[Federal Register Volume 59, Number 121 (Friday, June 24, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-15197]


[[Page Unknown]]

[Federal Register: June 24, 1994]


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DEPARTMENT OF DEFENSE

Department of the Army

32 CFR Part 241

 

Flood Control Cost-Sharing Requirements Under the Ability to Pay 
Provision

AGENCY: U.S. Army Corps of Engineers, DOD.

ACTION: Proposed Rule.

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SUMMARY: The Department of the army is proposing to amend the 
procedures contained in 32 CFR Part 241 for ability to pay 
determinations for flood control projects. The proposed amendment will 
establish an eligibility for reductions in the non-Federal cost share 
using high cost criteria. A final rule for flood control projects 
implementing Section 103(m) of Public Law 99-662, 33 U.S.C. 2213m, was 
published in the Federal Register on October 2, 1989 (54 FR 40578). 
This proposal will amend these guidelines in accordance with the 
discretionary language in Section 201 of Public Law 102-580. The 
proposed rule modifies the ability to pay determination for flood 
control project to include consideration for projects with a 
combination of high local sponsor cost shares and high local sponsor 
per capita project costs.

DATES: August 23, 1994.

ADDRESSES: HQUSACE, Director of Civil Works, ATTN: CECW-AA, Washington, 
DC 20314-1000.

FOR FURTHER INFORMATION CONTACT: Donald L. Barnes (202) 272-0120.

SUPPLEMENTARY INFORMATION: The proposed amendment will establish an 
eligibility for reductions in the non-Federal cost share using high 
cost criteria. In accordance with direction prescribed by Section 201 
of the Water Resources Development Act of 1992, the Department of the 
Army conducted a study of the current ability to pay regulations for 
flood control projects. This study found, that while non-Federal cost 
shares for most structural flood control projects were less than 35 
percent, in some cases (16 percent of the projects in a sample group 
studied), the non-Federal shares exceeded 35 percent, due to the high 
costs for lands, easements, rights-of-way, relocations, and disposal 
areas (LERRD). In addition, while for a majority of projects, the non-
Federal per capita cost of construction (total non-Federal share of 
construction costs divided by the population included within the 
geographic jurisdiction of the non-Federal project sponsor) was less 
than $300, a significant number (34 percent of the sample studied) had 
per capita non-Federal costs that exceeded that amount. Given these 
circumstances, it is proposed that when the normal non-Federal share is 
high (i.e. exceeding 35 percent) and when the normal per capita non-
Federal cost of construction exceeds $300, adjustments should be made 
to the standard non-Federal share based on ``ability to pay'' 
considerations. Specifically, when both criteria are exceeded, the non-
Federal share under the ability to pay provision will be either LERD's 
(i.e., no cash requirement) or 35 percent, whichever is greater. If 
LERRD's exceed 50 percent, the non-Federal share remains at 50 percent. 
This procedure does not change the benefits and income tests of the 
existing rule. Projects which would qualify for a reduction under the 
existing final rule, will receive a reduction from the high cost 
criteria, only if it provides a greater reduction than the benefits and 
income tests.

E.O. 12866 and Regulatory Flexibility Act

    This rule is not a major rule within the meaning of Executive Order 
12866, because it is not likely to result in: (1) An annual effect on 
the economy of $100 million or more: (2) a major increase in costs or 
prices for consumers, individual industries, Federal, State, or local 
government agencies, or geographic regions: or (3) significant adverse 
effects on competition, employment, investment, productivity, 
innovation, or on the ability of United States based enterprises to 
compete with foreign based enterprises in domestic or export markets.
    Pursuant to 5 U.S.C. Section 605(b) I hereby certify that this rule 
will not have a significant economic impact on a substantial number of 
small entities. Furthermore, the number of entities affected by this 
rule is small, and it imposes few, if any, administrative burdens of 
any sort on small entities.

List of Subjects in 33 CFR 241

    Community facilities, Flood control, Intergovernmental relations, 
Water resources.

