Indian Irrigation Projects: Numerous Issues Need to Be Addressed 
to Improve Project Management and Financial Sustainability	 
(24-FEB-06, GAO-06-314).					 
                                                                 
The Department of the Interior's Bureau of Indian Affairs (BIA)  
manages 16 irrigation projects on Indian reservations in the	 
western United States. These projects, which were generally	 
constructed in the late 1800s and early 1900s, include water	 
storage facilities and delivery structures for agricultural	 
purposes. Serious concerns have arisen about their maintenance	 
and management. GAO was asked to examine (1) BIA's estimated	 
deferred maintenance cost for its 16 irrigation projects, (2)	 
what shortcomings, if any, exist in BIA's current management of  
its irrigation projects, and (3) any issues that need to be	 
addressed to determine the long-term direction of BIA's 	 
irrigation program.						 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-06-314 					        
    ACCNO:   A47799						        
  TITLE:     Indian Irrigation Projects: Numerous Issues Need to Be   
Addressed to Improve Project Management and Financial		 
Sustainability							 
     DATE:   02/24/2006 
  SUBJECT:   Cost analysis					 
	     Financial analysis 				 
	     Indian lands					 
	     Internal controls					 
	     Maintenance costs					 
	     Program evaluation 				 
	     Program management 				 
	     Water supply management				 
	     Cost estimates					 
	     Irrigation 					 

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GAO-06-314

     

     * Report to the Chairman, Subcommittee on Interior and Related Agencies,
       Committee on Appropriations, U.S. Senate
          * February 2006
     * INDIAN IRRIGATION PROJECTS
          * Numerous Issues Need to Be Addressed to Improve Project
            Management and Financial Sustainability
     * Contents
          * Results in Brief
          * Background
          * BIA Estimates the Cost of Deferred Maintenance at about $850
            Million, but the Estimate Is Being Refined
               * In 2004, BIA Initially Estimated Completing the Deferred
                 Maintenance Would Cost Over $1 Billion
               * In 2005, BIA Revised the Estimate Downward to about $850
                 Million, but It Is Still a Work in Progress
          * Shortcomings in BIA's Management of Some Irrigation Projects
            Undermine Effective Decisionmaking
               * In Many Cases, BIA Officials with Oversight Authority Lack
                 Expertise, While Those with Expertise Lack Authority
               * BIA Has Not Consistently Provided Information and
                 Opportunities for Stakeholders to Participate in Setting
                 Project Priorities
          * Long-Term Direction of BIA's Irrigation Program Depends on
            Resolution of a Number of Larger Issues
               * The Extent to Which Projects Are Capable of Sustaining
                 Themselves Is Unknown
               * There Is No Plan for How to Fund the Deferred Maintenance
               * It Might Be More Appropriate for Other Entities to Manage
                 Some or All of the Projects
          * Conclusions
          * Recommendations for Executive Action
          * Agency Comments and Our Evaluation
     * Objectives, Scope, and Methodology
     * Profiles of the Nine Irrigation Projects GAO Visited
          * Blackfeet Irrigation Project
               * Key Operations and Maintenance Concerns Expressed During Our
                 Site Visit
               * Key Management Concerns Expressed During Our Site Visit
          * Colorado River Irrigation Project
               * Key Operations and Maintenance Concerns Expressed During Our
                 Site Visit
               * Key Management Concerns Expressed During Our Site Visit
          * Crow Irrigation Project
               * Key Operations and Maintenance Concerns Expressed During Our
                 Site Visit
               * Key Management Concerns Expressed During Our Site Visit
          * Fort Belknap Irrigation Project
               * Key Operations and Maintenance Concerns Expressed During Our
                 Site Visit
               * Key Management Concerns Expressed During Our Site Visit
          * Pine River Irrigation Project
               * Key Operations and Maintenance Concerns Expressed During Our
                 Site Visit
               * Key Management Concerns Expressed During Our Site Visit
          * San Carlos Indian Works Irrigation Project (Pima)
               * Key Operations and Maintenance Concerns Expressed During Our
                 Site Visit
               * Key Management Concerns Expressed During Our Site Visit
          * San Carlos Joint Works Irrigation Project (Coolidge)
               * Key Operations and Maintenance Concerns Expressed During Our
                 Site Visit
               * Key Management Concerns Expressed During Our Site Visit
          * Wapato Irrigation Project
               * Key Operations and Maintenance Concerns Expressed During Our
                 Site Visit
               * Key Management Concerns Expressed During Our Site Visit
          * Wind River Irrigation Project
               * Key Operations and Maintenance Concerns Expressed During Our
                 Site Visit
               * Key Management Concerns Expressed During Our Site Visit
     * GAO Contact and Staff Acknowledgments
     * PDF6-Ordering Information.pdf
          * Order by Mail or Phone

Report to the Chairman, Subcommittee on Interior and Related Agencies,
Committee on Appropriations, U.S. Senate

February 2006

INDIAN IRRIGATION PROJECTS

Numerous Issues Need to Be Addressed to Improve Project Management and
Financial Sustainability

Contents

Tables

Figures

February 24, 2006Letter

The Honorable Conrad Burns Chairman Subcommittee on Interior and Related
Agencies Committee on Appropriations United States Senate

The scarcity of water in the western part of the United States makes
irrigation critical to the continued success of agricultural activities.
There are over 100 irrigation works on Indian reservations primarily
across the western United States. The Department of the Interior's Bureau
of Indian Affairs (BIA), which is responsible for providing social and
economic services to Indians, as well as managing land and natural
resources held in trust by the United States for Indians, currently refers
to these irrigation works as either "irrigation projects" or "irrigation
systems." There are 16 irrigation projects where water users are charged
for the operation and maintenance of the irrigation works by BIA. The
remaining systems, on which BIA does not charge an annual operation and
maintenance fee, are operated and maintained through a collaborative
effort which generally involves other BIA programs, tribes, and water
users.

The 16 irrigation projects, which were generally initiated in the late
1800s and early 1900s by the Department of the Interior, include water
storage facilities and delivery structures for agricultural purposes. The
projects were constructed as part of the federal government's Indian
assimilation policy to foster agricultural opportunities and provide
economic benefits to Indian communities. Over time, non-Indians began
buying or leasing the land served by the projects for agricultural
purposes, and project stakeholders evolved from Indian water users and the
tribes within the reservations to include non-Indian water users as well.
Many of the water users today are non-Indian.

A number of prior reports on BIA's irrigation projects have documented
that the annual operations and maintenance fees have historically been set
too low to cover the full cost of running the projects.1 In addition,
problems have been reported with collecting the fees that have been
assessed. Because of insufficient funding, project maintenance has been
consistently postponed, resulting in an extensive and costly list of
deferred maintenance items. The kinds of such deferred maintenance range
from repairing or replacing dilapidated irrigation structures to clearing
weeds from irrigation ditches. In addition to the deferred maintenance,
water users have expressed concern that BIA has been unresponsive in
addressing the projects' ongoing operations and maintenance needs.

The 16 irrigation projects are located in 4 of BIA's 12 regions-Rocky
Mountain, Northwest, Southwest, and Western. Management of these projects
is decentralized, with local or regional BIA offices responsible for
project management. Fourteen projects are overseen by local BIA agency
superintendents, and the 2 largest projects are overseen directly by
regional directors. The agency superintendents that oversee projects
report to their respective regional director. BIA's irrigation and
engineering experts, who provide technical assistance to the projects, are
located in each region as well as in the BIA central Irrigation, Power,
and Safety of Dams offices (central irrigation offices) located in
Washington, D.C., and other BIA locations in the western United States.
The regional irrigation staff and central irrigation office staff do not
have line authority over the projects.

Federal regulations specify that in making judgments about the work and
actions necessary for the proper operation, maintenance and administration
of the projects, the official in charge "... consults with water users and
their representatives, and with tribal council representatives, and seeks
advice on matters of program priorities and operational policies."2
Furthermore, the regulations state that "close cooperation between the
Indian tribal councils, the project waters users and the Officer-In-Charge
[of the project] is necessary and will be to the advantage of the entire
project."3 BIA's irrigation manual and handbook also contain language
directing project staff to involve project stakeholders in the management
of the projects.

