRITICAL DREDGING AT SMALL PORTS

    Senator Merkley. Thank you. And as my colleague from Alaska 
was talking about the small ports, that is certainly a 
significant issue in my State with many coastal ports and the 
set aside.
    And so, General Semonite, this is a situation where with 
our coastal ports, there is commercial activity. There is sport 
fishing. There is recreational activity. With the southern 
currents along the coast, they fill in pretty quickly and so 
regular dredging is key to those coastal economies.
    We have done well in terms of the funding for fiscal year 
2017, but I am concerned about the budget, which leaves out 
seven of the coastal ports in Oregon for fiscal year 2018.
    I wanted to check-in to see if we can work together to try 
to make sure that any of those ports where there is critical 
dredging to occur that we are able to get them accomplished in 
fiscal year 2018 as well.
    General Semonite. Senator, obviously we will work as much 
as we can to continue to get those that are not funded to get 
them to be better justified. But I think the good news is, and 
I sent this out about three hours ago. See all the green on 
this sheet?
    Senator Merkley. Yes.
    General Semonite. So you have 18 ports that we are 
specifically tracking right now, and I will just lump together 
the fiscal year 2017 work plan as well as the fiscal year 2018 
budget. You basically have 13 of those budgeted either in the 
work plan, or the budget, or both. There are five that I am 
tracking that, in fact, do not have funds.
    And that is where, again, the best we can do is to 
continually find ways of better documenting and hopefully being 
able to justify these projects for additional funds.
    Senator Merkley. Thank you. I will look forward to 
continuing to work with you all on that and sometimes some of 
them are those that are unfunded are more critical than others 
and we will try to find a way to accomplish them.
    Thank you.

                             KLAMATH BASIN

    And then, Mr. Mikkelsen, I wanted to turn to the Klamath 
water situation. We have worked very hard over the years. I say 
``we,'' the stakeholders, the Tribes, the ranchers, the 
farmers, the fishermen, the community, the delegation to try to 
figure out how to resolve a challenge in which water is grossly 
over-allocated. And how to, therefore, sustain a healthy lake, 
a healthy river, and a healthy economy which there is a limited 
supply. And we have had the three worst ever droughts in 
Klamath Basin in the last decade and a half.
    The stakeholders at this point are far apart. There was a 
Klamath Basin Restoration Agreement that did not make it 
through Congress and the facts on the ground keep changing, 
which means that we have to reassemble.
    But I understand you are scheduled to visit the Basin in a 
few weeks and I would love to have a chance for the folks on my 
team, who have been immersed in this, to sit down and 
brainstorm before your trip as we work to reassemble pieces of 
this puzzle.
    Mr. Mikkelsen. Thank you, Senator.
    I want to actually express my appreciation right now to 
your staff because they took the time to meet with me for about 
an hour about two and a half or three weeks ago, and then meet 
with my special assistant or senior advisor also for another 
hour on top of that and I will be going out.
    I will be continuing my trip from Santa Fe on the 15th, 
flying into Eureka, California and starting at the Yurok end of 
the Klamath on Sunday. And I will be in Klamath Falls by 
Monday, I think, the 17th. I plan on spending 3 days there 
right now.
    I reviewed the draft itinerary yesterday and noted that on 
one of those days, I had an airboat ride on a refuge. As much 
as I would like an airboat ride on a refuge, I think that my 
time would be better spent meeting with some of the upper basin 
folks that we do not have on the itinerary at this time. So I 
have asked my people to go back and try to make the trip a 
little bit more inclusive.
    And we are going to try to meet with as many stakeholders 
at that time as we can to just make sure everybody has a desire 
to try to move this process forward. We are interested in 
solutions.
    Senator Merkley. It is a very complicated set of issues 
including the removal of dams on the river that do not produce 
much power. They are not used for irrigation themselves. Fish 
passage.
    And also the Tribes' forest was taken away from them and 
turned into a national forest. It is the only case like this in 
the country and when the Tribe was restored, it was not re-
provided with the land that the Federal Government took from 
them to turn into a forest. And those are some of the issues.
    But the health of the water and the stream, and figuring 
out how exactly we can conserve water, use water more 
efficiently both in the upper basin and on the refuge in order 
to have a prosperous farming-ranching community in both 
locations, but still get enough water in the rivers.
    There are a lot of pieces to assemble and the fact that you 
are taking 3 days to be there is really greatly appreciated. 
Because hopefully, and I hope in my time in office, we will 
finally reach a settlement and be able to get a congressional 
stamp of endorsement on it.
    Mr. Mikkelsen. Senator, I actually enjoy challenges like 
this, believe it or not. I've got about 30 or 35 years of 
experience in dealing with these sorts of situations and am 
looking forward to engaging at Klamath.
    Senator Merkley. Well, in that case, you are the right man 
for this job and you are going to have a lot of fun. It is a 
significant challenge.

                            NEW STUDY STARTS

    I wanted to turn back to Mr. Lamont and just note that the 
fiscal year 2017 Omnibus budget had slots for about six new 
start studies related to levees. And Oregon, and specifically 
in the Portland metro area, has been working to address the 
role of its levees and the actions that needed to be taken.
    There is a lot of concern that, I think, that only one of 
these six new start slots was filled and Portland would like to 
get on the list, and figure out how to get Portland into one of 
these remaining five slots. I just thought I would toss that to 
you.
    Mr. Lamont. Yes, Senator. As I had indicated earlier in my 
testimony in some of the questions from the panel members, the 
demands on the system are incredible as far as water resource 
development across the Nation.
    This Administration put a high premium on, within the 
constraint of $5.002 billion, where to put those funds. $3.1 
billion is in operations and maintenance; that is about 62 
percent of the program. About $1 billion, $1.002 billion, is in 
construction. So we look very, very hard at that.
    I know there is a lot of disappointment across the 
membership here, but the emphasis from the Administration was 
on our existing projects, to ensure we are doing our best, 
where the risk is high, to fund those projects within our 
Operations and Maintenance account and to continue construction 
of projects that are underway. And then to allow some new 
starts for construction and only one new study start.
    That new study start, again, as General Semonite had 
indicated, is an opportunity with a project sponsor that may be 
bringing some more into the game. That really received a high 
level review by the Administration.
    So if there is any additional information that you need, I 
would be happy to work with your staff or yourself, sir.
    Senator Merkley. Well, I take your point. The resources are 
constrained and you have to make choices. I respect that, but I 
just want to make sure you are aware of how important this is 
to the future of the Portland metropolitan area.
    Mr. Lamont. Yes, sir. Very aware. I grew up and worked in 
the planning program of the Corps, and that is the beginning of 
the pipeline for our new infrastructure projects.
    And despite the backlog that General Semonite indicated, we 
have new demands on the system that deserve our attention. I 
will work with you and the committee staff on anything in the 
future on that.
    Senator Merkley. Thank you very much.
    Mr. Lamont. Thank you, sir.
    Senator Hoeven. Nearly adjourned.
    Senator and Governor Shaheen is here. Having worked with 
her both as Governors and now as Senators, and formerly 
chairing and serving as ranking member of Homeland Security, I 
am not only pleased to see her, but certainly want to make sure 
she has an opportunity to ask, what I know, will be extremely 
insightful questions of each of you.

           PORTSMOUTH HARBOR AND PISCATAQUA RIVER NAVIGATION

    Senator Shaheen. Well, thank you very much, Mr. Chairman, 
both for that great introduction and for keeping the hearing 
open.
    And thank you all for being here today.
    I apologize. I was here earlier and I had to go to another 
meeting. So I am glad I could get back because I wanted to ask 
General Semonite about two projects that are pending in New 
Hampshire that have to do with both economic impact and safety 
impact. I know that you are aware.
    The first of those is the Portsmouth Harbor and Piscataqua 
River Navigation Improvement Project. As I know you know, 
General Semonite, the Piscataqua River is one of the fastest 
currents in the United States. It makes for a very challenging 
travel into the river and getting into port in Portsmouth.
    The turning basin is always an issue. What we are hoping is 
that this project that will widen the turning basin is 
something that will move forward. I know that the Army Corps 
has submitted a favorable study for the project.
    I wonder if you could just update me on what you think the 
current status of this is, and what we could do to support the 
effort to keep it moving forward?
    General Semonite. Senator, let me talk about where we are 
at on it.
    Senator Shaheen. That would be great.
    General Semonite. And then if Mr. Lamont wants to step in 
on the funding end. As much as I love North Dakota, I am 
actually from Vermont. So many, many times I have driven across 
the Portsmouth Bridge up into Portland, Maine. I know that area 
very, very well.
    So Preconstruction Engineering and Design effort was begun 
a couple of years ago. The non-Federal sponsor funds have been 
received. Design phase is underway. The project was authorized. 
The construction phase has not been funded.
    Now, as Mr. Lamont has said earlier, this is one of those 
projects that has to compete.
    Senator Shaheen. Right.
    General Semonite. It does not get special consideration 
under a remote harbor or an emerging harbor. It is one of those 
that has to be able to compete on Benefit Cost Ratio.
    Unfortunately, the BCR (Benefit Cost Ratio) for this is at 
1.9 so this is where, again, the best thing that we in the 
Corps can do, is to continue to champion it and to be able to 
help justify it, including going back and making sure the 
numbers are right, so when it is submitted up the chain, it is 
able to compete as best possible.
    And sir, if you want to jump in on that.
    Mr. Lamont. Yes, Senator.
    In my former life as one of the Deputy Assistant 
Secretaries, I worked with the planning program at the Corps of 
Engineers. I personally worked on the Chief's report and tried 
to get it through the Administration, and we did. We were 
successful on that. It is now authorized and I am thankful to 
the Congress for that.
    General Semonite, again, hit the nail on the head as far as 
the Benefit Cost Ratio. I do not know if you heard my prior 
response to many, many questions about how things compete. That 
is what it is coming down to.
    The BCR at 7 percent is 1.9. The threshold for budget 
ability is 2.5-to-1 at a 7 percent discount rate. Senator 
Alexander, Chairman Alexander had many questions on that 
earlier.
    The problem is we have so many needs across the Nation. The 
Administration puts a high priority, and they have since 1992, 
on that Benefit Cost Ratio as being the major criterion to deal 
with. Of course, there are other aspects too, which could be 
life safety considerations, for example.
    Now, in the fiscal year 2017 work plan, we considered all 
authorized projects that might be able to compete and go 
forward as new starts. Unfortunately, this one did not. I am 
willing to work with you in the future as far as the budget 
ability of this project for further consideration in fiscal 
year 2018.
    Senator Shaheen. I only heard part of Senator Alexander's 
questions to you about this issue, but how much are we 
challenged in being a small State with an infrastructure 
project like this one that does not have the same capacity as a 
New York or a New Orleans? How much does that cut against us?
    Does that not speak to the need to make sure that as we are 
looking at whatever formulas we have that we are able to 
accommodate small States like North Dakota, and New Hampshire, 
and the projects that we have?
    Mr. Lamont. I think, Senator, the issue here is we have 
basically two criterion relative to the Benefit Cost Ratio.
    For the planning process, under the Principles and 
Guidelines that we follow, we have to have a Benefit Cost Ratio 
of 1.0-to-1 at the Authorized Discount Rate. The Authorized 
Discount Rate is 2.875 percent, which means that it could go 
forward for authorization.
    Now as far as budget ability, we are back on that BCR of 
2.5-to-1 or greater at a 7 percent discount rate.
    Senator Shaheen. Okay. So explain that, not in those 
numbers, but in what that means for projects like this that are 
competing against projects in big States with big populations.
    Mr. Lamont. It really comes down, on flood damage reduction 
projects, for example, where real estate values may vary 
considerably. In urbanized areas, there are going to be high 
property values. In rural areas, those property values may be 
considerably lower.
    We saw a good example of this in Iowa when Senator Grassley 
and Senator Ernst were concerned about an authorized project in 
Cedar Rapids, Iowa, and the ability of that project to go 
forward into construction. Again, it was constrained by that 
Benefit Cost Ratio and ability for it to compete with very, 
very limited Federal resources. That is the crux of the 
problem.
    We must find a way to work with you all in the Congress. As 
I have indicated before, this President's infrastructure 
initiative may be the key as far as bringing all parties 
together at a crossroads that this country is now at relative 
to aging infrastructure and our ability to push forward as a 
Nation.
    General Semonite. Senator, let me try to target your answer 
a little bit better as well.
    Very, very large harbors that have a lot of throughput, a 
lot of containers and a lot of tonnage do compete very, very 
well.
    Very, very small harbors have a special set-aside that the 
committee has designated, which we think is a great idea. They 
compete within a bin of only about 10 percent of that set-
aside, but they do compete.
    If you are somewhere in the middle, then it is a challenge 
and that is something that we can continue to try to give 
recommendations back to the committee and the Administration on 
how to address the issue.
    Unfortunately, it is not based on recreation. It is based 
on industry and throughput and that is a little bit more of a 
stretch on those types of a harbor.