    For reasons set out in the preamble, 33 CFR part 241 is proposed to 
be amended as follows:

PART 241 FLOOD CONTROL COST SHARING REQUIREMENTS UNDER THE ABILITY 
TO PAY PROVISION

    1. The authority for part 241 is revised to read as follows:

    Authority: Sec. 103(m), Water Resources Development Act of 1986 
Pub. L. 99-662, 100 Stat. 4082, 33 U.S.C. 2201 et seq., as amended 
by Sec. 201, Water Resources Development Act of 1992 Pub. L. 102-
580, 106 Stat. 4797, U.S.C. 2201 et seq.

    2. Sections 241.1 through 241.3 are revised to read as follows:


Sec. 241.1  Purpose.

    This regulation gives general instructions on the implementation of 
section 103(m) of Public Law 99-662, as amended by section 201 of 
Public Law 102-588, for application to flood control projects.


Sec. 241.2  Applicability.

    This regulation applies to all U.S. Army Corps of Engineers 
Headquarters (HQUSACE) elements and Major Subordinate Commands and 
District Commands of the Corps of Engineers having Civil Works 
responsibilities.


Sec. 241.3  References.

    (a) Water Resources Development Act, 1986, Public Law 99-662, 100 
Stat. 4082 33 U.S.C. 2201 et seq.
    (b) Water Resources Development Act, 1992, Public law 102-580, 106 
Stat. 4797, 33 U.S.C. 2201 et seq.
    (c) U.S. Water Resources Council, Economic and Environmental 
Principles and Guidelines for Water and Related Land Resources 
Implementation Studies, March 10, 1983.
    (d) Office of Personnel Management, FPM Bulletin 591-30.
    (e) Office of Personnel Management, FPM Bulletin 591-32.
    (f) U.S. Army Corps of Engineers, Engineer Regulation 1165-2-29.
    (g) U.S. Army Corps of Engineers, Engineer Regulation 1165-2-121.
    (h) U.S. Army Corps of Engineers, Engineer Regulation 1165-2-131.
    (i) U.S. Army Corps of Engineers, Engineer Regulation 405-1-12.


Sec. 241.5  Procedures for estimating the alternative cost share.

    3. Section 241.5 is amended by adding paragraph (d):
* * * * *
    (d) Additional consideration for high cost projects. For any 
project where the normal non-Federal share exceeds 35 percent, and the 
per capita non-Federal cost (i.e., normal non-Federal share of total 
construction costs divided by the population in the sponsor's 
geographic jurisdiction) exceeds $300, the non-Federal share under the 
ability to pay provision will be either LERRD's (i.e., no cash 
requirement) or 35 percent, whichever is greater. If LERRD's exceed 50 
percent, the non-Federal share remains at 50 percent. Projects which 
qualify under the benefits and income tests will receive the reduction 
under the high cost criteria, if it results in a greater reduction in 
the non-Federal cost share.


Sec. 241.6  [Amended]

    4. In Sec. 241.6(a), the term ``LCA'' is revised to read ``Project 
Cooperation Agreement (PCA).''
    5. All references in Sec. 241.7 to the term ``LCA'' are revised to 
read ``PCA''. In addition this section is amended by revising paragraph 
(c)(2) and the first sentence of paragraph (e)(2), as follows:


Sec. 241.7  Application of test.

* * * * *
    (c) * * *
    (2) An exhibit attached to the PCA will include the Benefits Based 
Floor (BBF) determined in Sec. 241.5(a), the Eligibility Factor (EF) 
determined in Sec. 241.5(b), if the Eligibility Factor is greater than 
zero but less than one, the estimated standard non-Federal share, the 
formula used in determining the ability to pay share as described in 
Sec. 241.5 (c)(1) through (c)(4), and a display of the non-Federal cost 
share under the high cost criteria described in Sec. 241.5(d).
* * * * *
    (e) * * *
    (2) The non-Federal sponsor will be required to provide a cash 
payment equal to the minimum of five percent of estimated project 
costs, regardless of the outcome of the ability to pay test, unless any 
or all of the five percent cash requirement is waived by application of 
the high cost criteria described in Sec. 241.5(d).
* * * * *
    Dated: June 17, 1994.

John A. Mills,
COL, General Staff, Executive Officer, Office of the Assistant 
Secretary of the Army (Civil Works).
[FR Doc. 94-15197 Filed 6-27-94; 8:45 am]
BILLING CODE 3710-92-M