In response to ongoing concerns about maintenance and management of the
irrigation projects, in December 2003 Senator Conrad Burns and Congressman
Dennis Rehberg, both of Montana, sponsored a town hall meeting with local
water users and BIA officials to discuss problems at BIA's irrigation
projects. In this context, we were asked to examine (1) BIA's estimated
deferred maintenance cost for its 16 irrigation projects; (2) what
shortcomings, if any, exist in BIA's current management of its irrigation
projects; and (3) any issues that need to be addressed to determine the
long-term direction of BIA's irrigation program.

To address the objectives of this report, we collected documentation on
BIA's 16 irrigation projects from officials in BIA's central irrigation
office, and we visited and collected information from each of BIA's four
regional offices that oversee the 16 irrigation projects. We also visited
9 of the 16 projects, where we collected project-specific information from
BIA officials and project stakeholders. We also met with and collected
documentation from the Department of the Interior's Bureau of Reclamation,
the primary agency responsible for irrigation management, for comparative
purposes. Specifically, to examine estimated deferred maintenance costs,
we reviewed BIA's lists of deferred maintenance items and cost estimates,
and the methodology BIA used to develop these lists and estimates. We
concluded that these data were sufficiently reliable for the purposes of
this report based on a review of relevant controls, reliability tests, and
interviews with agency officials about the collection and management of
the data. We did not develop our own estimate of deferred maintenance. To
determine what, if any, management shortcomings exist, we reviewed
relevant federal regulations and agency guidance, and analyzed BIA-wide
and project-specific management protocols and systems for the 9 projects
we visited. Finally, to determine any issues needing to be addressed to
determine the long-term direction of the projects, we reviewed prior
studies on BIA's irrigation program and we discussed the long-term
direction of the program with BIA irrigation officials and project
stakeholders. A more detailed description of our objectives, scope and
methodology can be found in appendix I. We performed our work between
March 2005 and February 2006 in accordance with generally accepted
government auditing standards.

Results in Brief

BIA has estimated the cost for deferred maintenance at its 16 irrigation
projects at about $850 million for 2005, although the agency is in the
midst of refining this estimate. BIA defines deferred maintenance as
upkeep, such as removing weeds from irrigation ditches or repairing
irrigation structures, that is postponed until some future time. As part
of its ongoing strategy to develop a cost figure for the projects' total
deferred maintenance, BIA had initially estimated this cost at
approximately $1.2 billion in fiscal year 2004. This estimate was based,
in part, on preliminary condition assessments of structures and equipment
at each of the 16 irrigation projects using a scale of good, fair, poor,
critical, and abandoned. The assessment of the structures consisted of
visual inspections generally conducted by nonengineers. BIA acknowledged
that the 2004 estimate would need revision largely for three reasons: the
individuals who conducted the assessments did not have irrigation or
engineering expertise, not all projects used the same methodology to
develop their deferred maintenance estimates, and some projects
incorrectly counted new construction items as deferred maintenance. To
improve its estimate in 2005, BIA implemented a facilities management
system designed to help projects track and continuously update deferred
maintenance information. BIA technical experts from the central irrigation
office conducted training for BIA irrigation projects on how to use this
system, as well as how to correctly define deferred maintenance. Projects
used this system to revise their list of deferred maintenance items and
associated cost estimates in fiscal year 2005, resulting in a lower total
deferred maintenance estimate of about $850 million. However, some
projects continued to classify items as deferred maintenance when they
were actually new construction, and some provided BIA with incomplete
information. To further refine the cost estimate, BIA plans to hire
experts in engineering and irrigation to conduct thorough condition
assessments of all 16 irrigation projects every 5 years to identify
deferred maintenance needs and costs. The first such assessment was
completed in July 2005, with all 16 assessments expected to be completed
by 2010.

BIA's management of some of its irrigation projects has serious
shortcomings that undermine effective decisionmaking about project
operations and maintenance. First, under BIA's organizational structure,
in many cases, officials with the authority to oversee project managers'
decisionmaking lack the technical expertise needed to do so effectively,
while the staff who do have the expertise lack the necessary authority.
The BIA regional directors, agency superintendents and deputy
superintendents that oversee the projects do not generally have
engineering or irrigation expertise and they rely heavily on the project
managers to run the projects. However, this process breaks down when the
project managers themselves do not have the expertise required for the
position-that is, in cases in which BIA has had difficulty filling project
manager vacancies and has, as a result, hired less qualified people. For
example, at the Crow project in 2002, a project manager with insufficient
expertise decided to repair a minor leak in a key water delivery structure
by dismantling it and replacing it with a different type of structure. The
new structure was subsequently deemed inadequate by BIA's irrigation
experts, and the required reconstruction delayed water delivery by about a
month. Furthermore, the BIA staff with such expertise-regional irrigation
engineers and central irrigation office staff-have no authority over the
16 projects. A second serious management shortcoming involves the extent
to which some projects involve stakeholders in decisionmaking. Despite
federal regulations that require BIA to consult with project stakeholders
in setting project priorities, BIA has not consistently provided the
information or opportunities necessary for stakeholders-both Indian and
non-Indian water users-to participate in decisionmaking about project
operations and maintenance. For example, the Wapato Irrigation Project
shares little information on its spending with stakeholders, and the Pine
River Irrigation Project does not meet with its non-tribal stakeholders,
limiting stakeholders' ability to have an impact on project decisions and
BIA's ability to benefit from this input.

The long-term direction of BIA's irrigation program depends on the
resolution of several larger issues. Of most importance, BIA does not know
to what extent its irrigation projects are capable of financially
sustaining themselves, which hinders its ability to address long-standing
concerns regarding inadequate funding. The projects were constructed
without consideration for whether they could generate adequate income to
be self-supporting, yet since the 1960s many have been considered
generally self-supporting through fees paid by water users. The future of
BIA's irrigation program also depends on the resolution of how the
deferred maintenance will be funded. BIA currently has no plan for how it
will obtain funding to fix the deferred maintenance items. Regardless of
the precise cost estimate for total deferred maintenance, funding deferred
maintenance costs in the hundreds of millions of dollars will be a
significant challenge in times of tight budgets and competing priorities.
In the interim, the Congress has appropriated approximately $7.5 million
for some of BIA's irrigation projects for fiscal year 2006. Finally, it
might be more appropriate for other entities, including other federal
agencies, tribes, and water users, to manage some or all of the projects.
Given that BIA must balance irrigation management with its many other
missions in support of Indian communities, such as providing education and
law enforcement, it may be beneficial to consider whether others for whom
irrigation is more of a priority or an area of expertise could better
manage some of the projects. Successful management of the projects by
other groups, however, would depend on the characteristics of each project
and its stakeholders. For example, turning over projects to tribes may be
better suited to projects where most of the water users are Indian,
whereas turning over projects to water users would be better suited to
projects where water users share similar interests and have a desire to
organize into an irrigation district or association.

To improve the ongoing day-to-day management of the projects in the
short-term, we are recommending that the Secretary of the Interior direct
the Assistant Secretary for Indian Affairs to provide the necessary level
of technical support for project managers who have less than the desired
level of engineering qualifications and to adequately involve project
stakeholders in the management of the projects. To address the long-term
financial sustainability of the projects, we are recommending that the
Secretary direct the Assistant Secretary for Indian Affairs to conduct
studies to determine the extent to which projects are capable of
sustaining themselves. Information on financial sustainability, along with
accurate deferred maintenance information, are two critical pieces of
information that are needed to have a debate on the long-term direction of
BIA's irrigation program. Once this information is available, the Congress
and interested parties will be able to address how the deferred
maintenance will be funded and whether entities other than BIA could more
appropriately manage some or all of the projects. Since how to fund the
deferred maintenance and who should manage the projects are future policy
issues for the Congress to decide in collaboration with all interested
parties, we are not making any specific recommendations to address them.
Although we requested comments from the Department of the Interior on our
findings and recommendations, none were provided in time to be included as
part of this report.