                        HAMPTON SEABROOK HARBOR

    Senator Shaheen. Well, and again, that is the other project 
that we have in New Hampshire that is pending as well, which is 
the Hampton Seabrook Harbor which is really in desperate need 
of dredging. It is critical to our tourism industry and to the 
whole economy of the seacoast.
    Like Portsmouth, these are both essential economic engines 
for the State of New Hampshire, but it is going to be the same 
problem, I am sure, as this project moves through the process.
    General Semonite. But Senator, this committee over time has 
done a great job of understanding where some of those projects 
that do not compete well, how do we change the rules to be able 
to find ways and innovative strategies to be able to address 
those.
    So this is where we want to continue to work with anybody 
on the committee to say, ``Here are some other tools that are 
out there.'' Clearly, it is up to you to decide whether you 
want to accept those tools.
    But maybe there are some more things we can do to turn the 
knobs a little bit better to be able to figure out: how do you 
approximate that share? Especially when it comes to some of the 
economic value, how do you make sure that we are represented?
    We are more than willing to work with anything we can, to 
be able to help give the committee better options.
    Senator Shaheen. Well, thank you. I think that would be 
very helpful and I look forward to working with you to do that.
    Senator Hoeven. Thank you, Senator.
    Again, I want to thank all of you for coming and for the 
very important work that you have done in regard to our part of 
the country, both Secretary Lamont and General Semonite. Again, 
my sincere appreciation.
    Also, Acting Commissioner Mikkelsen, thank you as well for 
some of the work you have done in regard to Lake Tschida and 
work we are trying to do now on Lake Patterson. Again, I 
appreciate the problem solving approach.
    So again, to all of you, thank you.

                     ADDITIONAL COMMITTEE QUESTIONS

    The hearing record will remain open for 10 days. Senators 
may submit additional information or questions for the record 
within that time if they would like. The subcommittee requests 
all responses to questions for the record be provided within 30 
days of receipt.
    [The following questions were not asked at the hearing, but 
were submitted to the Department for response subsequent to the 
hearing:]
       Questions Submitted to Lieutenant General Todd T. Semonite
            Questions Submitted by Senator Susan M. Collins
    Question. I'm pleased that the Corps' budget request included 
funding for small ports and harbors in Maine: $4.2 million for the Saco 
River, $2.5 million for York Harbor, and $400 thousand for Wells 
Harbor. This maintenance dredging is extremely important to the 
commercial lobster and fishing industry in Maine, and these Federal 
navigation projects have an outsized economic impact. General Semonite, 
your written statement notes that the budget funds several small port 
projects. How can the Army Corps continue to make sure small ports and 
harbors can properly compete for scarce navigation maintenance funds?
    Answer. The Corps focuses funding for maintenance dredging on those 
projects that provide the greatest economic, environmental, and public 
safety returns to the Nation, but also considers many other factors. 
For small harbors and channels the Corps considers channel conditions 
as well as other factors such as use of a harbor as a critical harbor 
of refuge or a subsistence harbor; support for public transportation; 
U.S. Coast Guard search and rescue or other Federal agency use; the 
reliance on marine transportation for energy generation or home heating 
oil deliveries; and the level of commercial use. The fiscal year 2018 
Budget provided nearly 10 percent ($93.2 million) to emerging harbors 
of the amounts derived from the Harbor Maintenance Trust Fund.
    Question. I was grateful that in April the Army Corps and the Navy 
were able to work together and conduct an emergency dredge of the 
Kennebec River to allow the USS Peralta, built by Bath Iron Works, to 
safely traverse the river to the open ocean. Bath Iron Works is one of 
only two shipyards that builds DDG-51 guided missile destroyers for the 
Navy, and it's absolutely essential that these destroyers are able to 
conduct sea trials and ultimately be delivered to the fleet for 
operations across the globe. Twice since 2011, shoaling of the Kennebec 
has required emergency dredging to ensure Navy ships built at Bath can 
reach the open seas. Of course, waiting until a situation becomes an 
emergency is never a sustainable way to deal with any issue. Will you 
work with Congress and the Navy to come up with a permanent solution to 
this reoccurring problem?
    Answer. The Acting Secretary of the Army has engaged Navy 
leadership regarding future Navy ship building operations that may 
require dredging the lower Kennebec River.
    Should future Navy ship building operations require dredging the 
lower reach of the Kennebec River, the Navy will need to be prepared to 
use its appropriations to execute the work, or have other stakeholders 
fund the work using existing Civil Works authorities providing for the 
use of contributed funds. The office of the Assistant Secretary of the 
Army for Civil Works will continue to work closely with Navy to address 
future funding, timing and dredging on the Kennebec River to support 
the Navy's ship building operations.
    Question. One long-term problem Maine and the city of Saco has 
encountered deals with ongoing erosion of Camp Ellis Beach. To date, 37 
homes have been lost due to erosion, so this truly is a pressing 
problem. The Corps' has been studying shore damage mitigation options 
under Section 111 of the 1968 Rivers and Harbors Act. My understanding 
is that currently, the New England District believes the total 
feasibility, design, and initial construction costs for the project may 
be greater than the current authorized statutory cap, which obviously 
is problematic. The District is in the process of preparing the full 
report and decision document for this project, which will be submitted 
for review and approval at Corps headquarters this summer. Will you 
please ensure this report is acted upon quickly so both the Army Corps 
and Congress can take any needed actions on the project?
    Answer. Corps Headquarters, the New England District, and the 
Office of the Assistant Secretary of the Army for Civil Works are 
working to identify a path forward on this report.
                                 ______
                                 
            Questions Submitted by Senator Richard J. Durbin
    Question. Recently a silver carp, one of several species of 
invasive Asian carp, was pulled out of the water in the Chicago 
Sanitary and Ship Canal, a mere nine miles from Lake Michigan. The 
carp, caught by a commercial fisherman below the T.J. O'Brien Lock and 
Dam was not a small fish, at a length of 28 inches and weighing 8 
pounds. It is concerning that a fish this size made it past the 
electric barriers. This is the not the first time an Asian carp has 
been found past the electric barriers, the first was in 2010, when a 
bighead carp was found in Lake Calumet. Since the 2010 incident, a 
multi-pronged approach, which included maintaining the barriers and 
fishing to thin the population of carp within the Illinois River, has 
been funded by the Great Lakes Restoration Initiative, a program that 
the Trump Administration proposed to eliminate in the fiscal year 2018 
budget. We all know the importance of keeping the invasive Asian carp 
out of the Great Lakes. In the Mississippi River, the carp have already 
shifted the ecological balance of the river significantly. We cannot 
ignore the Asian carp threat, which puts the ecological stability and 
$7 billion annual fishing industry of the Great Lakes' at risk. In 
response to the silver carp caught last week, what steps is the Corps 
taking to ensure the safety of our Great Lakes?
    Answer. It is true that one fish was found approximately nine miles 
from Lake Michigan. While the forensic analysis of this silver carp, 
which was captured on June 22, has not yet been completed, it is not 
possible to distinguish a fish that passed through the barrier on its 
own from a fish that was illegally transported around the barrier. 
Also, the closest known adult Asian carp populations in the Illinois 
River are about 47 miles from Lake Michigan and no small Asian carp 
have been observed closer than 88 miles from Lake Michigan.
    In response to the capture, the Corps participated in a two-week 
intense sampling operation in the area, as outlined in the Asian Carp 
Regional Coordinating Committee's (ACRCC's) Contingency Response Plan, 
with the U.S. Fish and Wildlife Service and the Illinois Department of 
Natural Resources. The sampling effort, which exceeded 1,950 person-
hours, consisted of setting more than 43 miles of gill net and 
conducting 365 electro-fishing runs in a 13-mile area from below the 
T.J. O'Brien Lock and Dam to Calumet Harbor. No additional bighead or 
silver carp were captured during this exercise.
    Question. The Corps study at the Brandon Road Lock and Dam is a 
critical step in preventing the spread of Asian Carp and understanding 
what methods would best prevent their movement towards the Great Lakes. 
The Corps Tentatively Selective Plan or ``draft study'' for Brandon 
Road was scheduled to be released on February 28 but that release has 
been delayed by the current Administration. It is my understanding that 
the Brandon Road Study that was set to be released in February is 
complete. Can you confirm what is causing the delay in the Corps 
releasing the report?
    Answer. The Brandon Road draft study report addresses a range of 
possible alternatives and outcomes that may impact diverse ecosystems 
and national economies. As such, elements of this report require 
extensive coordination with governmental and non-governmental 
stakeholders.
    Question. Shortly before the expected release of the Brandon Road 
Study, several Members of Congress wrote to President Trump asking him 
to delay the study, arguing that the ``non- structural actions taken 
thus far have successfully mitigated the risks associated with Asian 
Carp.'' Given the discovery of the Asian carp last week nine miles from 
Lake Michigan, is that still an accurate reason to justify the 
continued delay of the release of the Brandon Road Study?
    Answer. The Brandon Road study will be released upon completion of 
the ongoing review.
    Question. I was deeply disappointed to find that for the second 
year in a row there was no funding for the continuation of construction 
of the McCook Reservoir in the Administration's budget request. When 
completed, the reservoir will prevent over $114 million in annual flood 
damages to the Chicagoland area, protect over 5 million people, and 
enjoy a 3 to 1 benefit cost ratio. At 91 percent complete, it is simply 
unacceptable for the Corps to refuse to finish the job. Since its 
authorization back in 1988, Congress has been clear that both stages of 
the project were authorized for storm water protection. Congress once 
again confirmed its intent on McCook in both last year's WRDA 
authorization bill and last year's Energy & Water appropriations bill 
that McCook is a storm water project and that the Corps should expedite 
its completion with appropriate funding. Can you help me understand why 
the Corps continues to ignore the clear direction from Congress on 
McCook?
    Answer. The Budget provided funding in fiscal year 2016 to complete 
Stage I of the McCook project and thereby enable the non-Federal 
sponsor to meet the requirements of its consent decree with the 
Environmental Protection Agency. When it became apparent that the Corps 
would need more funding to meet this objective, we provided such 
funding in the fiscal year 2017 work plan.
    Question. I appreciate that some funding for McCook was included in 
the Corps' fiscal year 2017 work plan, but that funding was not even 
enough to complete Stage 1 of McCook, which is required by consent 
decree to be operational by the end of this year. Can you commit that 
the Corps will work to secure immediate and near-term funding to make 
up the approximately $11.6 million shortfall in fiscal year 2017 
Federal funds for the McCook Reservoir?
    Answer. We will consider whether to propose additional funding in 
fiscal year 2017 and, if so, would identify a source for any potential 
increase.
    Question. Can you guarantee that funding for the McCook Reservoir 
will be included in the Corps' fiscal year 2018 work plan?
    Answer. This project will be considered for future funding, along 
with other programs, projects, and activities across the Nation in 
competition for available Federal resources.
    Question. The Metro East Levee System, which spans 75.8 miles, is 
made up of five levee systems: Wood River Levee, Chain of Rocks Levee, 
Metro East Sanitary District, Prairie du Pont, and Fish Lake Levees. 
This system protects 111,700 acres, 288,000 residents and employees, 
and $4.6 billion in property and critical infrastructure. Due to under 
seepage within the system, which increases the risk of failure, the 
Corps in partnership with the local levee district began rehabilitating 
the levee system in 2007 in order to get the levees back into 
compliance with FEMA's 100-year flood protection requirements. Without 
100-year accreditation, approximately 150,000 people and 7,000 
businesses would need to purchase additional flood insurance in an area 
where few can afford it. The Corps and local levee districts have made 
significant investments in the system over the last 7 years, but the 
Metro East Levee system was not included in the proposed fiscal year 
2018 budget. Why wasn't the Metro East Levee System included in the 
President fiscal year 2018 budget despite previous Federal investment 
in the project?
    Answer. The Chain of Rocks Canal deficiency correction project was 
funded to completion in fiscal year 2014. The Wood River Levee 
deficiency correction project was funded to completion in the fiscal 
year 2017 Work Plan. Investigations funds were moved to the Prairie du 
Pont and Fish Lake project in fiscal year 2017 to conduct an economic 
update. The East St. Louis deficiency correction project will be 
considered for future funding following review of the supporting 
decision document.
                                 ______
                                 
