[Congressional Record Volume 151, Number 110 (Wednesday, September 7, 2005)]
[Senate]
[Pages S9719-S9721]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
WATER RESOURCES DEVELOPMENT ACT
Mr. INHOFE. Mr. President, section 403 of the Congressional Budget
and Impoundment Control Act requires that a statement of the cost of
the reported bill, prepared by the Congressional Budget Office, be
included in the report. At the time of filing of the report, the
statement was unavailable. The statement has since been received by the
committee. I ask unanimous consent that the statement be printed in the
Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:
S. 728, Water Resources Development Act of 2005, As reported
by the Senate Committee on Environment and Public Works
on April 26, 2005
Summary
S. 728 would authorize the Army Corps of Engineers (Corps)
to conduct water resource studies and undertake specified
projects and programs for flood control, inland navigation,
shoreline protection, and environmental restoration. The bill
would authorize the agency to conduct studies on water
resource needs, to complete feasibility studies for specified
projects, and to convey ownership of certain Federal
properties. Finally, the bill would extend, terminate, or
modify existing authorizations for various water projects and
would authorize new programs to develop water resources and
protect the environment.
Assuming appropriation of the necessary amounts, including
adjustments for increases in anticipated inflation, CBO
estimates that implementing S. 728 would cost about $4.1
billion over the 2006-2010 period and an additional $7.6
billion over the 10 years after 2010. (Some construction
costs and operations and maintenance would continue or occur
after this period.)
S. 728 would allow the Corps to spend any proceeds that it
collects from grazing fees, shoreline management permit fees,
municipal and industrial water supply fees, recreational
fees, and leases. In addition, the bill would allow the
Federal Government's power marketing administrations (PMAs)
to use proceeds from power sales to fund Corps expenses
related to hydropower. S. 728 also would convey parcels of
land to various nonFederal entities and would forgive the
obligation of some local government agencies to pay certain
project costs. Finally, the bill would allow the Corps to
collect and spend fees collected for training courses and
permit processing. CBO estimates that enacting those
provisions would increase direct spending by $212 million in
2006, $1.1 billion over the 2006-2010 period, and $2.3
billion over the 2006-2015 period. Pursuant to section 407 of
H. Con. Res. 95 (the Concurrent Resolution on the Budget,
Fiscal Year 2006), CBO estimates that enacting S. 728 would
cause an increase in direct spending greater than $5 billion
in the 10-year period beginning in 2046. Enacting the bill
would not affect revenues.
S. 728 contains no intergovernmental or private-sector
mandates as defined in UMRA. Federal participation in water
resources projects and programs authorized by this bill would
benefit State, local, and tribal governments, and any costs
to those governments to comply with the conditions of this
Federal assistance would be incurred voluntarily. The bill
also would benefit those governments by authorizing
additional funds or reducing matching requirements for some
specific projects.
Estimated Cost to the Federal Government
The estimated budgetary impact of S. 728 is shown in the
following table. The costs of this legislation fall within
budget functions 300 (natural resources and the environment)
and 270 (energy).
TABLE 1. ESTIMATED BUDGETARY IMPACT OF S. 728 OVER THE 2006-2010 PERIOD
[By fiscal year, in millions of dollars]
--------------------------------------------------------------------------------------------------------------------------------------------------------
2006 2007 2008 2009 2010
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CHANGES IN SPENDING SUBJECT TO APPROPRIATION
Estimated Authorization Level...................................... 902 864 861 857 884
Estimated Outlays.................................................. 632 866 853 849 867
CHANGES IN DIRECT SPENDING
Estimated Budget Authority......................................... 232 222 224 219 227
Estimated Outlays.................................................. 212 218 223 219 227
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Basis of Estimate
For this estimate, CBO assumes that S. 728 will be enacted
near the beginning of fiscal year 2006 and that the necessary
amounts will be appropriated for each fiscal year.
Spending Subject to Appropriation
S. 728 would authorize new projects related to
environmental restoration, shoreline protection, and
navigation. This bill also would modify many existing Corps
projects and programs by increasing the amounts authorized to
be appropriated to construct or maintain them or by
increasing the Federal share of project costs. Assuming
appropriation of the necessary funds, CEO estimates that
implementing this bill would cost $4.1 billion over the 2006-
2010 period and an additional $7.6 billion over the 10 years
after 2010. For ongoing construction costs of previously
authorized projects, the Corps received a 2005 appropriation
of about $1.8 billion, including funds from the Inland
Waterway Trust Fund.
For new water projects specified in the bill, the Corps
provided CBO with estimates
[[Page S9720]]
of annual budget authority needed to meet design and
construction schedules. CBO adjusted those estimates to
reflect the impact of anticipated inflation during the time
between project authorization and appropriation of
construction costs. Estimated outlays are based on historical
spending rates for Corps projects.