Background

BIA's irrigation program was initiated in the late 1800s, as part of the
federal government's Indian assimilation policy, and it was originally
designed to provide economic development opportunities for Indians through
agriculture. The Act of July 4, 1884, provided the Secretary of the
Interior $50,000 for the general development of irrigation on Indian
lands.4 Over the years, the Congress continued to pass additional
legislation authorizing and funding irrigation facilities on Indian lands.

BIA's irrigation program includes over 100 "irrigation systems" and
"irrigation projects" that irrigate approximately 1 million acres
primarily across the West. BIA's irrigation systems are non
revenue-generating facilities that are primarily used for subsistence
gardening and they are operated and maintained through a collaborative
effort which generally involves other BIA programs, tribes, and water
users. In contrast, BIA's 16 irrigation projects charge their water users
an annual operations and maintenance fee to fund the cost of operating and
maintaining the project.5 Most of BIA's irrigation projects are considered
self-supporting through these operations and maintenance fees. The 16
irrigation projects are located on Indian reservations across the agency's
Rocky Mountain, Northwest, Southwest, and Western regions (see fig. 1).

Figure 1: Location of BIA's 16 Irrigation Projects by Region

BIA's management of the 16 irrigation projects is decentralized, with
regional and local BIA offices responsible for day-to-day operations and
maintenance. Table 1 provides the tribe or tribes served by each of the 16
irrigation projects along with the year each project was originally
authorized.

Table 1: Tribe(s) Served and Year Authorized for BIA's 16 Irrigation
Projects

                                        

Irrigation project             Tribe(s) served             Year authorized 
Blackfeet          Blackfeet Tribe of the Blackfeet Indian            1907 
                      Reservation of Montana                  
Colorado River     Colorado River Indian Tribes of the                1867 
                      Colorado River Indian Reservation,      
                      Arizona and California                  
Crow               Crow Tribe of Montana                              1890 
Duck Valley        Shoshone-Paiute Tribes of the Duck                    a 
                      Valley Reservation, Nevada              
Flathead           Confederated Salish & Kootenai Tribes              1904 
                      of the Flathead Reservation, Montana    
Fort Belknap       Fort Belknap Indian Community of the               1895 
                      Fort Belknap Reservation of Montana     
Fort Hall          Shoshone-Bannock Tribes of the Fort                1894 
                      Hall Reservation of Idaho               
Fort Peck          Assiniboine and Sioux Tribes of the                1908 
                      Fort Peck Indian Reservation, Montana   
Fort Yumab         Quechan Tribe of the Fort Yuma Indian              1904 
                      Reservation, California & Arizona       
Pine River         Southern Ute Indian Tribe of the                      a 
                      Southern Ute Reservation, Colorado      
San Carlos Indian  Gila River Indian Community of the Gila            1924 
Works              River Indian Reservation, Arizona       
San Carlos Joint   Gila River Indian Community of the Gila            1924 
Works              River Indian Reservation, Arizona       
Uintah             Ute Indian Tribe of the Uintah & Ouray             1906 
                      Reservation, Utah                       
Walker River       Walker River Paiute Tribe of the Walker               a 
                      River Reservation, Nevada               
Wapato             Confederated Tribes and Bands of the               1904 
                      Yakama Nation, Washington               
Wind River         Arapahoe Tribe of the Wind River                   1905 
                      Reservation, Wyoming and the Shoshone   
                      Tribe of the Wind River Reservation,    
                      Wyoming                                 

Source: GAO.

aNo specific authorization date.

bThe Fort Yuma Irrigation Project is operated and maintained by the Bureau
of Reclamation. The operations and maintenance fees collected by BIA for
the project are turned over to the Bureau of Reclamation.

The irrigation facilities constructed by BIA included a range of
structures for storing and delivering water for agricultural purposes.
Figure 2 highlights an example of the key structural features found on
BIA's irrigation projects.

Figure 2: Example of an Irrigation Project Operated by BIA

The beneficiaries of BIA's projects have evolved over time and at present
are quite diverse. Over the years, non-Indians have bought or leased a
significant portion of the land served by BIA's irrigation program. As a
result, current water users on BIA's projects include the tribes,
individual Indian landowners, non-Indian landowners, and non-Indian
lessees of Indian lands. The extent of non-Indian landownership and
leasing ranges significantly across BIA's irrigation projects (see table
2). For example, 100 percent of the land served by the Colorado River
Irrigation Project is Indian owned, while only about 10 percent of the
land served by the Flathead Irrigation Project is Indian owned.

Table 2: Land Ownership for BIA's 16 Irrigation Projects

                                        

Irrigation project Total assessed     Percentage of          Percentage of 
                             acreage Indian owned land  non-Indian owned land 
Colorado River             79,350               100                      0 
Duck Valley                12,923               100                      0 
Fort Yumaa                  7,524               100                      0 
San Carlos Indian         50,000b                99                      1 
Works                                               
Fort Belknap                9,900                92                      8 
Walker River                2,100                90                     10 
Pine River                 11,855                85                     15 
Fort Hall                  72,201                80                     20 
Wind River                 38,300                67                     33 
Blackfeet                  38,300                60                     40 
Wapato                     96,443                60                     40 
Crow                       38,900                56                     44 
Fort Peck                  18,800                53                     47 
Uintah                     62,200                52                     48 
San Carlos Joint         100,000b                50                     50 
Works                                               
Flathead                  128,105                10                     90 
Total                    716,901b                57                     43 

Source: GAO analysis of BIA data.

aThe Fort Yuma Irrigation Project is operated and maintained by the Bureau
of Reclamation. The operations and maintenance fees collected by BIA for
the project are turned over to the Bureau of Reclamation.

bThe acreage for the San Carlos Indian Works is also included in the
acreage for the San Carlos Joint Works. In calculating the total acreage,
the acreage for the San Carlos Indian Works is only counted once.

Federal regulations and internal BIA guidance require that BIA collaborate
with water users, both Indian and non-Indian, in managing the irrigation
projects. For example, federal regulations state that close cooperation
between BIA and water users is necessary and that the BIA official in
charge of each project is responsible for consulting with all water users
in setting program priorities.6 In addition, BIA's manual requires that
BIA "provide opportunities for water user participation in matters
relating to irrigation project operations" and that BIA's
officer-in-charge "meet regularly with water users to discuss proposed
[operation and maintenance] assessment rates ... [and] general operations
and maintenance." Although BIA guidance does not define "regularly," BIA's
Irrigation Handbook explicitly recommends that project staff meet at least
twice annually to discuss work performed over the course of the year and
allow for water user feedback and suggestions for the coming year.
Furthermore, BIA's Irrigation Handbook states that, at a minimum, BIA
should discuss annual project budgets and work plans with water users.

Since their inception, BIA's 16 irrigation projects have been plagued by
maintenance concerns. Construction of the projects was never fully
completed, resulting in structural deficiencies that have continually
hindered project operations and efficiency. In addition, water users and
BIA have reported that operations and maintenance fees provide
insufficient funding for project operations. Due to insufficient funding,
project maintenance has been consistently postponed, resulting in an
extensive and costly list of deferred maintenance items. Such deferred
maintenance ranges from repairing or replacing dilapidated irrigation
structures to clearing weeds from irrigation ditches.

In addition, concerns regarding BIA's management of the projects have been
raised for years, particularly in regard to its financial management
practices. For example, problems concerning BIA's billing practices for
its operations and maintenance fees have been raised by many, prompting
independent review on more than one occasion. We and the Department of the
Interior's Inspector General have both identified serious problems with
the land use records BIA has used to develop its annual operations and
maintenance bills.7 In response, BIA instituted a new financial management
system called the National Irrigation Information Management System, which
has begun to address some of the billing errors. However, concerns still
exist regarding the accuracy of the data in the billing system. The
accuracy of some of the information in the irrigation billing system is
dependant on the irrigation program receiving accurate and timely
information from other BIA programs, such as land ownership and leasing
information from BIA's Real Estate Services program.