              Questions Submitted by Senator John Kennedy
    Question. I was glad to see the Comite River project receive $6.7 
million in the fiscal year 2017 Work Plan. It has taken a long time to 
get here. Unfortunately, it took a major flood in Louisiana for this 
project to even get highlighted again. Knowing time is of the essence, 
what is the actual timeline for when this money can be used for actual 
work on the project?
    Answer. The fiscal year 2017 Work Plan funds allocated for Comite 
are planned for execution by the end of calendar year 2017.
    Question. We have a major problem maintaining our existing 
infrastructure, especially in Louisiana. Due to the under-funding for 
dredging small-to-medium-sized ports along the coast, such as the Port 
of Iberia, Port of Terrebonne, Port of Morgan City, the neglect is 
causing many of these ports to go into a death spiral. When these ports 
and waterways are not maintained, vessels are diverted to larger ports 
along the Gulf Coast. In a sense, the Corps has created an economic 
disadvantage to do business in the heartland of Louisiana's coast. 
Businesses are being forced to close or move elsewhere. What does this 
budget do to address this need? While there are some ports in Louisiana 
that have some revenue to spend to pay for some of the dredging 
themselves, most of them do not since their budgets are stretched thin. 
How are you going to address this need?
    Answer. The Corps focuses funding for maintenance dredging on those 
projects that provide the greatest economic, environmental, and public 
safety returns to the Nation, but also considers many other factors. 
The Budget also provides significant funding for small-to-medium sized 
ports across the Nation.
    Question. Can you provide me an update on how close we are to 
reaching post-Panamax depth (-50 feet) on the Mississippi River? It is 
my understanding that it is still being studied. Can you give me a 
reasonable timeline of when the study be finished and how long it will 
take to start dredging to -50 feet?
    Answer. The Mississippi River Ship Channel, Gulf to Baton Rouge, 
Louisiana General Reevaluation Report was funded to completion in 
fiscal year 2017 and is currently scheduled to complete in fiscal year 
2018. Any future design or construction timeline is dependent on the 
results of the completed study.
    Question. I know the President has stated that infrastructure 
investment is a major priority for his administration. Is the Corps 
actively involved in the President's infrastructure plan in regards to 
updating and improving our waterways? Have you been consulted as 
decisions are made on the overall plan?
    Answer. We are working with the Administration and providing 
technical information, as requested.
    Question. One of the biggest issues I hear from my community 
leaders back home is the lengthy and onerous process to receiving a 
permit from the Corps. Does this budget include relief to help get 
permits out the door faster for local projects?
    Answer. The Corps strives to improve customer service in all its 
programs, including the Regulatory program. However, performance 
targets for issuing general permits as well as the more complex 
individual permits have consistently been exceeded. If there are 
specific issues that you would like to discuss, I would be happy to sit 
down with you to discuss those issues.
                                 ______
                                 
               Questions Submitted by Senator John Cornyn
    Question. In the absence of fiscal year 2017 funds or inclusion in 
the fiscal year 2018 President's Budget, it's imperative that a Project 
Partnership Agreement (PPA) be executed in an expeditious manner to 
begin construction on the Corpus Christi Ship Channel--Channel 
Improvement Project (CCSC-CIP) project this year using locally 
contributed funds. It is my understanding that a draft PPA has been all 
but finalized since March 2017; however, transmittal of that PPA to the 
Corps Galveston District has not occurred, thus further delaying 
construction of the project.
    Please explain the cause of the delay in the finalization and 
transmittal of the PPA to the Galveston District?
    Answer. A project-specific PPA was developed for the CCSC-CIP that 
reflects the project's authorizations. Additional coordination 
regarding pipeline relocations and removals was needed before the draft 
PPA could be transmitted to the Galveston District.
    Question. What are the outstanding issues and when do you expect 
them to be resolved?
    Answer. There are no other outstanding issues.
    Question. Within a week of receipt of these questions please 
provide my office with a specific timeline on when the Galveston 
District will receive the PPA?
    Answer. The Corps will follow up with your office with the current 
status.
                                 ______
                                 
               Questions Submitted to Mr. Douglas Lamont
            Question Submitted by Senator Richard C. Shelby
    Question. Both the Water Resources and Development Acts (WRDA) of 
2014 and 2016 included spending targets related to the Harbor 
Maintenance Trust Fund to ensure that our Nation's seaports dredging 
and maintenance needs are met. However, in recent years, the 
Administration's budget requests have continuously requested funding 
levels well below the targeted levels. Meeting these target levels is 
incredibly important, and Congress has met these targets now 3 years in 
a row. Unfortunately, the Administration's budget proposals, including 
this year, have not.
    Acting Assistant Secretary Lamont, is there a reason why the Corps' 
annual budget request has not met the Harbor Maintenance Trust Fund 
targets?
    Answer. The President's fiscal year 2018 Budget includes $965 
million in HMTF spending, which is the highest amount ever budgeted 
(the fiscal year 2015 and fiscal year 2016 Budgets included $915 
million and the fiscal year 2017 Budget included $951 million). While 
additional funds could be expended for dredging and maintenance of our 
coastal harbors and channels and inland harbors, the fiscal year 2018 
Budget request is an appropriate amount developed through the Budget 
process, which considers other potential uses of the available funds 
both within the Corps Civil Works program and across the Federal 
Government, including the need to reduce the Federal deficit.
                                 ______
                                 
             Question Submitted by Senator Susan M. Collins
    Question. I was grateful that in April the Army Corps and the Navy 
were able to work together and conduct an emergency dredge of the 
Kennebec River to allow the USS Peralta, built by Bath Iron Works, to 
safely traverse the river to the open ocean. Bath Iron Works is one of 
only two shipyards that builds DDG-51 guided missile destroyers for the 
Navy, and it's absolutely essential that these destroyers are able to 
conduct sea trials and ultimately be delivered to the fleet for 
operations across the globe. Twice since 2011, shoaling of the Kennebec 
has required emergency dredging to ensure Navy ships built at Bath can 
reach the open seas. Of course, waiting until a situation becomes an 
emergency is never a sustainable way to deal with any issue. Will you 
work with Congress and the Navy to come up with a permanent solution to 
this reoccurring problem?
    Answer. In my capacity as the Senior Official Performing the Duties 
of the Assistant Secretary of the Army, I engaged Navy leadership 
regarding future Navy ship building operations that may require 
dredging the lower Kennebec River.
    Should future Navy ship building operations require dredging the 
lower reach of the Kennebec River, the Navy will need to be prepared to 
use its appropriations to execute the work, or have other stakeholders 
fund the work using existing Civil Works authorities providing for the 
use of contributed funds. My office will continue to work closely with 
Navy to address future funding, timing and dredging on the Kennebec 
River to support the Navy's ship building operations.
                                 ______
                                 