Significant New Authorizations. S. 728 would authorize the
Army Corps of Engineers to conduct water resource studies and
undertake specified projects and programs for flood control,
inland navigation, shoreline protection, and environmental
restoration. For example, the bill includes authorizations
for enhanced navigation improvements on the Upper Mississippi
River at an estimated Federal cost of $1.8 billion and an
ecosystem restoration project, also on the Upper
Mississippi River, at an estimated Federal cost of $1.6
billion. Another large project authorized by this bill is
the Indian River Lagoon project in the Florida Everglades
at an estimated Federal cost of $605 million. Construction
of those projects would likely take more than 15 years.
Deauthorizations. Title VI would withdraw the authority for
the Corps to build 58 projects authorized in previous
legislation. Based on information from the Corps, however,
CBO does not expect that the agency would begin any work
(under current law) for most of those projects over the next
5 years. Some of those projects do not have a local sponsor
to pay nonFederal costs, others do not pass certain tests for
economic viability, and still others do not pass certain
tests for environmental protection. Consequently, CBO
estimates that canceling the authority to build those
projects would provide no significant savings over the next
several years.
Future Corps Appropriations for Operations and Maintenance.
As discussed below under ``Direct Spending,'' sections 2019
and 2020 would make about $175 million a year available for
operations and maintenance at Corps facilities without
further appropriation. In fiscal year 2005, the Corps
received an appropriation of about $2 billion for operations
and maintenance costs, including funds from the Harbor
Maintenance Trust Fund. Enacting this bill could result in a
reduction in future appropriations if the Congress chose to
reduce total Corps spending below the level appropriated in
2005. In lieu of a reduction, however, the Congress could
choose to continue Corps funding at current levels to provide
funds for the backlog of the agency's maintenance needs. For
this estimate, CBO assumes that future Corps appropriations
would continue at current levels and that new spending
authorized by the bill would be in addition to the current
level of agency funding.
Direct Spending
Based on information from affected agencies, CBO estimates
that enacting S. 728 would increase direct spending by about
$212 million in 2006 and $2.3 billion over the 2006-2015
period. Table 2 presents the direct-spending components of
the bill. Most of the direct spending under the bill would
stem from provisions to allow for the spending of existing
power revenues associated with Corps projects for facility
planning, operation, maintenance, and upgrades without
further appropriation. Under current law, those and other
fees that would be made available for spending are deposited
(as setting receipts) to the general fund of the Treasury.
Improvement of Water Management at Corps of Engineers
Reservoirs. Section 2019 would allow the Corps to spend any
proceeds collected from grazing fees, shoreline management
permit fees, and municipal and industrial water supply fees.
Under the bill, the Corps could spend such funds for
operations and maintenance at its facilities. Based on
information from the agency, CBO estimates that spending of
such receipts would total $21 million in 2006 and 88 million
over the 2006-2015 period.
Direct Funding of Corps Operations and Maintenance for
Hydropower. Section 2020 would allow the Federal power
marketing administrations to use proceeds from the sale of
electricity to fund Corps expenses related to hydropower
functions. Based on information from the PMAs, CBO expects
that such direct funding would cost $142 million in 2006
and $1.5 billion over the 2006-2015 period, with
additional costs after 2015. Currently, receipts collected
by the PMAs for the sale of electricity and related
services are deposited in the Treasury. Once such
expenditures are directly funded, annual appropriations
for the Corps could be reduced by a similar amount, or
those funds could be spent on other unfunded Corps
priorities.
The PMAs are required to set electricity rates at a level
that recoups Federal costs. Such costs include expenses
specific to maintaining hydropower facilities at Corps
projects in addition to joint costs or those allocated
between all functions at a project (recreation,
environmental, flood control, etc.). This bill would specify
that only costs allocated exclusively to electricity
production could be funded with sales revenues.
Recreational Areas and Project Sites. Section 2004 would
authorize spending of receipts from leases and fees at Corps
recreational areas for operations and maintenance at
recreation areas and project sites. Based on information from
the Corps, CBO estimates that enacting this section would
cost $41 million in 2006 and $507 million over the 2006-2015
period.
TABLE 2. CHANGES IN DIRECT SPENDING UNDER S. 728
[By fiscal year, in millions of dollars]
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2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
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CHANGES IN DIRECT SPENDING
Improvement of Water Management at Corps Reservoirs:
Estimated Budget Authority................................ 30 30 30 30 30 30 30 30 30 30
Estimated Outlays......................................... 21 27 30 30 30 30 30 30 30 30
Direct Funding of Operations and Maintenance for Hydropower:
Estimated Budget Authority................................ 142 140 142 144 145 148 149 152 154 159
Estimated Outlays......................................... 142 140 142 144 145 148 149 152 154 159
Spending of Lease Receipts:
Estimated Budget Authority................................ 10 10 10 10 10 10 10 10 10 10
Estimated Outlays......................................... 8 10 10 10 10 10 10 10 10 10
Recreation Fees:
Estimated Budget Authority................................ 42 42 42 42 42 42 42 42 42 42
Estimated Outlays......................................... 33 41 41 42 42 42 42 42 42 42
Land Conveyances and Other Direct Spending:
Estimated Budget Authority................................ 8 * * -7 * * * * * *
Estimated Outlays......................................... 8 * * -7 * * * * * *
Total Changes:
Estimated Budget Authority............................ 232 222 224 219 227 230 231 234 236 241
Estimated Outlays..................................... 212 218 223 219 227 230 231 234 236 241
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NOTE: * = less than $500,000.