In 2001, the Yakama tribe and individual tribal members filed appeals
challenging the Wapato Irrigation Project's operation and maintenance fees
for the pre-2000 and year 2000 bills. Furthermore, the Wapato Irrigation
Project agreed to not send any bills to the tribe or its members since
2001. Although a settlement is under discussion, in the interim the Wapato
Irrigation Project has not been able to collect about $2 million,
annually, of its expected revenue.

BIA Estimates the Cost of Deferred Maintenance at about $850 Million, but
the Estimate Is Being Refined

According to BIA's latest estimate, it will cost about $850 million to
complete the deferred maintenance on all of its 16 irrigation projects;
but this estimate is still being refined. BIA initially estimated its
deferred maintenance costs at over $1 billion in fiscal year 2004, but
acknowledged that this estimate was preliminary and would need to be
revised largely because it incorrectly included new construction items and
was developed by non-engineers. BIA revised this estimate downward in
fiscal year 2005 based on the implementation of a new facilities
management system. However, BIA plans to further refine this estimate
since some projects continued to incorrectly count new construction items
as deferred maintenance.

In 2004, BIA Initially Estimated Completing the Deferred Maintenance Would
Cost Over $1 Billion

As part of its ongoing effort to identify the needs and costs of deferred
maintenance on its 16 irrigation projects, BIA estimated in fiscal year
2004 that it would cost approximately $1.2 billion to complete all
deferred maintenance. This initial estimate was based, in part, on
preliminary condition assessments of irrigation structures and equipment
for each of BIA's 16 irrigation projects. These preliminary condition
assessments generally consisted of visual inspections to classify each
project's structure and equipment using a scale of good, fair, poor,
critical and abandoned based on the apparent level of disrepair. BIA staff
then estimated how much it would cost to repair each item based on its
condition classification.

BIA generally defines deferred maintenance as upkeep that is postponed
until some future time.8 Deferred maintenance varies from project to
project and ranges from cleaning weeds and trees which divert water from
irrigation ditches, to repairing leaky or crumbling check gates designed
to regulate water flow, to resloping eroded canal banks to optimize water
flow. Figure 3 shows examples of deferred maintenance on some of the
irrigation projects we visited (clockwise from the upper left, figure 3
shows (1) a defunct check gate and overgrown irrigation ditch at the Fort
Belknap Irrigation Project, (2) a cattle-crossing eroding a canal bank and
impairing water flow at the Wind River Irrigation Project, (3) a crumbling
irrigation structure at the Crow Irrigation Project, and (4) a check gate
leaking water at the Colorado River Irrigation Project). For detailed
information on key maintenance issues for each of the nine projects we
visited, see appendix II.

Figure 3: Examples of Deferred Maintenance on BIA's Irrigation Projects
(c. 2005)

BIA officials acknowledged that their fiscal year 2004 deferred
maintenance estimate was only a starting point and that it needed to be
revised for three key reasons: (1) the individuals who conducted the
assessments were not knowledgeable about irrigation projects or
infrastructure; (2) not all projects used the same methodology to develop
their deferred maintenance cost estimates; and (3) some projects
incorrectly counted new construction items as deferred maintenance.

o BIA's preliminary condition assessments were conducted by computer
specialists, rather than by people with the expertise in irrigation or
engineering needed to accurately assess project infrastructure. BIA
contracted with geographic information system experts primarily to
catalogue the structures on each project. These geographic information
system experts also observed the condition of the structures they
catalogued and classified the condition of each structure, based on the
level of apparent disrepair, as part of the overall effort to inventory
and map key structures on each project. Consequently, some items
identified as being in "poor" condition may in fact be structurally sound
but simply appear cosmetically dilapidated, whereas other structures
classified as being in "good" condition may in fact be structurally
dilapidated but appear cosmetically sound. For example, according to BIA
staff at the Colorado River Irrigation Project, the recent repainting of
certain check gates disguised severe rust and structural deterioration of
key metal parts.

o BIA staff used inconsistent methodologies to develop the cost estimates
for deferred maintenance. According to BIA staff, the deferred maintenance
cost estimates were developed by different people, sometimes using
different or unknown methodologies for assigning cost values to deferred
maintenance items. For example, some projects developed their own cost
estimates and sent them to BIA's central office for inclusion in its
overall figures, while BIA regional staff developed cost estimates for
other projects based, in part, on information from BIA's preliminary
condition assessments.

o Some projects incorrectly included new construction items as deferred
maintenance. According to BIA, work that would expand a project or its
facilities should not be categorized as deferred maintenance. Therefore,
expanding an existing water delivery system or constructing a new building
is not deferred maintenance. However, some projects incorrectly counted
new construction items as deferred maintenance. For example, the Fort Hall
Irrigation Project included increasing the capacity of its main canal for
about $15.3 million, the Duck Valley Irrigation Project included building
new canals for about $1.3 million, and the Flathead Irrigation Project
included building a new warehouse for about $147,000.

In 2005, BIA Revised the Estimate Downward to about $850 Million, but It
Is Still a Work in Progress

To improve the accuracy of its deferred maintenance estimate in 2005 and
to help staff develop, track, and continuously update deferred maintenance
lists and cost estimates, BIA implemented MAXIMO-a facilities management
system linked to the geographic information system mapping inventory
developed from its preliminary condition assessments.9 Using data from
MAXIMO, BIA revised its total deferred maintenance estimate for the
irrigation projects downward to about $850 million for fiscal year 2005.
Figure 4 shows the current deferred maintenance cost estimate for each of
the 16 projects. In the summer of 2005, BIA technical experts from the
central irrigation office conducted training for BIA irrigation projects
on how to use MAXIMO to enter information on maintenance needs, and how to
correctly define deferred maintenance. Projects used this system to revise
their list of deferred maintenance items and associated cost estimates in
fiscal year 2005. While MAXIMO is still being tailored to the needs of the
irrigation program, its implementation generally standardized the process
for identifying and calculating deferred maintenance among projects.

Figure 4: Fiscal Year 2005 Cost Estimate of Deferred Maintenance by
Irrigation Project

Despite the implementation of MAXIMO, BIA's fiscal year 2005 estimate of
deferred maintenance is still inaccurate for the following reasons:

o Some projects continued to incorrectly count certain items as deferred
maintenance. Despite training, some projects continued to incorrectly
count certain items, such as new construction items and vehicles, as
deferred maintenance. For example, the Fort Hall Irrigation Project
included the installation of permanent diversion structures for about $2.1
million, the Wapato Irrigation Project included constructing reservoirs
for about $640,000, and the San Carlos Indian Works Irrigation Project
included building a new office for about $286,000. In addition, some
projects included the cost of repairing vehicles or buying new ones in
their deferred maintenance estimates, despite BIA's new guidance that such
items are not deferred maintenance. According to BIA officials, while
projects can consider the weed clearing postponed due to broken vehicles
as deferred maintenance, the delayed repair of the vehicle itself is not
deferred maintenance. For example, the Wind River Irrigation Project
included an excavator vehicle for about $500,000 and the Crow Irrigation
Project included dump trucks for about $430,000.

o Some projects provided BIA with incomplete information. According to BIA
officials, some projects did not do thorough assessments of their deferred
maintenance needs, and some may not be including legitimate deferred
maintenance items, such as re-sloping canal banks that have eroded by
crossing cattle or overgrown vegetation. Moreover, both the Walker River
and the Uintah Irrigation Projects failed to provide information detailing
their deferred maintenance costs, and several projects lumped items
together as "other" with little or no explanatory information other than
"miscellaneous"-accounting for almost one-third of BIA's total deferred
maintenance cost estimate for its irrigation projects (see fig. 5).

o BIA made errors when compiling the total deferred maintenance cost
estimates. For example, BIA inadvertently double-counted the estimate
provided by the Colorado River Irrigation Project when compiling the
overall cost estimate, according to BIA officials. Additionally, BIA
officials erroneously estimated costs for all structures, such as flumes
and check gates, based on the full replacement values even when items were
in good or fair condition and needed only repairs. These structures
account for over one-third of BIA's total deferred maintenance estimate
(see fig. 5).