            Questions Submitted by Senator Dianne Feinstein
              fiscal year 2017 work plan--new study starts
    Question. Mr. Lamont, I am concerned that the Army Corps' fiscal 
year 2017 Work Plan did not align with the Congressional direction 
included in the Omnibus.
    The Work Plan included one new study start, despite the fact that 
Congress provided the Corps up to six new study starts, and 
specifically allocated among navigation, flood reduction, and 
environmental restoration. This Subcommittee would not have 
specifically allocated each of the six new study starts if we did not 
intend for each of them to be utilized.
    I understand that the Army Corps has prioritized studies and 
projects that are already underway. However, many of our communities 
face critical infrastructure and public safety risks that cannot be 
ignored simply because the Army Corps has a backlog of current 
projects.
    How has the Corps decided to balance the need to complete ongoing 
projects vs. newly identified risks that require new studies?
    Answer. The Army carefully considered all potential new start 
studies. However, there are currently over 300 specifically authorized 
investigations activities underway, and over 350 individually 
authorized construction projects at various stages of construction in 
the Army Civil Works portfolio. In the past 5 years, under our SMART 
planning process, the Corps has completed its studies more quickly. 
Over the same period, however, it has completed and fiscally closed out 
comparatively few construction projects.
    Question. Why did the Corps initiate only one new study start in 
the fiscal year 2017 Work Plan despite the Omnibus' clear 
classification of all six new study starts?
    Answer. While we considered funding additional studies, and 
evaluated each potential new study for funding, we decided to focus on 
ongoing studies and pre-construction engineering design work as our 
priority in allocating the Investigations funds added in fiscal year 
2017.
    One impact of the Corps' refusal to utilize all of the new study 
starts authorized by this Subcommittee in the Omnibus hits close to 
home for me.
    In San Francisco, the Embarcadero Seawall provides flood protection 
for my home city's financial district and tens of thousands of people 
every day. However, it is crumbling and in urgent need of repair.
    However, due to the Corps' own bureaucratic hurdles, the Corps 
cannot even begin studying how to repair the wall until it designates 
this study as a new start.
    Question. Given the public safety risks and the potentially 
astronomical recovery costs if the seawall fails, why did the Corps 
choose not to designate the Embarcadero Seawall as a new start, despite 
having six new study starts available?
    Answer. While we considered funding additional studies, and 
evaluated each potential new study for funding, we decided to focus on 
ongoing studies and pre-construction engineering design work as our 
priority in allocating the Investigations funds added in fiscal year 
2017.
    Question. How does the Corps justify refusing to use all 6 new 
study starts available when there are clear public safety risks 
associated with inaction?
    Answer. The Army carefully considered all potential new start 
studies. However, there are currently over 300 specifically authorized 
investigations activities underway, and over 350 individually 
authorized construction projects at various stages of construction in 
the Army Civil Works portfolio. In the past 5 years, under our SMART 
planning process, the Corps has completed its studies more quickly. 
Over the same period, however, it has completed and fiscally closed out 
comparatively few construction projects.
    Question. How does not utilizing 5 of the 6 new study starts 
actually help reduce the Corps' backlog or accelerate progress on 
ongoing projects?
    Answer. The work plan achieves this objective by focusing on 
completing ongoing work.
    Question. If the Corps continues to emphasize ongoing work, how 
will new infrastructure projects compete for funding if the Corps does 
not usher new studies through the project pipeline?
    Answer. We will consider funding new study efforts in the future.
     balancing corps missions: flood risk management and navigation
    Question. Mr. Lamont, I was disappointed to see that the fiscal 
year 2017 Work Plan's use of new construction starts favored navigation 
projects at the expense of flood protection projects.
    Given the significant public safety risks associated with flood 
protection projects, what was the process by which the Corps chose to 
concentrate 4 of their 6 new construction starts on navigation 
projects?
    Answer. We consider funding for each potential new project on its 
own merits.
    Question. I noticed that the fiscal year 2017 Work Plan includes 
new construction starts in Boston, Tampa, Jacksonville, Charleston, 
Kentucky, and Washington. Why were half of new construction starts 
concentrated in the South Eastern United States this year?
    Answer. The Boston Harbor, Massachusetts project is a navigation 
project with a competitive benefit-to-cost ratio. It was selected on 
the basis of its economic justification. The Ohio River Shoreline, 
Paducah, Kentucky project would reduce the risk of flood damage. It was 
selected due to its economic return, which is high relative to many 
other projects, and because the Corps could complete the project with 
the funding provided in fiscal year 2017.
    With regard to the Charleston Harbor, South Carolina, Tampa Harbor, 
Big Bend, Florida and Jacksonville Harbor, Florida projects, the non-
Federal sponsors at each of those ports has voluntarily demonstrated a 
substantial commitment to non-Federal investment via pending or in 
place advanced funds agreements. The non-Federal sponsor of the Tampa 
Harbor, Big Bend project has said that it will cover any remaining 
costs beyond those funded in the fiscal year 2017 work plan.
    Beneficial Use of Dredged Material
    Question. Mr. Lamont, I have been particularly interested in the 
ability of the Corps to use taxpayer dollars efficiently and to pursue 
projects that have multiple benefits.
    For example, I am interested in the Corps' efforts to reuse dredge 
material from a harbor project as fill material for a wetland 
restoration project. I know this is also an issue of great interest in 
California, particularly in the San Francisco Bay area where there are 
multiple ports with dredging needs and multiple wetland restoration 
projects that could use that same dredge material.
    Mr. Lamont, how are you ensuring that such multiple benefit 
projects are being prioritized within the Corps?
    Answer. The Corps strives to use dredged material from its 
navigation projects beneficially and focuses on regional sediment 
management, which looks for sustainable solutions that reduce lifecycle 
costs and increase benefits through more efficient and effective use of 
sediments across Corps civil works projects. In deciding where to place 
dredged material, the Corps will first identify the least cost, 
technically feasible, environmentally acceptable manner, which is 
called the Federal Standard. Beneficial use of dredged material options 
are assessed on a project by project basis. When a beneficial use 
option can be implemented for the same cost or less than the Federal 
Standard, it can be implemented as part of the Operation and 
Maintenance (O&M) dredging project. When a beneficial use option is 
more expensive than the Federal Standard, the additional cost must be 
either cost-shared under one of the Corps authorities or funded by a 
non- Federal sponsor. An example of where a non-Federal sponsor pursued 
a beneficial use project with the Corps under a separate authorization 
was the Hamilton Wetlands Restoration Project. In that case, the Corps 
partnered with the California Coastal Conservancy and received 
authorization for an ecosystem restoration project that resulted in a 
prepared site with the infrastructure necessary to create a least cost 
opportunity for beneficial use of dredged material from O&M navigation 
projects in San Francisco Bay.
    Question. Please provide an update on the Corps' implementation of 
the beneficial use of dredged material provision that was included in 
last year's WIIN Act.
    Answer. The implementation guidance for Section 1122 of WRDA16 is 
under development and our current goal is to finalize that guidance 
this fall.
    Mr. Lamont, I understand that the Corps' own standards can serve as 
an impediment to projects seeking to reuse dredged material for wetland 
restoration.
    Question. How is the Corps working with local project sponsors to 
leverage local funds to jumpstart beneficial reuse projects?
    Answer. A local sponsor can provide funds to pay the additional 
cost above the cost of placement of dredged material per the Federal 
Standard where the cost exceeds the least cost dredged material 
placement alternative. The Corps has worked with local sponsors in the 
past to maximize opportunities for beneficial use.
    Question. How is the Corps implementing a regional approach to 
maintenance needs to best utilize limited resources rather than looking 
at each project individually.
    Answer. The Corps National Regional Sediment Management (RSM) 
Program and the South Atlantic Division RSM Regional Center of 
Expertise work with Corps Districts and their stakeholders to use a 
systems approach to work across multiple projects to manage sediments 
in a manner that maximizes natural and economic efficiencies. From 
2000-2017, 20 coastal districts and 8 inland districts participated in 
the RSM Program and have successfully integrated regional approaches 
that include both new and existing projects. Many tools and 
technologies are available to assist in developing sediment management 
strategies including dredging optimization, regional sediment budgets, 
and many others to aid Districts and stakeholders in establishing and 
operating regional solutions.
    Question. With all of the harbor dredging projects identified in 
the fiscal year 2017 Work Plan, will you be making an effort to reuse 
the dredged material for other projects?
    Answer. The Corps strives to use dredged material from its 
navigation projects beneficially and focuses on regional sediment 
management, which looks for sustainable solutions that are more 
efficient both from a natural and from an economic perspective. The 
Corps is continuously seeking new partnerships where there are such 
opportunities.
                                 ______
                                 
              Questions Submitted by Senator Patty Murray
    Question. On February 11, 2016, I sent a letter signed by 13 of my 
colleagues asking the Army Corps to finalize and publish implementation 
guidance for Section 2106 of the Water Resources and Development Act 
(WRRDA). This Subcommittee secured $25 million in funding for Section 
2106 in the fiscal year 2016 Omnibus Appropriations bill and $28 
million in funding for Section 2106 in the fiscal year 2017 Omnibus 
Appropriations bill. I appreciate the Army Corps' work to allocate this 
funding through the annual Work Plan process, and understand there has 
been positive progress with ports who elect to use this funding to 
maintain infrastructure through expanded uses.
    However, I am frustrated that the Army Corps has still not fully 
implemented the program for ports who elect to use this funding to 
provide rebates to importers transporting cargo through their port. 
Especially after working to make changes to the program in the Water 
Infrastructure Improvements for the Nation (WIIN) Act to make it more 
workable.
    Mr. Lamont, what is the current status of Section 2106 and 
implementation of the rebate portion of the program? Since passage of 
the WIIN Act, have you reengaged with U.S. Customs and Border 
Protection to move forward with full implementation of Section 2106? I 
strongly urge you to complete this work as soon as possible so that 
eligible ports have access to the appropriated funding and can maximize 
the effectiveness of Section 2106.
    Answer. In July 2016, the Corps finalized Implementation Guidance 
for Section 2106 of WRRDA 2014, setting forth how funds were to be 
distributed among the donor ports and energy transfer ports. However, 
the ports could not come to agreement with the U.S. Customs and Border 
Protection as to how rebates would be distributed among the shippers 
and importers. The Corps is still working on completing implementation 
guidance for Section 1110 in the WIIN Act, which amended Section 2106 
of WRRDA 2014.
    Question. Similarly, I am concerned that the Army Corps has not 
fully implemented Section 2102 of WRRDA. Section 2102 authorizes ports 
which generate more Harbor Maintenance Tax (HMT) revenue than the Army 
Corps spends at their ports to direct HMT funds toward two new expanded 
uses--berth dredging and disposal of contaminated sediments. 
Recognizing that the Army Corps had not implemented Section 2102, 
Congress included a provision in the WIIN Act directing the Army Corps 
to publish implementation guidance for Section 2102 within 90 days. 
This 90 day window has now come and gone.
    Mr. Lamont, what is the current status of Section 2102 
implementation guidance? When does the Army Corps expect to complete 
this work? If berth dredging is unfamiliar territory for the Army 
Corps, could you explore issuing a call for projects from eligible 
Section 2102 ports and allow the ports to propose projects for the Army 
Corps' consideration?
    Answer. Implementation Guidance for Section 2102 of WRRDA14 is 
under development and is expected to be completed this fall. Dredging 
of berths is not unfamiliar territory for the Corps and berth dredging 
and expanded uses was addressed in the July 2016 implementation 
guidance for Section 2106 of WRRDA 2014.
    Question. Nearly 3 years after the Northwest reached a regional 
consensus to modernize the Columbia River Treaty, the U.S. notified 
Canada of our intent to begin formal negotiations on the Treaty. Since 
October 2016, we have been waiting for Canada to come to the table.
    Mr. Lamont, I urge you to proactively raise the Columbia River 
Treaty at every opportunity with your Canadian counterparts. Do I have 
your commitment to do that?
    Answer. Yes, we have excellent working relationships with our 
Canadian counterparts and the Columbia River Treaty will continue to be 
discussed at every opportunity. The Corps supports the Department of 
State, which has the actual negotiation authority for the Treaty; and 
has supported Department of State through participation in a 
Collaborative Modeling Workgroup comprised of modeling and policy 
experts from both nations. A broad range of interests are represented 
in this workgroup, including ecosystem function, flood risk management, 
and hydropower. The group is focusing on modeling objectives and 
defining model scenarios.
    Specifically, the Corps has led discussions and shared its 
expertise in the way that hydro regulation computer models are used to 
explore scenarios, then feeding into secondary models that explore 
impacts. The most recent face-to-face meeting of the Collaborative 
Modeling Workgroup was on June 16, 2017, and was hosted by Canada in 
Vancouver, B.C. On October 3, 2017, a longer meeting will be held in 
Portland, Oregon. The Corps is also actively engaged in a smaller, 
Collaborative Modeling Technical Team that meets more frequently; the 
next meeting will occur on August 17, 2017. All of these engagements, 
as well as the regularly scheduled meetings related to ongoing Treaty 
implementation, are venues for keeping the Columbia River Treaty at the 
forefront of our Canadian counterparts' minds.
                                 ______
                                 