Spending of Corps Lease Receipts. This section would allow
the Corps to spend money it collects from leases at
recreational areas and project sites without further
appropriation on operations and maintenance. Based on
information from the Corps, CBO estimates that enacting this
section would cost $8 million in 2006 and $98 million over
the 2006-2015 period.
Spending of Recreation Fees. This section would direct the
Corps to establish a new system of recreation fees, including
charges for admission to Corps recreation sites and for the
use of recreation facilities, visitor centers, equipment,
and services. Under the bill, the new fees (which would be
based on the value of the admission or service purchased)
would replace charges authorized under more restrictive,
existing laws. CBO estimates that, once the broader fee
authority that would be provided by this section has been
fully implemented, Corps offsetting receipts would
increase by $12 million a year from the current annual
level of about $42 million. (We expect that increases
would initially be less because of delays in determining
the market value of similar local recreation opportunities
and establishing appropriate fee schedules for some
recreation sites.) Because all amounts collected under the
fee system would be available to the Corps without further
appropriation, however, CBO estimates that enacting this
provision would have a net cost of $33 million in 2006 and
nearly $200 million over the 2006-2010 period. Over the
2006-2015, the total increase in net direct spending would
be just over $400 million.
Various Land Conveyances. S. 728 would authorize the Corps
to convey at fair market value 13 acres of land and the
structures on the land, including a loading dock with mooring
facilities, in Alabama. In addition, S. 728 would authorize
the conveyance at fair market value 650 acres of Federal land
at the Richard B. Russell Lake in South Carolina to the
State. Based on information from the Corps, CBO estimates
that the Federal Government would receive about $7 million in
2008 from those sales.
The bill also would convey certain Federal land in Alabama,
Pennsylvania, Georgia, Oregon, Kansas, and Missouri. CBO
estimates that those conveyances would have no significant
impact on the Federal budget.
Arcadia Lake, Oklahoma. Section 3071 would eliminate the
obligation of the city of Edmond, Oklahoma, to pay
outstanding interest due on its water storage contract with
the Corps. CBO estimates that this provision would result in
a loss of receipts of about $8 million in 2006.
Waurika Lake Project. Section 3073 would eliminate the
obligation of the Waurika Project Master Conservancy District
in
[[Page S9721]]
Oklahoma to pay its outstanding debt related to the
construction of a water conveyance project. Because of an
accounting error, the Corps inadvertently undercharged the
district for costs associated with a land purchase related to
the water project in the early 1980's. Under terms of the
construction contract, the district is required to pay all
costs associated with building the project, including the
full cost of the land purchases. CBO estimates that enacting
this section would cost less than $200,000 a year over the
2006-2015 period.
Funding to Process Permits. Section 2017 would make
permanent the Corps' current authority to accept and spend
funds contributed by private firms to expedite the evaluation
of permit applications submitted to the Corps. CBO estimates
that the Corps would accept and spend less than $500,000
during each year of this extension and that the net budgetary
impact of this provision would be negligible.
Training Funds. Section 2003 would allow the Corps to
collect and spend fees collected from the private sector for
training courses. CBO estimates that the Corps would accept
and spend less than $500,000 annually and that the net
budgetary impact would be negligible.
Estimated Long-Term Direct Spending Effects
Pursuant to section 407 of H. Con. Res. 95 (the Concurrent
Resolution on the Budget, Fiscal Year 2006), CBO estimates
that enacting S. 728 would cause an increase in direct
spending greater than $5 billion in the 10-year period
beginning in 2046. That estimate assumes that the bill's
estimated direct spending cost of $241 million in 2015 would
continue to increase over the next 40 years. Specifically,
CBO assumes that the Corps' costs for operations and
maintenance at PMA projects would increase at the rate of
inflation projected for 2015 for this activity about 2.9
percent a year. That inflator reflects a weighted average of
pay and nonpay components of Corps operations and maintenance
activities. In addition, we assume that Corps collections
from grazing, permit, water-use fees, and proceeds from the
use of recreationsites would increase more slowly, near the
observed historical rates of growth for such collections.
Intergovernmental and Private-Sector Impact
S. 728 contains no intergovernmental or private-sector
mandates as defined in UMRA. Federal participation in water
resources projects and programs authorized by this bill would
benefit State, local, and tribal governments, and any costs
to those governments to comply with the conditions of this
Federal assistance would be incurred voluntarily. The bill
also would benefit those governments by authorizing
additional funds or reducing matching requirements for some
specific projects.
Estimate Prepared By: Federal Costs: Julie Middleton, Lisa
Cash Driskill, Deborah Reis, and Mike Waters; Impact on
State, Local, and Tribal Governments: Marjorie Miller; Impact
on the Private Sector: Selena Caldera.
Estimate Approved By: Peter H. Fontaine, Deputy Assistant
Director for Budget Analysis.
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