While the inclusion of incorrect items and calculation errors likely
overestimate BIA's total deferred maintenance costs, the incomplete
information provided by some projects may underestimate total costs.

Figure 5: Fiscal Year 2005 Cost Estimate of Deferred Maintenance by Type

To further refine its cost estimate and to develop more comprehensive
deferred maintenance lists, BIA plans to hire experts in engineering and
irrigation to periodically conduct thorough condition assessments of all
16 irrigation projects to identify deferred maintenance needs and costs.
According to BIA officials, these thorough condition assessments are
expected to more accurately reflect each project's actual deferred
maintenance, in part because experts in engineering and irrigation who can
differentiate between structural and cosmetic problems will conduct them.
These assessments will also help BIA prioritize the allocation of
potential funds to complete deferred maintenance items because they will
assign a prioritization rating to each deferred maintenance item based on
the estimated repair or replacement cost as well as the overall importance
to the project. The first such assessment was completed for the Flathead

Irrigation Project in July 2005,10 and BIA plans to reassess the condition
of each project at least once every 5 years, with the first round of such
condition assessments completed by the end of 2010.

Shortcomings in BIA's Management of Some Irrigation Projects Undermine
Effective Decisionmaking

BIA's management of some of its irrigation projects has serious
shortcomings that undermine effective decisionmaking about project
operations and maintenance. Under BIA's organizational structure, in many
cases, officials with the authority to oversee project managers'
decisionmaking lack the technical expertise needed to do so effectively,
while the staff who do have the expertise lack the necessary authority. In
addition, despite federal regulations that require BIA to consult with
project stakeholders in setting project priorities, BIA has not
consistently provided the information or opportunities necessary for
stakeholders-both Indian and non-Indian water users-to participate in
decisionmaking about project operations and maintenance. (See appendix II
for detailed information on key management concerns at each of the nine
projects we visited.)

In Many Cases, BIA Officials with Oversight Authority Lack Expertise,
While Those with Expertise Lack Authority

Under BIA's organizational structure, in many cases, officials with the
authority to oversee project managers' decisionmaking lack the expertise
needed to do so effectively, while the staff who do have the expertise
lack the necessary authority to oversee project managers' decisionmaking.
BIA regional directors, agency superintendents, and agency deputy
superintendents who oversee the projects do not generally have engineering
or irrigation expertise, and they rely heavily on the project managers to
run the projects. (See fig. 6 for an organizational chart showing the
lines of authority for providing oversight of a typical BIA irrigation
project.) Of the nine projects we visited, only two had managers at the
regional or agency levels who are experts in irrigation or engineering. At
the same time, BIA staff with the irrigation and engineering
expertise-regional irrigation engineers and central irrigation office
staff-have no authority over the 16 projects under BIA's current
organizational structure. Consequently, key technical decisions about
project operations and maintenance, such as when or how to repair critical
water delivery infrastructure, do not necessarily get the technical
oversight or scrutiny needed.

Figure 6: Misalignment of Expertise and Authority for a Typical BIA
Irrigation Project

This organizational structure and reliance on the project managers breaks
down when the person managing the project lacks the expertise required for
the position-that is, in cases in which BIA has had difficulty filling
project manager vacancies and has, as a result, hired less qualified
people or has the agency deputy superintendent temporarily serving in the
project manager position. Of the nine projects we visited, four lacked
project managers for all or part of the 2005 irrigation season and five
project managers were experts in engineering or irrigation.

The GAO Internal Control Management and Evaluation Tool recommends that
federal agencies analyze the knowledge and skills needed to perform jobs
appropriately and provides guidance on organizational structure and
identification of potential risks to the agency in that structure.11
Specifically, it recommends that adequate mechanisms exist to address
risks-such as the risks associated with staff vacancies or hiring less
qualified staff.

When the project manager is under-qualified and unchecked by managers who
heavily rely on his or her decisionmaking, the potential for adverse
impacts on the operations and maintenance of an irrigation project
increases. For example, at the Crow Irrigation Project in 2002, a project
manager with insufficient expertise decided to repair a minor leak in a
key water delivery structure by dismantling it and replacing it with a
different type of structure. The new structure was subsequently deemed
inadequate by BIA's irrigation experts, and the required reconstruction
delayed water delivery by about a month. In addition, at the Blackfeet
Irrigation Project in 2000, the accidental flooding and subsequent erosion
of a farmer's land was inadequately addressed by project and agency
management who decided to use a short-term solution over the objections of
the regional irrigation engineer, who lacked the authority to override the
project manager and agency superintendent's technical decision, despite
their lack of expertise. At the time of this report, the regional
irrigation engineer continues to negotiate the implementation of a
long-term and technically sound solution.

Furthermore, BIA lacks protocols to ensure that project managers consult
with, or get input from, BIA's technical experts before implementing
technically complex decisions about project operations and maintenance,
further exacerbating problems and undermining management accountability.
For example, in the 2002 incident at the Crow Irrigation Project discussed
above, the project manager was not required to consult with, notify, or
get approval from either the regional irrigation engineer or central
irrigation office staff, despite his lack of expertise and the complexity
of the flume replacement project he undertook. According to BIA officials,
if the project manager had consulted an engineer, his plan to replace the
flume with two small culverts would have been rejected before work began
because it was technically insufficient and would not have been completed
before the start of the approaching irrigation season.

BIA Has Not Consistently Provided Information and Opportunities for
Stakeholders to Participate in Setting Project Priorities

A second serious management shortcoming is the extent to which some
projects involve water users in decisionmaking. Federal regulations, as
well as BIA guidance, call for involving project stakeholders-that is,
tribal representatives as well as both Indian and non-Indian water
users-in the operations and maintenance of each project. Specifically,
federal regulations state that BIA is responsible for consulting with all
water users in setting program priorities; BIA's manual requires that BIA
provide regular opportunities for project water users to participate in
project operations; and BIA's Irrigation Handbook recommends that BIA meet
at least twice a year with project water users to discuss project budgets
and desired work.

Despite such requirements and recommendations, BIA has not consistently
provided the opportunities or information necessary for water users to
participate in such decisionmaking about project operations and
maintenance. The frequency of meetings between BIA and its project water
users varied considerably on the nine projects we visited, from rarely
(generally zero meetings per year), to periodically (generally more than
one meeting per year), to regularly (generally more than three meetings
per year), as shown in figure 9. For example, both the Blackfeet and
Colorado River Irrigation Projects hold regular meetings with both tribal
and individual water users, with meetings held quarterly at the Blackfeet
Irrigation Project and monthly at the Colorado River Irrigation Project.
In contrast, BIA officials on the Pine River Irrigation Project do not
meet with any non-tribal water users, and BIA officials at the Fort
Belknap Irrigation Project have held few water users meetings in recent
years. There was no meeting with water users at the Fort Belknap
Irrigation Project to kick-off the 2005 irrigation season because the
project manager position was vacant, worsening an already adversarial
relationship between water users and BIA, according to water users and a
local government official. Also, BIA officials on the Crow Irrigation
Project have no regularly scheduled meetings with either the tribe or
individual water users and, in fact, failed to send a single
representative to the meeting it called in 2005 for water users to voice
their concerns about project management and operations.

Figure 7: Opportunities for Water Users to Meet with BIA Varies by Project

aIndividual water users include Indians and/or non-Indians, depending on
the project.