              Questions Submitted by Senator John Kennedy
    Question. I understand that we have to be mindful of our spending. 
However, you have considerable authority to work with OMB to have new 
projects receive funds to begin construction. With Congress beginning 
to pass water resources bills every 2 years, with a new one due next 
year to authorize more projects nationwide, how will you address 
prioritizing funds to newly authorized projects?
    Answer. The Budget seeks each year to produce as much value as 
possible for the Nation from the available funds. For example, projects 
that met the construction performance guidelines laid out on page 52 of 
the fiscal year 2018 Civil Works Budget Press Book received priority 
consideration for funding in the fiscal year 2018 Budget.
    Question. As a follow-up to my last question, Louisiana has major 
projects in Louisiana that need to begin construction immediately, 
projects like, Morganza to the Gulf, Southwest Coastal, West Shore 
Hurricane Protection System, and so on. In my opinion, we can spend 
millions now to protect or spend billions later to recover. How are you 
going to address this challenge to start putting shovels in the ground 
and build these projects in a timely manner?
    Answer. These projects will be considered for future funding along 
with other programs, projects, and activities across the Nation in 
competition for available Federal resources.
    Question. The Rivers and Harbors Act of 1899 (Section 408, as it 
appears in the United States Code) granted the Corps broad authority to 
invest and regulate waterways for the purposes of commerce and 
navigation. It was not until the Flood Control Act of 1928 that the 
Corps addressed their authority to regulate and invest in waterways for 
flood control. The Flood Control Act, and subsequent revisions to it, 
held that the Corps was an advisory authority to local levee districts 
not a permitting authority. Congress has always held that flood control 
is a matter best managed at the State and local level. The Corps has 
been using Section 408 to stall dredge and fill permits, 404 permits. 
This is holding up local levee boards in Louisiana, with costly and 
lengthy environmental reviews that often takes years to complete in 
order to get permits that otherwise should not exist. Meanwhile, people 
are left vulnerable to flooding and are exposed to having to pay higher 
flood insurance premiums. Given that the River and Harbors Act gave the 
Corps the authority to regulate navigation, and the Flood Control Act 
of 1928 gave the Corps the authority to regulate flood control, what is 
the Corps doing to harmonize these two objectives?
    Answer. The Rivers and Harbors Act of 1899 includes several 
sections that give the Corps of Engineers separate and distinct 
authorities. Sections 9 and 10 of the Rivers and Harbors Act of 1899 
give the Corps the authority to regulate work and structures in 
navigable waters in general. One of the primary purposes of those 
sections was, and remains, maintaining the navigable capacity of U.S. 
navigable waters, and preventing obstructions to navigation. Section 14 
of the Rivers and Harbors Act of 1899, codified at 33 U.S.C. Section 
408, gives the Secretary of the Army authority, acting through the 
Chief of Engineers, to grant permission for the alteration, permanent 
or temporary occupation, or use ``of any of the aforementioned public 
works when in the judgment of the Secretary, such occupation or use 
will not be injurious to the public interest and will not impair the 
usefulness of such work.'' The Section 408 authority is limited to the 
Corps' Congressionally-authorized Civil Works projects. Without 
permission from the Corps, Section 408 expressly prohibits ``any person 
or persons to take possession of or make use of for any purpose, or 
build upon, alter, deface, destroy, move, injure, obstruct by fastening 
vessels thereto or otherwise, or in any manner whatever impair the 
usefulness of any sea wall, bulkhead, jetty, dike, levee, wharf, pier, 
or other work built by the United States.'' Thus, section 408 applies 
to a wide range of works constructed by the Corps, and is not limited 
to navigation structures. As part of the evaluation under Section 408, 
the Corps considers whether any alteration or modification will impair 
the usefulness of a given project, relying on previous Congressional 
authorization. For example, in the case of flood control works on the 
Mississippi River and its tributaries, authorized as part of the Flood 
Control Act of 1928, the Corps ensures that any request under Section 
408 to modify or alter those flood control works would be consistent 
with any applicable requirements in the Flood Control Act of 1928.
    The Corps is taking steps to address concerns about its 
decisionmaking process under Section 408. In those cases where an 
activity that requires Section 408 authorization also requires a 
``dredge and fill permit'' under Section 404 of the Clean Water Act, 
the Corps staff responsible for the Section 408 and Section 404 reviews 
collaborate during their respective reviews, sharing information to 
reduce duplication of effort. In these cases, the Corps will first 
issues the Section 408 decision. It does so because the Section 404 
implementing regulations prohibit the Corps from granting a Section 404 
permit that could interfere with a Federal project, such as a Corps 
Civil Works project. That determination occurs through the Section 408 
review.
    In addition, the Corps is evaluating and updating its policy and 
procedures governing Section 408 permissions to better align with other 
Corps authorities, institute timelines from Section 1156 of the Water 
Resources Development Act of 2016, improve nationwide consistency, and 
delegate decisionmaking to the appropriate level. The desired outcome 
of this effort is greater efficiency and timeliness in decisionmaking, 
without sacrificing the quality of the evaluation.
    Question. Further, would having a 408 permit from the Army Corps of 
Engineers have an impact on FEMA levee accreditations, which would 
affect rates people pay through the National Flood Insurance Program?
    Answer. Before a non-Federal sponsor who operates and maintains a 
federally authorized levee can alter the levee, it is required to 
receive a Section 408 approval from the Corps. For example, if a non-
Federal sponsor of such a levee wished to raise the height of the levee 
or otherwise modify the levee to meet NFIP accreditation requirements, 
it would first seek Section 408 permission from the Corps. A Section 
408 permission can be granted if the levee raise does not impact the 
usefulness of the levee or any other of the works covered by Section 
408 and is not injurious to the public.
    By contrast, if this non-Federal sponsor were instead to alter that 
levee without receiving permission under Section 408, the alteration 
could potentially contribute to an unacceptable levee system rating by 
the Corps, which in turn could affect FEMA's determination on NFIP 
accreditation.
    Question. I want to broaden my questions regarding the National 
Flood Insurance Program and the Corps role in how FEMA constructs their 
flood maps. Can you tell me how the Corps plays a role in FEMA's 
mapping process?
    Answer. Both the Corps and FEMA have a long history of partnering 
on flood plain mapping as part of the NFIP. Over the past 30 years, the 
Corps has completed thousands of studies for FEMA related to 
identifying the flood potential of various areas across the country. 
These studies involved activities such as flood plain delineations and 
detailed flood insurance studies. In August 2005, both agencies signed 
an agreement that further streamlined the process for the Corps to 
provide flood plain mapping and other related services to FEMA. In 
addition, the Corps and FEMA have entered into subsequent agreements 
that promote and foster information sharing and coordination between 
the two agencies.
    The Corps cooperates with FEMA and other Federal, State, and local 
agencies through different avenues in support of FEMA's mapping 
process. These include:
  --Participating in joint meetings and coordination efforts;
  --Providing best available hydraulic and hydrologic models and 
        topographic mapping;
  --Performing new flood plain mapping studies or providing technical 
        assistance directly for FEMA using funds provided by FEMA under 
        the authority of the Economy Act;
  --Working through partnerships with State and local governments under 
        the Floodplain Management Services (FPMS) or Planning 
        Assistance to States (PAS) Programs;
  --Providing available dam and levee information collected through the 
        Corps Dam and Levee Safety Programs;
  --Sharing information collected during more detailed flood risk 
        management studies; and Serving as an active and standing 
        member of the Technical Mapping Advisory Council (TMAC)--a 
        Federal advisory committee established to review and make 
        recommendations to FEMA on matters related to the national 
        flood mapping program authorized under the Biggert-Waters Flood 
        Insurance Reform Act of 2012.
    Question. Is there anything in statute that tells you that you are 
unable to provide information on non-Federal levee systems, 
deauthorized levees or flood risk reduction systems, or non- structural 
surge protection (such as, wetlands, elevated railroads and highways, 
etc.) for FEMA to take into consideration when they are calculating 
risk drawing new flood maps and calculating risk?
    Answer. No.
                                 ______
                                 
               Questions Submitted by Senator John Cornyn
    Question. The CCSC-CIP project has had to jump through several 
hoops over the years, including Congressional reauthorization, a 
determination of whether the remaining elements would be considered a 
``new start,'' and a Limited Reevaluation Review (LRR).
    The December 2015 Limited Reevaluation review states, ``Each of 
these measures was individually justified and all are considered 
separable elements.''
    Are you familiar with this project's determination? Has that 
determination pertaining to the project elements been changed?
    Answer. Yes, I am familiar with the review. That determination has 
not changed.
    Question. In your opinion, would each separable element be 
considered an individual project?
    Answer. In this case, we concluded that Corpus Christi would not be 
subject to a new start determination.
    Based on that 2015 LRR, on page 103, the BCR for Separable Element 
#1 (deepening and widening) at 7 percent is 2.64 to 1 and the Barge 
Shelves is 18.29 to 1.
    Question. In your opinion, would each of these projects 
individually meet the Budgetary Construction Performance Guideline 
requiring a 2.5 to 1 BCR established by your office?
    Answer. For purposes of the Budget, the BCR for the entire project 
is what is used to justify projects in the Budget on the basis of their 
economic return.
    Question. Would each of these projects require a ``new start'' 
determination to receive Federal dollars?
    Answer. No.
    Section 1146 specifically states,
    ``With respect to a water resources development project that has 
received construction funds in the previous 6-year period, for purposes 
of initiating work on a separable element of the project--
    (1) no new start or new investment decision shall be required; and
    (2) the work shall be treated as ongoing work.''
    Question. Therefore, if each of these projects are considered 
separable elements per the 2015 LRR and there has been no change in 
statute making these two elements one single project, please explain 
why the Corps is requiring another economic review to determine a total 
project BCR for budgetary purposes rather than using the individual 
BCRs for each separable element?
    Answer. It is standard practice in the Budget for all budgeted 
projects funded on the basis of their economic return to meet a minimum 
BCR of 2.5 at a 7 percent discount rate for the whole project.
    As I understand it, both of these projects--as separable elements--
clearly meet the budget criteria set by your office, individually and 
together, yet have been passed over for Federal funding.
    Question. Please explain the reason for this as I have constituents 
in my State depending on this project to increase jobs and grow our 
economy.
    Answer. The Corps completed a reevaluation of the economics for 
this project, and determined that the BCR for the whole project is 
currently 2.65 at a 7 percent discount rate.
                                 ______
                                 