In addition to a lack of regular meetings with all project water users,
BIA has not consistently shared the type of information about project
operations and finances that water users need to meaningfully participate
in project decisionmaking. Although BIA officials at the Colorado River
Irrigation Project share information on their budgets with water users and
work collaboratively with water users to develop annual work priorities in
accordance with BIA's Irrigation Handbook, not all projects we visited
provide or solicit this type of information. For example, BIA staff at the
Wapato Irrigation Project does not solicit water users' input on project
priorities or share information on the project's budget, according to
water users we spoke with, and BIA officials at the Crow Irrigation
Project do not share this type of critical information. However, some of
the projects we visited have recently begun to share information on
project spending and involve project water users in developing project
priorities, despite not doing so historically. For example, the project
management at the Blackfeet Irrigation Project began sharing budget
information with its water users during the 2005 season, and the new
project management at the Fort Belknap Irrigation Project stated that they
plan on involving project water users in setting project priorities in the
2006 season.

Moreover, although some project managers and their staff are approachable
and responsive on an individual basis, according to water users on some
projects we visited, others stated that project management on some of
BIA's irrigation projects were generally inaccessible and non-responsive.
For example, BIA officials acknowledged that a former project manager at
the Blackfeet Irrigation Project told water users to sue BIA to get
information on project decisionmaking. In addition, some expressed
concerns that BIA is less responsive to non-Indians because BIA's mission
does not specifically include non-Indians. Consequently, some non-Indian
water users have opted to go directly to their congressional
representatives to raise their concerns. For example, non-Indian water
users at the Wapato Irrigation Project have sought congressional
intervention on several occasions to help compel BIA staff to disclose
information about project finances, such as information related to
proposed operations and maintenance fee debts and data on project land not
being billed for operations and maintenance. In addition, Senator Conrad
Burns and Congressman Dennis Rehberg of Montana co-sponsored a town hall
meeting in 2003 to provide local water users an opportunity to voice
project concerns to BIA officials. Requests by non-Indian water users for
project management and regional staff to address the lack of water
delivery at the Crow Irrigation Project during the month of August 2005
went largely unanswered by BIA, resulting in congressional intervention.
Such lack of access and communication about project operations limits the
ability of water users to have an impact on project decisions as well as
the ability of BIA to benefit from this input.

Long-Term Direction of BIA's Irrigation Program Depends on Resolution of a
Number of Larger Issues

The long-term direction of BIA's irrigation program depends on the
resolution of several larger issues. Of most importance, BIA does not know
the extent to which its irrigation projects are capable of financially
sustaining themselves, which hinders its ability to address long-standing
concerns regarding inadequate funding. The future of BIA's irrigation
program also depends on the resolution of how the deferred maintenance
will be funded. BIA currently has no plans for how it will obtain funding
to fix the deferred maintenance items, and obtaining this funding presents
a significant challenge in times of tight budgets and competing
priorities. Finally, it might be more appropriate for other entities,
including other federal agencies, tribes, and water users, to manage some
or all of the projects.

The Extent to Which Projects Are Capable of Sustaining Themselves Is
Unknown

BIA does not know the extent to which Indian irrigation projects are
capable of sustaining themselves. Reclamation law and associated policy
require the Department of the Interior's Bureau of Reclamation to test the
financial feasibility of proposed projects comparing estimated
reimbursable project costs with anticipated revenues. The Bureau of
Reclamation then uses these reimbursable cost estimates to negotiate
repayment contracts with water users, where appropriate. In contrast,
Indian irrigation projects were authorized to support Indian populations
residing on reservations without regard to whether the projects could be
financially self-sustaining. As a result, neither the Congress nor project
stakeholders have any assurance that these projects can sustain
themselves. For example, a comprehensive 1930 study of BIA's irrigation
program concluded that the Blackfeet and Fort Peck Irrigation Projects
should be abandoned. Specifically, the report noted, "[a]fter a very
careful study of all the available data relating to these projects,
including a field examination, we are firmly convinced that any further
attempts to rehabilitate and to operate and maintain these projects ...
can result only in increasing the loss that must be accepted and sustained
by the Government. Adequate preliminary investigations and studies to
which every proposed project should be subjected, in our opinion, would
have condemned ... these ... projects as unfeasible."12 [Emphasis added.]

Despite this lack of information on the overall financial situation for
each of the projects, in the early 1960s BIA classified more than half of
its 16 projects as fully self-supporting, on the basis of annual
operations and maintenance fees they collected from water users. These
self-supporting projects do not receive any ongoing appropriated funds.
These projects are subject to full cost recovery despite the absence of
financial information to demonstrate that the water users could sustain
this financial burden. The Blackfeet and Fort Peck Irrigation Projects
were two of the projects classified as fully self-supporting. While the
specific financial situations for the Blackfeet and Fort Peck Irrigation
Projects have likely changed since the 1920s, BIA does not know if these
projects, or any of the other Indian irrigation projects, are financially
self-supporting.

The heavy reliance on water users to sustain these projects has created
ongoing tension between the water users and BIA. Some water users have
complained to BIA that they cannot afford the operations and maintenance
fees and they pressure BIA to keep the fees as low as possible. The Bureau
of Reclamation recently conducted a study of the Pine River Irrigation
Project and concluded that some of the water users could not conduct a
profitable farming operation with the 2005 operations and maintenance fee
of $8.50 per acre. BIA has not responded to the Bureau of Reclamation
study, and in October 2005 BIA proposed doubling the rate to $17.00 per
acre for the 2006 irrigation season even though water users claim that
they cannot afford to pay a higher fee.13 The operations and maintenance
fee has been set at $8.50 at the Pine River Irrigation Project since 1992
and, according to BIA officials, the collections do not provide adequate
funds to properly operate and maintain the project. As a result, BIA
estimates that the deferred maintenance at the project has grown to over
$20 million. Without definitive information on the financial situation of
each project, BIA cannot determine what portion of project operations and
maintenance costs can be reasonably borne by the water users and to what
extent alternative sources of financing, such as congressional
appropriations, should be pursued.

There Is No Plan for How to Fund the Deferred Maintenance

Despite the estimated $850 million in deferred maintenance and the degree
to which it impedes ongoing operations and maintenance at BIA's irrigation
projects, BIA currently has no plan for funding the list of deferred
maintenance items. Funding deferred maintenance costs in the hundreds of
millions of dollars will be a significant challenge in times of tight
budgets and competing priorities. Nonetheless, officials stated that the
agency has made little effort to identify options for funding the deferred
maintenance. BIA acknowledges that income from ongoing operations and
maintenance fees would likely be inadequate to cover the deferred
maintenance, yet the agency has done little to identify alternative means
of funding. According to officials, BIA has not asked the Congress for
supplemental funding to cover the deferred maintenance. For example, water
users report that the $7.5 million appropriated for BIA's irrigation
projects for fiscal year 2006 resulted from lobbying by concerned water
users, not from BIA's efforts.14 To date, BIA has primarily focused on
developing and refining an accurate estimate of the cost to fix the
deferred maintenance items. While developing an estimate of the projected
cost is important, BIA officials believe that the agency also needs to
develop a plan for ultimately funding the deferred maintenance.

Developing a plan for funding the deferred maintenance is complicated by
competing priorities and a crisis-oriented management style that
complicates preventative maintenance, according to BIA officials. The
current state of disrepair of most of the irrigation projects results in
frequent emergency situations concerning project operations and
maintenance. As a result, BIA irrigation staff spends a significant amount
of its time addressing emergency maintenance situations, to the detriment
of other maintenance needs that are essential to sustaining the projects
over the long term. As a result of this "crisis-style" management, BIA has
limited time to devote to non-emergency issues such as the list of
deferred maintenance items. Furthermore, this "crisis-style" management
prevents BIA from devoting adequate time to preventative maintenance. For
example, irrigation staff at Wind River Irrigation Project stated that
making "band-aid" emergency repairs on a regular basis prevents them from
addressing long-standing deferred maintenance needs, as well as from
conducting strategic improvements that would help sustain the project over
the long term.