              Questions Submitted by Senator John Isakson
    Question. In several cases in your fiscal year 2017 work plan you 
chose to initiate new deep draft navigation construction projects using 
the additional funding provided by Congress for fiscal year 2017 rather 
than using those funds to advance and complete construction of projects 
already underway. It would seem that a more prudent business decision 
would have been to finish ongoing projects as efficiently and quickly 
as possible so that the Nation can begin realizing the projects' 
benefits. Do you believe that the language in the fiscal year 2017 
appropriations act compelled you to initiate those new projects in the 
work plan rather than simply permitting you to do so?
    Answer. No.
    Question. Considering the number of deep-draft navigation projects 
that have been authorized but have not begun construction, and 
considering the fact that your fiscal year 2018 budget request made 
significant cuts to the Corps compared to prior year budgets, why did 
you add new projects in the work plan rather than fund on-going 
projects to their full capability?
    Answer. We do not expect there to be any out-year Federal funding 
requirements for the Ohio River Shoreline, Paducah, Kentucky or the 
Tampa Harbor, Big Bend, Florida projects. The non-Federal sponsors for 
both the Charleston Harbor and Jacksonville Harbor projects have 
advanced funds agreements either pending or in place, which will allow 
them to fund these projects.
    Question. Did your office verify that all projects funded in the 
fiscal year 2017 work plan could fully utilize the allocated funds 
during fiscal year 2017? If any project is unable to do so, can the 
committee be assured that remaining funds would be redirected to other 
projects which are able to utilize those funds in fiscal year 2017?
    Answer. Projects were provided more funds in some cases to complete 
a useful increment of work.
    Question. Does the inefficiency of under-funding ongoing projects 
below standard Corps capability add to the cost of completing those 
projects?
    Answer. There are many variables that impact cost growth on 
construction projects. Cost growth has been a systemic concern, which 
receives senior leadership attention across a wide spectrum of 
projects. As part of this effort, the Corps has established Cost 
Control Boards for projects whose cost increases exceed a set 
percentage of the overall project cost in a single year.
    Question. 5: On average, how much longer would it take you to 
complete on-going deep draft coastal navigation projects based on 
continuing the current reduced level of funding as compared to funding 
those projects to standard full capability?
    Answer. We do not have such an estimate. Funding streams and 
sources vary considerably across projects and years, and are not 
limited to the funds requested in the Budgets.
                                 ______
                                 
               Questions Submitted to Mr. Alan Mikkelsen
            Questions Submitted by Senator Dianne Feinstein
                      subsidence/friant kern canal
    Question. Subsidence is a severe problem in California's San 
Joaquin Valley. Many areas have dropped by 18 to 24 inches in just the 
last few years alone due to the drought and excessive water pumping.
    In some cases, this subsidence has damaged the ability of Federal 
and State infrastructure to operate properly. For example, subsidence 
has reduced the water carrying capacity of the Friant- Kern Canal by 60 
percent in some places, severely disrupting water supply and 
groundwater recharge operations throughout the Friant Division of the 
Central Valley Project.
    Mr. Mikkelsen, I know that Reclamation is working on this problem. 
What resources and authorities does Reclamation have or need to address 
this problem in both the short-term and the long-term?
    Answer. Reclamation is working with the Friant Division long-term 
contractors to better understand the subsidence challenge along the 
Friant-Kern Canal and determine possible means of addressing the 
situation. In 2010, the San Joaquin River Restoration Program evaluated 
flow constrictions along the entire canal. Preliminary analysis 
determined that authorized funding was not enough to fix the full 
length of the canal and therefore, the analysis was focused on the 
first constraints in the upstream sections of the canal with the goal 
of achieving the broadest benefits to the majority of the Friant 
contractors. Further analysis of these upstream constraints indicated 
that authorized funding was not enough to fix this section. Reclamation 
put the project on hold to conserve the authorized funding and began 
working with the Friant contractors to explore other opportunities to 
increase the available water supply to the Friant contractors.
    After several years of extreme drought, downstream portions of the 
canal dropped up to three feet between approximately Mile Posts 98 to 
112. In January 2017, flows of 1,900 cubic feet per second or less than 
half the design maximum capacity wetted the bottom of five bridges 
downstream from Mile Post 98.
    In early 2017, Reclamation began working with the Friant 
contractors to better understand this subsidence challenge. As part of 
this new effort, Reclamation recently completed a brainstorming session 
with the Friant contractors and is working with the contractors on next 
steps. Reclamation has a variety of resources and authorities to 
address the subsidence challenge, each of these with their own pros and 
cons for Reclamation and the Friant contractors to consider. As we are 
very early in identifying the challenge and possible solutions in this 
area of the canal, we have not yet assessed our full suite of resources 
and authorities to determine if we have the resources and authorities 
to address the problem in the short-term and long-term.
    Question. I believe the Bureau of Reclamation absolutely must 
invest in new groundwater recharge projects to prevent further 
subsidence. I understand you can do so through the Drought Response 
Program within WaterSMART as well as the new storage program created in 
the WIIN Act.
    Mr. Mikkelsen, what actions have you taken to identify the most 
effective groundwater recharge projects and to prioritize them for 
funding?
    Answer. In April 2015, Reclamation completed an ``Investment 
Strategy'' as part of our efforts to implement the Water Management 
Goal under the San Joaquin River Restoration Program. This effort 
included a variety of projects, including groundwater recharge 
projects, that work to increase water supply or more efficiently use 
the existing supplies in the Friant Division of the Central Valley 
Project. The Investment Strategy is available here: http://
www.restoresjr.net/download/program-documents/program-docs-2015/
FinalInvestmentStrategy_20150403.pdf.
    Reclamation developed the Investment Strategy to identify projects 
that, in conjunction with other activities occurring to support the 
Restoration Program's Water Management Goal, could cost effectively 
reduce or avoid water supply impacts to the Friant Division long-term 
contractors as a result of the Restoration Program. A prioritized list 
of implementable projects was developed, evaluated, and prepared to 
help achieve this goal. Projects evaluated for the Investment Strategy 
were ranked on their cost-effective ability to reduce impacts from the 
Restoration Program. However, this ranking is widely applicable and 
identifies the most effective projects, including groundwater recharge 
projects, which could also work to increase water supply or more 
efficiently use the existing supplies in the Friant Division.
                    revisions to biological opinions
    Question. Last year, the Bureau of Reclamation started the process 
of revising the biological opinions for California's Central Valley 
Project and State Water Project.
    I believe there is an opportunity here for a win-win outcome that 
would benefit both the water users and the endangered salmon and smelt. 
And that is focusing on some of the other factors besides water pumping 
that harm the fish: factors like pollutants, predators, poor habitat, 
and lack of food supply.
    Mr. Mikkelsen, how are you prioritizing and investing in the 
science necessary to address pollutants, predators, and these other 
factors aside from water pumping that responsible for harm to fish?
    Answer. Reclamation science funding is focused primarily on habitat 
improvement and food supply augmentation. Work on pollutants and 
predation has received lower priority in part because it is being 
supported by other partner entities (e.g., California Department of 
Water Resources--CA DWR, Central Valley Regional Water Quality Board, 
Delta Regional Monitoring Program, and the State and Federal 
Contractors Water Agency.
    The science focused on habitat restoration includes: studies in 
support of a Reclamation- led effort to reintroduce winter-run Chinook 
salmon upstream of Shasta dam (a requirement under the National Marine 
Fisheries Service 2009 biological opinion); studies documenting salmon 
response to spawning gravel and side-channel enhancement projects in 
the upper Sacramento, American and Stanislaus rivers (in coordination 
with the Central Valley Project Improvement Act Anadromous Fish 
Restoration Program); research in support of efforts to improve fish 
passage through and habitat quality in the Yolo bypass; and research on 
physical and biological process operating in the Cache Slough complex, 
to support tidal wetland restoration called for in the 2008 Fish and 
Wildlife Service biological opinion.
    On the food supply front, Reclamation provides partial funding for 
a CA DWR-led effort to study the effects of re-routed Colusa basin 
drain water on phytoplankton, and zooplankton production in the North 
Delta (part of the Delta Smelt Resiliency Plan); and is working closely 
with the City and Port of West Sacramento on a study to assess the 
viability of routing Sacramento River water down the Sacramento Ship 
Channel to boost Bay-Delta phytoplankton and zooplankton production. 
This effort also includes water quality and fish passage improvement 
components.
                         water storage projects
    Question. Between the recent $2.7 billion bond measure passed by 
California voters and the WIIN Act passed by Congress last year, we 
finally have the opportunity to build major surface and groundwater 
storage projects.
    The WIIN Act authorizes $335 million for Reclamation to partner 
with States to build these projects, and Congress funded the first $67 
million tranche of storage funding in the fiscal year 2017 Omnibus.
    Mr. Mikkelsen, what steps have you taken to ensure that Reclamation 
will finish its feasibility studies as quickly as possible so that you 
can submit recommendations to Congress on which storage projects should 
receive Federal funding?
    Answer. Reclamation has compressed surface storage feasibility 
investigation schedules for CALFED storage Feasibility Reports as 
follows: The North-of-Delta Offstream Storage Investigation Draft 
Feasibility Report was provided to the Sites Joint Powers Authority 
(SPA) in July 2017, to support their Proposition 1 funding application. 
We are currently planning to provide revised reports to the SPA in 
August 2018, to support coordination on the State funding decision. For 
the Upper San Joaquin River Basin Storage Investigation, the 
Feasibility Report is being amended to include a locally-preferred 
alternative operational scenario and our current plan is to make that 
report available in August 2018. Los Vaqueros Phase 2 is planned for 
completion in December 2018. Reclamation is also considering other 
eligible projects in the 17 Western States for funding recommendations 
to Congress. Final recommendations are subject to final review and 
approval within the Administration. Nevertheless, we will continue to 
work diligently to complete studies within the times set out by 
Congress.
    Question. Mr. Mikkelsen, have you begun engaging with the State of 
California in order to align your Federal process and funding timelines 
with California's?
    Answer. Yes, Reclamation is closely coordinating with the local 
Joint Powers Authorities and realigning schedules to meet California 
Water Commission (CWC) timeframes. Water Storage Investment Program 
applications for the three aforementioned surface storage 
investigations will be submitted to the CWC on August 14, 2017, to meet 
the requirements of Proposition 1 bond funding. These applications will 
include study information developed for the Federal feasibility reports 
that are nearing completion. State funding decisions on cost-share for 
these projects are expected from the CWC in mid-2018.
                          desalination funding
    Question. Given the recent drought and the need to prepare for the 
next drought, California must invest in new water infrastructure. I am 
convinced that desalination is a key part of that infrastructure. 
Desalination is still expensive, but graphene and other technological 
breakthroughs to replace the current reverse osmosis process are within 
our grasp.
    Congress passed the WIIN Act last December, which included new 
authorities for the Bureau of Reclamation to establish a competitive 
grant program for desalination. In the fiscal year 2017 Omnibus, 
Congress then appropriated $6 million for this new desalination grant 
program.
    Mr. Mikkelsen, will you commit to expedite Reclamation's 
development of evaluation criteria for the desalination program and 
recommend specific desalination projects for funding as quickly as 
possible?
    Answer. Yes, Reclamation is committed to expediting the 
implementation of new programs from the Water Infrastructure 
Improvements for the Nation, or WIIN, Act amendments, including a new 
desalination grant program. The framework for the desalination program 
is already under development and Reclamation expects to post a funding 
opportunity announcement for desalination projects in the second 
quarter of fiscal year 2018. Reclamation believes this schedule will 
allow for additional outreach and will result in a larger pool of 
eligible applicants.
    Reclamation will satisfy the intent of Congress with regard to 
construction under the WIIN desalination provision with the $6 million 
provided.
    In addition, and as you stated in your question, desalination is 
still expensive, but technological breakthroughs to replace the current 
reverse osmosis process may be within our grasp. The Administration 
believes that an important Federal role within sectors such as this one 
is to fund high-risk, high-reward basic research that has the potential 
to achieve breakthroughs that can revolutionize current processes and 
provide broad public benefits. To this end, a significant portion of 
Reclamation's R&D funding under the Desalination and Water Purification 
Research program will be set aside for these types of research 
projects, and such projects will receive special consideration relative 
to funding additional work at traditional and expensive desalination 
projects.
                        water recycling projects
    Question. Commissioner Mikkelsen, section 4009(g)(2) of the WIIN 
Act says that water reuse projects that have a completed feasibility 
study can ``only receive funding if enacted appropriations legislation 
designates funding to them by name, after the Secretary recommends 
specific projects for funding pursuant to subsection (f),'' which 
mandates that the Secretary establish a new water reuse competitive 
grant program, ``and transmits such recommendations to the appropriate 
committees of Congress.''
    Mr. Mikkelsen, what steps are you taking to complete these 
requirements, submit your recommendations for the water reuse projects 
that should receive funding, and do so in time for this Committee to 
consider and act upon your recommendations in the fiscal year 2018 
appropriations process?
    Answer. Reclamation posted a funding opportunity announcement for 
WIIN Act water recycling projects on July 17, 2017. In order to meet 
the appropriations schedule, the funding opportunity is open for a 
limited time-frame of 30 days, with applications for funding due on 
August 17, 2017.
    Question. Mr. Mikkelsen, I worked very hard to expand Title XVI in 
the WIIN Act so that Reclamation could partner with local water 
agencies to accelerate work on a number of important, large-scale, 
regional water reuse projects throughout California and the West. We 
need the Secretary's recommendations by the end of September. The 
implications of missing our deadline is that implementation will be 
delayed until fiscal year 2019. That's unacceptable.
    Mr. Mikkelsen, will you commit to sending this Committee your 
recommendations, as required by the WIIN Act, before October 1?
    Answer. Reclamation has an accelerated schedule in place to 
complete the competitive selection process required by the statute as 
soon as possible. An expedited review will be conducted with the fiscal 
year 2018 appropriations process in mind.
    Question. Mr. Mikkelsen, I am also concerned about reports that 
Reclamation may seek to limit the eligibility for funding under any 
Funding Opportunities Announcement to implement the new Title XVI WIIN 
Act authority. I understand there have been discussions within 
Reclamation to limit applicants to those entities with a completed and 
approved water reuse Feasibility Study several months prior to the 
release of the FOA.
    Please confirm that any water reuse project that has a completed 
and Reclamation- approved water reuse Feasibility Study on or before 
the deadline for responses to the FOA will be eligible to respond and 
receive funds made available for this new initiative in fiscal year 
2017.
    Answer. The FOA that Reclamation posted on July 17, 2017 states 
that a project must have a Reclamation-reviewed feasibility study and 
the findings of Reclamation's review must have been transmitted to 
Congress by the date that the FOA was posted (i.e., July 17, 2017). The 
initial list of eligible projects was provided to Congress on July 12, 
2017. Completed feasibility studies up to July 3, 2017, were included 
in the letter to Congress. Accordingly, under Reclamation's approach, 
entities with feasibility studies that were found complete just two 
weeks before the FOA was released, are eligible to apply for funding. 
This approach ensures clarity for project sponsors so that no applicant 
spends resources to prepare a proposal until review of the feasibility 
study for that project has been completed.
                 san joaquin river restoration program
    Question. In 2015, Reclamation's ``Revised Framework for 
Implementation of the San Joaquin River Restoration Program'' 
identified a remaining Federal funding need of approximately $1.1 
billion to implement the program by 2029 (2015 Revised Framework for 
Implementation, Table 3-7, page 3-12). Reclamation's Framework also 
said that the existing appropriations authorization for the program is 
insufficient. (Framework Table 3-7; Reclamation Commissioner's 
responses to questions on the fiscal year 2016 budget, question 8, page 
4).
    Mr. Mikkelsen, how does Reclamation plan to address this funding 
need?
    Answer. Reclamation is currently leading a collaborative effort 
with the U.S. Fish and Wildlife Service, National Marine Fisheries 
Service, California Department of Fish and Wildlife, and California 
Department of Water Resources to implement the San Joaquin River 
Restoration Program. Through these partnerships, along with the parties 
to the Settlement in NRDC, et al., v. Rodgers, et al., and the 
downstream landowners and water districts (generally referred to as the 
``Third Parties''), Reclamation will be able to determine the 
Restoration Program actions that can be achieved within the Program's 
current and anticipated future funding sources. We are working to 
ensure that this effort identifies a realistic and achievable path 
forward for the Restoration Program. We anticipate completing this 
effort in early November 2017.
                                 ______
                                 
              Questions Submitted by Senator Patty Murray
    Question. Mr. Mikkelsen, farmers in the Odessa Subarea of the 
Columbia Basin Project have faced significant challenges for several 
years as groundwater from the aquifer has been declining. This rapid 
decline has put agriculture production and commercial, municipal, and 
industrial water uses at risk. According to a study conducted by 
Washington State University, $840 million and 3,600 jobs are at risk if 
agriculture producers in the Odessa Subarea no longer have access to 
groundwater from the aquifer and no alternative water solution is in 
place.
    I appreciate your ongoing work with the State of Washington and the 
impacted irrigation districts to prevent further depletion of the 
Odessa Subarea aquifer and deliver much needed surface water to 
agricultural lands within the Columbia Basin Project. Renewing the 
Master Water Service Contract with the East Columbia Basin Irrigation 
District (ECBID) in 2015 was a significant milestone in this process. 
This ensured ECBID could move forward with the development of the first 
of seven planned pressurized delivery systems to provide surface water 
to 87,700 acres of the Odessa Subarea in the Columbia Basin Project. I 
understand that additional amendments to the Master Water Service 
Contract are needed. What is the current status of this amendment and 
when do you expect it to be completed?
    Answer. The Renewal Master Water Service Contract (RMWSC) provided 
ECBID sufficient water for the 47.5 system, the first of what is 
expected to be eight lateral systems, this one currently designed to 
deliver water to about 8,500 acres, which is currently under 
construction. Depending on what system they start next, ECBID may have 
sufficient water for that as well. Also, Reclamation plans to amend the 
RMWSC to authorize ECBID to provide irrigation water service to an 
additional 70,000 acres in order to provide the full groundwater 
replacement to 87,700 acres within the Odessa Subarea. Reclamation sent 
a proposed contract amendment covering the 70,000 acres to ECBID in 
October 2016. The ECBID provided verbal feedback to Reclamation in 
January 2017. Two public negotiation sessions were held on July 17, 
2017 and July 24, 2017; both parties have agreed to some minor language 
changes and are currently in the process of exchanging revised language 
for a few other sections. ECBID has also requested that Reclamation 
consider several water service proposals that are outside the current 
scope of the contract. Approval of these proposals would require 
additional environmental compliance, a change to the existing 
negotiation parameters for the contract amendment, and in some cases 
policy changes. Reclamation is currently awaiting a response from ECBID 
as to whether or not they desire to have Reclamation consider these 
additional proposals now, which could delay execution of the contract 
amendment by at least 6 months, or if they want to proceed with 
finalizing the RMWSC amendment for the 70,000 acres now and address 
these additional proposals through a separate amendment. If ECBID 
chooses to defer their additional requests to another amendment, we 
anticipate being able to execute a revised contract amendment within 2 
months of being notified of their decision.
    Question. Staying on the subject of the Odessa Subarea, I 
understand that in its current form the ``Record of Decision for the 
Odessa Subarea Special Study Final Environmental Impact Statement'' 
prevents the Bureau of Reclamation from including funding for the 
Odessa Subarea project in its annual budget request and also from using 
funding provided by Congress for Additional Funding for Ongoing Work 
within the Water and Related Resources account. Further, I understand 
that in order to consider Federal funding for the Odessa Subarea 
project, the Bureau of Reclamation would need to reevaluate the 
financial and economic justifications and essentially update the 
benefit-cost ratio. The East Columbia Basin Irrigation District has 
requested a review of the benefit-cost ratio, and has provided the 
Bureau of Reclamation with documentation. Mr. Mikkelsen, what is the 
current status of the Bureau's review of the benefit-cost ratio and 
when do you expect it to be completed?
    Answer. The Record of Decision prevented Federal funding because 
the benefit-cost ratio was less than 1:1. Reclamation has been 
carefully reviewing this information and determining the best course of 
action, keeping in mind time constraints and costs. Reclamation will 
then inform ECBID, the State of Washington, and other stakeholders of 
the outcome of this review and our path forward.
    Question. Nearly 3 years after the Northwest reached a regional 
consensus to modernize the Columbia River Treaty, the U.S. notified 
Canada of our intent to begin formal negotiations on the Treaty. Since 
October 2016, we have been waiting for Canada to come to the table.
    Mr. Mikkelsen, I urge you to proactively raise the Columbia River 
Treaty at every opportunity with your Canadian counterparts. Do I have 
your commitment to do that?
    Answer. While Reclamation is not the entity responsible for 
negotiations, the entities involved are the United States Army Corps of 
Engineers, Bonneville Power Administration, and the United States 
Department of State, I will encourage my Canadian counterparts to 
participate in negotiations as soon as possible, whenever the 
opportunity arises.
                                 ______
                                 