It Might Be More Appropriate for Other Entities to Manage Some or All of
the Projects

It may be beneficial to consider whether other groups for whom irrigation
is a priority or an area of expertise could better manage some of the
irrigation projects, including other federal agencies, Indian tribes, and
water users. BIA must balance its irrigation management responsibilities
with its many other missions in support of Indian communities. As the
federal agency charged with supporting Indian communities in the United
States, BIA's responsibility is to administer and manage land and natural
resources held in trust for Indians by the U.S. government. Administration
and management of these trust lands and resources involves a wide variety
of responsibilities, including law enforcement, social services, economic
development, education and natural resource management. Given the
multitude of responsibilities that BIA must balance, there are inherent
limits on the resources and knowledge that BIA is able to devote to any
one program. As a result of these limitations and competing demands,
officials report that irrigation management is not a priority for BIA. The
fact that many water users on the irrigation projects are now non-Indian
may further encourage BIA to prioritize and devote more resources to other
programs before irrigation management.

Successful management of the irrigation projects by other groups would
depend on the unique characteristics of each project and its water users.
Potential groups who may be able to assume management for some irrigation
projects or portions of some irrigation projects include the following:

o The Bureau of Reclamation. As the federal agency charged with managing
water in the western United States, the Bureau of Reclamation has
extensive technical experience in managing irrigation projects and has
served in a technical or advisory capacity to BIA's irrigation staff.
Furthermore, efforts have been made in the past to turn over some BIA
irrigation projects to the Bureau of Reclamation and the Fort Yuma
Irrigation Project is currently operated by the Bureau of Reclamation. In
addition, the Bureau of Reclamation utilizes management practices for its
irrigation projects that maximize information sharing and collaboration
with water users. For example, in contrast to BIA, the Bureau of
Reclamation delegates responsibility for much of the day-to-day operations
and maintenance on its irrigation projects to irrigation districts, which
are organized groups of water users.

o Indian Tribes. Officials report that some of the tribes have staff with
extensive knowledge of irrigation and water management, as well as
technical training. Some tribes stated that they have a vested interest in
seeing their respective projects succeed, and they would like to assume
direct responsibility for their reservation's irrigation project, assuming
the deferred maintenance items are fixed before the turnover occurs.
Turning over some of the BIA projects to Indian tribes would be an option
where tribes have the management and technical capability to assume
responsibility for an irrigation project.

o Water Users. Water users have extensive familiarity with the day-to-day
management of the projects and in some cases already handle many
day-to-day operations and maintenance activities. For example, the
Crowheart Water Users Association, a group of water users at the Wind
River Irrigation Project, have successfully assumed responsibility for
most of the maintenance needs on their portion of the project. In exchange
for their efforts, BIA refunds to the Crowheart Water Users Association 50
percent of their annual operation and maintenance fees. Through this
arrangement, the Crowheart Water Users Association believes it has been
able to more effectively address maintenance needs and increase project
efficiency. Turning over some of the BIA projects to water users would be
an option where water users share similar interests and have positive
working relationships, as well as the desire to organize an irrigation
district or association.

Any successful alternative management option would have to consider the
sometimes disparate interests and priorities among water users. In some
cases, a combination of the various alternative management options may be
beneficial and feasible. This type of arrangement is currently being
considered for the Flathead Irrigation Project, where BIA is currently in
the process of turning over the operation and management of the project to
a collaborative management group that may include the tribe, individual
Indian water users, and non-Indian water users. However, regardless of the
alternative management option, water users and tribal officials repeatedly
stated that they would not be willing or able to take over project
operations and maintenance unless the deferred maintenance had already
been addressed or adequate funding was available to address the deferred
maintenance needs.

Conclusions

Since BIA historically has not had adequate funds to operate and maintain
the projects, the projects are in a serious state of disrepair. BIA is in
the process of implementing its plan to develop an accurate list and
estimate of the deferred maintenance needs for each project. However, some
of the projects also have day-to-day management shortcomings regarding
technical support and stakeholder involvement that need to be addressed.
BIA's decentralized organizational structure combined with the difficulty
in attracting and retaining highly qualified project managers at remote
Indian reservations led to some poor decisionmaking at some of the
projects. It is critically important that project managers, especially
those with less than desirable qualifications, have the necessary level of
technical support to prevent poor decisions from being made in the future.

A lack of adequate stakeholder involvement at some projects has also
seriously undermined project accountability. Unlike most other BIA
programs, the operations and maintenance of the irrigation projects are
funded almost entirely by the project beneficiaries-the water users, many
of whom are non-Indian. Consequently, BIA is accountable to these water
users and these water users expect to have an active voice in project
operations and maintenance. Some projects have not fulfilled their
obligations to regularly meet with project stakeholders, creating an
adversarial environment in which BIA and project water users do not trust
each other. This failure to involve stakeholders in the management of
their own projects means that BIA does not benefit from water user
expertise and has resulted in widespread feelings that BIA is
non-responsive and evasive, alienating many water users who feel
disenfranchised. Moreover, this failure has limited the ability of
stakeholders to hold BIA accountable for its decisions and actions.

In addition to some shortcomings with BIA's ongoing day-to-day management
of some of the projects, we also found that information on the financial
sustainability of the projects is needed to help address the long-term
direction of BIA's irrigation program. BIA's 16 irrigation projects were
generally built in the late 1800s and early 1900s to further the federal
government's Indian policy of assimilation. The government made the
decision to build these projects to support and encourage Indians to
become farmers. This decision was generally not based on a thorough
analysis designed to ensure that only cost effective projects were built.
As a result, the financial sustainability of some of the projects has
always been questionable, ultimately creating tension between BIA and its
water users. BIA is under constant pressure to raise annual operations and
maintenance fees to collect adequate funds to maintain the projects, while
many water users contend that they do not have the ability to pay higher
fees. Without a clear understanding of the financially sustainability of
the projects, BIA does not know whether it is practical to raise operation
and maintenance fees, or whether alternative sources of financing should
be pursued. Information on financial sustainability, along with accurate
deferred maintenance information, are both critical pieces of information
needed to have a debate on the long-term direction of BIA's irrigation
program. Once this information is available, the Congress and interested
parties will be able to address how the deferred maintenance will be
funded and whether entities other than BIA could more appropriately manage
some or all of the projects.

Recommendations for Executive Action

We recommend that the Secretary of the Interior take the following three
actions.

To improve the ongoing management of the projects in the short-term, we
recommend that the Secretary direct the Assistant Secretary for Indian
Affairs to

o provide the necessary level of technical support for project managers
who have less than the desired level of engineering qualifications by
putting these projects under the direct supervision of regional or central
irrigation office staff or by implementing more stringent protocols for
engineer review and approval of actions taken at the projects; and

o require, at a minimum, that irrigation project management meet twice
annually with all project stakeholders-once at the end of a season and
once before the next season-to provide information on project operations,
including budget plans and actual annual expenditures, and to obtain
feedback and input.

To obtain information on the long-term financial sustainability of each of
the projects, we recommend that the Secretary direct the Assistant
Secretary for Indian Affairs to conduct studies to determine both how much
it would cost to financially sustain each project, and the extent to which
water users on each project have the ability to pay these costs. This
information will be useful to congressional decisionmakers and other
interested parties in debating the long-term direction of BIA's irrigation
program.

Agency Comments and Our Evaluation

We provided the Department of the Interior with a draft of this report for
review and comment. However, no comments were provided in time to be
included as part of this report.

As agreed with your office, unless you publicly announce the contents of
this report earlier, we plan no further distribution until 30 days from
the report date. At that time, we will send copies of this report to the
Secretary of the Interior, the Assistant Secretary for Indian Affairs, as
well as to appropriate Congressional Committees, and other interested
Members of Congress. We also will make copies available to others upon
request. In addition, the report will be available at no charge on the GAO
Web site at http://www.gao.gov . Contact points for our Offices of
Congressional Relations and Public Affairs may be found on the last page
of this report.