                Questions Submitted by Senator Tom Udall
                        tribal water settlements
    Question. Mr. Mikkelsen, in your testimony you mentioned a number 
of times the importance of maintaining our commitments to tribes by 
fully funding Tribal water settlements. I could not agree more. I did 
notice however that the fiscal year 2018 budget proposes to cut funding 
for the Navajo- Gallup Water Settlement by over $20 million dollars 
compared to fiscal year 2017.
    In addition, there are major reductions in funding to other tribes 
in the BIA water settlements' account to operate and maintain water 
projects that were built according to the terms of the settlements and 
whose construction was paid for from BOR's funds.
    Let's be clear, we need to support all our Tribal water 
settlements. And we should not cannibalize some settlements in order to 
start others. But we need to do so in a way that will not undermine the 
solid progress projects like Navajo-Gallup have made and will not shift 
funds to the out-years. I am leery of shifting our annual 
responsibility to these settlement to the out-years--like a balloon 
payment on a mortgage, as this budget proposes.
    Knowing the members of this committee, I believe they will want to 
uphold our commitments to the tribes--and we'll work to find money for 
all the projects which Congress has authorized.
    Will you commit to equitably allocating and distributing that money 
to all the projects, as Congress directs?
    Answer. The Bureau of Reclamation is committed to fulfilling all of 
our Tribal water settlements within the times specified within the 
individual public laws governing their completion as specified by 
Congress.
    Specifically with respect to the Navajo-Gallup Water Supply 
Project, the project is on schedule to complete its work by the end of 
2024. The President's budget request for the project in fiscal year 
2018, though somewhat less than in past years, is supplemented by the 
remaining mandatory funds that were made available by Congress under 
Title VII of the Claims Resolution Act, Public Law 111-291.
    Question. And will you commit to keep budgets honest and putting 
those costs in over a number of years--not just shifting them to the 
out-years in future budgets?
    Answer. Yes, we will, both for prudent budgetary considerations and 
for maintaining efficient and timely construction schedules. Congress 
specifies the time by which the construction portion of the water 
rights settlements is to be met. Once the planning is complete and 
other laws, such as the National Environmental Policy Act, are met, 
construction, to be efficient, must be maintained at reasonable levels 
and that requires a sufficient appropriation.
    For example, in a non-construction water rights settlement, the 
Taos Pueblo Indian Water Rights, Reclamation was required to make 
available $20.0 million by the end of fiscal year 2016. Both the BIA 
and Reclamation fulfilled, in addition to the monetary requirements, 
all of the conditions precedent. The Secretary issued the public notice 
that the conditions precedent had been met in late 2016. The $20.0 
million was budgeted by Reclamation and appropriated by Congress over a 
period of 5 years at a rate of about $4.0 million per year.
                       navajo generating station
    Question. Mr. Mikkelsen, I noticed yesterday that an agreement was 
reached in order to keep the Navajo Generating Station open for two 
more years--until 2019--which is very helpful to those communities in 
the short term. Thank you for going out and listening to them about 
their needs and concerns.
    I am concerned however, that in the long run, changes in operation 
at the Navajo Generating Station will drastically shift the economy of 
the four corners region. And yet there has been little planning in the 
region to prepare for a transition. Because of the Federal Government's 
tribal trust, fiduciary, and environmental responsibilities, the 
Department of the Interior and the Bureau of Reclamation have been key 
to the discussions on the future of NGS.
    What options are being considered for workforce planning and 
transition when and if, the NGS and/or other power plants in the region 
close?
    Answer. The Department of the Interior and the Bureau of 
Reclamation (Reclamation) have interacted extensively with Arizona 
stakeholders who benefit from or who are impacted by Navajo Generating 
Station (NGS) operations. Forty-plus years of coal-fired electric 
generation in northeastern Arizona has produced a regional coal-centric 
economy. Southwestern electric utilities, however, are adapting to 
changes in the energy market which over the past 10 years have resulted 
in substantial retirements and reductions of coal generation 
facilities.
    The Navajo Nation and Hopi Tribe have initiated accelerated steps 
to address economic development and diversification in northeastern 
Arizona by requesting government-to- government consultations and 
technical assistance from Federal agencies and universities. 
Reclamation has enlisted energy market experts and provided financial 
and technical assistance to both tribes. Reclamation has an extensive 
history working with northeastern Arizona stakeholders investigating 
water development. In order to support workforce planning and 
transition, Reclamation has provided technical assistance to the tribes 
in the development of renewable energy generation and regional water 
supply on the reservations. The tribes have requested specific 
assistance in planning which is required for economic development and 
diversification. The NGS replacement lease (July 2017) contains 
provisions for the Navajo Nation to obtain ownership of various plant 
assets (the Lake Powell water pumping station, coal supply train, 
buildings and transmission access) as part of an economic development 
roadmap.
    Reclamation's technical assistance team includes the National 
Renewable Energy Laboratory and universities with energy development 
expertise. The Navajo Nation, Hopi Tribe, and the Reclamation team are 
actively investigating water and electric generation project 
development as part of a transition strategy in response to changing 
NGS operations.
    Question. How can we work together to make sure we are putting 
tribes, taxpayers and the environment first in addressing this issue?
    Answer. On March 1, 2017, the Department of the Interior (DOI) and 
Reclamation initiated a facilitated stakeholder process to evaluate 
future NGS operations options. Several subgroups were formulated to 
simultaneously; (1) develop terms and conditions for operation of the 
NGS to the end of 2019 and, if necessary, decommission thereafter; (2) 
research potential owners and energy buyers to continue operations 
post-2019; and (3) identify strategies to minimize the socio- economic 
impacts of a potential NGS closure.
    On July 1, 2017, the Navajo Nation approved an extension lease that 
provides for operation of the NGS through December 2019. This 2 year 
period (2017-2019) provides additional time for the parties to seek new 
owners. If no new owner(s) are identified, the plant will begin 
decommissioning at that time.
    In 2013, NGS stakeholders formulated a Technical Working Group \1\ 
and crafted an agreement containing DOI commitments to develop 
strategies to minimize economic impacts to the Navajo Nation and the 
Hopi Tribe from the closure of the NGS. In accordance with the 
commitments outlined in the NGS Technical Working Group Agreement, 
Reclamation allocated funds \2\ and executed financial assistance 
agreements \3\ to support tribal planning of water and renewable energy 
generation development as part of an economic transition initiative. 
Reclamation's authorities are limited to planning assistance which is 
funded through Central Arizona Project appropriations.
---------------------------------------------------------------------------
    \1\ 2013 NGS Technical Working Group Agreement: Department of 
Interior, Gila River Indian Community, Navajo Nation, Central Arizona 
Water Conservation District, Environmental Defense Fund, Western 
Resource Advocates and Salt River Project Agricultural Improvement and 
Power District.
    \2\ Central Arizona Project--Operation and Maintenance Oversight.
    \3\ National Renewable Energy Laboratory--Interagency Agreement 
$2.7M; Navajo Nation--Cooperative Agreement ($200,000); Hopi Tribe--
Cooperative Agreement ($200,000) and Gila River Indian Community--
Cooperative Agreement ($250,000).
---------------------------------------------------------------------------
    In addition to Reclamation's authority, several other Government 
agencies (e.g., Department of Energy and Bureau of Indian Affairs) have 
authority to work with the tribes to develop strategies for economic 
development into the future. The formulation and support of a 
northeastern Arizona economic transition working group that includes 
Reclamation along with these and other agencies, could focus the 
objectives and tasks, improve communication, and coordinate resources 
needed to support workforce planning and transition.
                           aamodt settlement
    Question. As you know, the Aamodt settlement was the culmination of 
the longest running water dispute in United States history. The 
settlement brought together the City and County of Santa Fe, four 
pueblos, and the State--no small feat. As a result, the pueblos are 
secure in their water rights and the non-pueblos are secure in their 
water supplies. But like many water settlements, the devil is in the 
details. And there is much work to be done to implement this 
settlement.
    Mr. Mikkelsen, you met with my staff recently, and I understand 
that you will be lead on this settlement.
    Can you give me your assurances that you will make full 
implementation of the Aamodt water settlement a priority of yours and 
this Administration?
    Answer. The Administration and Bureau of Reclamation are committed 
to fulfilling all of our Tribal water settlements, including the Aamodt 
Litigation Settlement, within the times specified by the individual 
public laws governing their completion as specified by Congress. All of 
the parties involved in the settlement have been working diligently to 
complete a final design and plan for the Pojoaque Regional Water 
System. The Pojoaque Regional Water System is the portion of the 
overall Aamodt Litigation Settlement for which the Bureau of 
Reclamation is responsible. In fiscal year 2018, this project is 
expected to begin land acquisition and begin construction after 
completing a Record of Decision and final designs.
                          gila river diversion
    Question. Mr. Mikkelsen, in 2004, Congress passed the Arizona Water 
Settlements Act. The Act gave New Mexico $66 million dollars in funds 
and 10 years to decide how to use Federal money to meet water needs in 
four rural counties.
    In 2014, the New Mexico Interstate Stream Commission voted to 
pursue a water diversion at the headwaters of the Gila River--is one of 
the last undammed rivers in the West--rather than focus the money on 
water efficiency for agricultural and municipal users, community water 
systems and restoration projects--projects all allowed under the law.
    Currently, the New Mexico Unit of the Central Arizona Project is 
working with the Bureau of Reclamation to identify a viable diversion 
option. And has until 2019 to complete the planning and design of the 
Gila Diversion. As I understand it, the New Mexico Unit intends to 
submit a series of plans by fall to the Bureau of Reclamation to 
conduct an environmental review, as outlined by the Act.
    There are estimates a diversion dam could cost a billion dollars to 
construct. Something I don't foresee the Federal Government funding.
    Do you agree the Federal Government is unlikely to appropriate this 
level of funding for big new water projects in this fiscal environment?
    Answer. Reclamation does not plan on seeking any Federal 
discretionary appropriations for construction of the New Mexico Unit 
(Unit).
    The 2004 Arizona Water Settlements Act (AWSA) provided $66 million 
(indexed) from the Lower Colorado River Basin Development Fund 
(Development Fund) to be transferred into the State's New Mexico Unit 
Fund for construction of a Unit or for other water utilization 
alternatives in southwest New Mexico. An additional $34 million 
(indexed) from the Development Fund may be available for construction 
of a Unit if a Record of Decision is issued by the Secretary of the 
Interior approving the project based on an environmental analysis. The 
AWSA identified an additional, $28 million (indexed) which could be 
available for construction, depending on earnings in the Development 
Fund, which, based on current earnings is unlikely. To date, six annual 
payments of $9.04 million each have been transferred to the New Mexico 
Unit Fund totaling $54.2 million. The New Mexico Unit Fund is 
administered by New Mexico's Interstate Stream Commission (NMISC).
    If New Mexico and the New Mexico Central Arizona Project Entity 
(Entity), as beneficiaries of the project, choose to pursue a project 
that will cost more than is available under the AWSA, they will need to 
provide any additional funding required for the project.
    In the past, several diversion, conveyance, and off-stream storage 
options were identified. The highest cost options included diversion, 
reservoirs and pumping water to the Deming, N.M. area. In July 2016, 
the Entity submitted their proposed Unit action, a diversion and 
storage project to provide water for agricultural purposes in the 
Cliff-Gila Valley. We understand they are now revising that project, 
striving to limit project construction costs to funding available under 
the AWSA. Reclamation expects to receive an updated project proposal 
later this fall.
    In 2014 and 2015, the NMISC voted to fund other water utilization 
alternatives (non-NM Unit) in southwest New Mexico totaling $9.1 
million. The projects include water conveyance improvements, effluent 
reuse, conservation projects and improvements to an existing diversion 
on the Gila River.
    In addition, one of our duties as public officials is to assure 
that the funds of the American people are spent wisely, with proper 
oversight and transparency.
    Question. Will you commit that you and, if confirmed, Brenda Burman 
the nominee to run the Bureau of Reclamation, will keep an eye out for 
taxpayers as Bureau of Reclamation analyzes the options for this 
project?
    Answer. Yes, in support of our mission to manage, develop, and 
protect water and related resources in an environmentally and 
economically sound manner in the interest of the American public. 
Reclamation will complete the required environmental compliance and 
appropriate technical analyses necessary to provide information to the 
Secretary of the Interior for use in the Record of Decision.
    Question. And, because my staff and I have received incomplete 
information, would you commit to providing us with updates on how much 
money is being spent by the Interstate Stream Commission and New Mexico 
Entity and on what?
    Answer. Funding provided by Reclamation to the New Mexico Unit Fund 
would be from the Lower Colorado Region Basin Development Fund as 
required by the AWSA. This funding would be non-discretionary funding 
as Reclamation must follow the payment schedule provided in the AWSA, 
and is not subject to the annual appropriations process. Once the 
funding is transferred to the Interstate Stream Commission (ISC), 
Reclamation believes we do not have an oversight role in the spending. 
If desired, Reclamation can provide an accounting of payments made to 
the State's New Mexico Unit Fund. The State's New Mexico Unit Fund 
budgets and expenditures are available through the CAP Entity and ISC 
meeting materials as well as an annual report that the ISC submits to 
the legislature for the NM Unit Fund. This report is located at http://
nmawsa.org/library/reports/.

                         CONCLUSION OF HEARINGS

    Senator Hoeven. The written statements of each of our 
witnesses will be included in the record.
    And again, thank you, and we are adjourned.
    [Whereupon, at 4:34 p.m., Wednesday, June 28, the hearings 
were concluded, and the subcommittee was recessed, to reconvene 
subject to the call of the Chair.]