If you or your staff have questions about this report, please contact me
at (202) 512-3841 or [email protected] . Key contributions to this report
are listed in appendix III.

Robin M. Nazzaro Director, Natural Resources   and Environment

Objectives, Scope, and Methodology Appendix I

We were asked to address several issues concerning the Department of the
Interior's Bureau of Indian Affairs' (BIA) management of its 16 irrigation
projects. Specifically, we were asked to examine (1) BIA's estimated
deferred maintenance cost for its 16 irrigation projects; (2) what
shortcomings, if any, exist in BIA's current management of its irrigation
projects; and (3) any issues that need to be addressed to determine the
long-term direction of BIA's irrigation program.

For all three objectives, we collected documentation on BIA's 16
irrigation projects from officials in each of BIA's central Irrigation,
Power, and Safety of Dams offices (central irrigation offices) located in
Washington, D.C., and other locations in the western United States. We
also visited and collected information from each of BIA's four regional
offices that oversee the 16 irrigation projects, including the Rocky
Mountain, Northwest, Western, and Southwest regions. In addition, we
visited 9 of the 16 projects located across all 4 regions. Specifically,
we visited: (1) the Blackfeet Irrigation Project, (2) the Colorado River
Irrigation Project, (3) the Crow Irrigation Project, (4) the Fort Belknap
Irrigation Project, (5) the Pine River Irrigation Project, (6) the San
Carlos Indian Works Irrigation Project, (7) the San Carlos Joint Works
Irrigation Project, (8) the Wapato Irrigation Project, and (9) the Wind
River Irrigation Project. We selected these projects based on a
combination of factors aimed at maximizing our total coverage (over 50
percent of the projects), visiting at least one project in each of the
regions where irrigation projects are located, visiting the project with
the highest deferred maintenance cost estimate in each region using BIA's
fiscal year 2004 data, and visiting what BIA considered to be the three
best projects and the five worst projects. During the site visits, we
collected project-specific information from BIA officials and project
stakeholders including tribes and water users. We also met with and
collected documentation from the Department of the Interior's Bureau of
Reclamation, the federal agency charged with managing water in the western
United States, for comparative purposes.

To examine BIA's estimated deferred maintenance cost for its 16 irrigation
projects, we toured each of the 9 projects we visited to see examples of
deferred maintenance and their impact, and we reviewed BIA's lists of
deferred maintenance items and associated cost estimates for both fiscal
years 2004 and 2005. We also reviewed the methodology BIA used to develop
these lists and estimates and interviewed BIA staff involved in developing
these lists and estimates to identify major deficiencies. Although we
analyzed the cost estimates provided by BIA, we did not develop our own
estimate of deferred maintenance. To assess the reliability of data we
received from BIA on deferred maintenance, we interviewed officials most
knowledgeable about the collection and management of these data. We
reviewed the relevant controls and found them adequate. We also conducted
tests of the reliability of the computerized data. On the basis of these
interviews, tests, and reviews, we concluded that BIA's estimates of
deferred maintenance were sufficiently reliable for the purposes of this
report.

To examine what shortcomings, if any, exist in BIA's current management of
its irrigation projects, we reviewed relevant federal regulations and
agency guidance, and analyzed BIA-wide and project-specific management
protocols and systems for the nine projects we visited. We also reviewed
general guidance on internal control standards, including risk assessment,
monitoring, and information and communication. We interviewed BIA
officials from the central irrigation office in Washington, D.C.,
Colorado, Oregon, Arizona and Montana. We also interviewed BIA regional
officials as well as agency and project officials associated with each of
the 9 projects we visited for information on key shortcomings in BIA's
management of its irrigation projects. Finally, we interviewed a variety
of project stakeholders-including tribal representatives, individual
Indian water users, and non-Indian water users-at each of the 9 projects
we visited for information on key shortcomings in BIA's management.

Finally, to examine any issues that need to be addressed to determine the
long-term direction of BIA's irrigation program, we reviewed previous
studies highlighting key issues impacting the future of BIA's irrigation
program. This included reviewing previous studies conducted by GAO, the
Department of the Interior's Office of Inspector General, and the Bureau
of Reclamation, as well as other studies conducted at the request of the
Congress. We also reviewed relevant federal regulations and agency
guidance, as well as historical information relevant to BIA's management
of the irrigation program, including budget information and agency memos.
Finally, we interviewed BIA officials from the central irrigation office,
regional offices, and the 9 projects we visited for information on the key
challenges impacting the long-term direction of the program. We also
interviewed project stakeholders-including tribal representatives and
water users-at the 9 projects we visited for information on the key issues
impacting the future direction of BIA's irrigation program.

We performed our work between March 2005 and February 2006 in accordance
with generally accepted government auditing standards.

Profiles of the Nine Irrigation Projects GAO Visited Appendix II

This appendix contains brief profiles of the nine irrigation projects we
visited. Each project profile begins with a short overview of basic facts
about the project, followed by a set of bullet points describing the key
operations and maintenance concerns and the key management concerns
expressed to us by BIA officials, tribal officials, or water users during
our site visits.

Blackfeet Irrigation Project

The Blackfeet Irrigation Project was authorized for construction in 1907,
but construction was never completed. It consists of 38,300 acres being
assessed operations and maintenance fees (and 113,100 acres authorized for
irrigation). The project is located in Browning, Montana on the Blackfeet
Indian Reservation of Montana, home of the Blackfeet Tribe. About 60
percent of the project's land is owned by either the tribe or individual
tribal members, and about 40 percent is owned by non-Indians. BIA
currently estimates the project's total deferred maintenance costs to be
$29,130,222. See figure 8 below for pictures of the Blackfeet Irrigation
Project.

Figure 8: Pictures of the Blackfeet Irrigation Project (July 2005)

Key Operations and Maintenance Concerns Expressed During Our Site Visit

o Fees are insufficient to cover the costs of project operations and
maintenance.

o Weeds and overgrown vegetation are problematic and impair water flow.

o Deferring maintenance has led to bigger and more costly maintenance
problems.

o Deferring maintenance decreases water efficiency and access to water.

o The project as built cannot meet the increased demand for water.

Key Management Concerns Expressed During Our Site Visit

o Communication between BIA and the water users could be improved, such as
enhancing transparency, increasing involvement, and meeting separately
with the tribe.

o Lack of training and expertise undermines BIA's management of the
project.

o Inadequate oversight within BIA exacerbates problems associated with
lack of training and expertise.

o Project staff should report to managers with expertise in irrigation
and/or engineering.

o BIA protocols are too vague, such as when project staff should consult
with regional or central irrigation office engineers.

o BIA needs to be able to measure water in order to better manage water
deliveries and identify critical problems.

o Irrigation is a low priority for BIA.

Colorado River Irrigation Project

The Colorado River Irrigation Project was the first BIA irrigation project
built, authorized for construction in 1867, but construction was never
completed. It is now considered the best of BIA's 16 revenue-generating
irrigation projects due, in part, to its innovative leadership and
customer service attitude. The project has adopted a user fee system that
measures and assesses water users based on their actual usage as well as
charging water users additional fees for using more water than their
individual allotment. The project is located in Parker, Arizona on the
Colorado River Indian Reservation, home of the Colorado River Indian
Tribes. The project, which has a 10-month-long irrigation season, consists
of 79,350 assessed acres (and 107,588 acres authorized for irrigation),
and is composed entirely of Indian land-land owned by the tribe or its
members. BIA currently estimates the project's total deferred maintenance
costs to be $134,758,664. See figure 9 for pictures of the Colorado River
Irrigation Project.

Figure 9: Pictures of the Colorado River Irrigation Project (June 2005)

Key Operations and Maintenance Concerns Expressed During Our Site Visit

o Development leases may no longer be allowed, potentially resulting in
irrigable land going un-irrigated and costing the tribe and project
potential revenues.

o Replacement of deteriorating irrigation structures needed.

o Canal needs new lining due to years of deterioration and, in some cases,
poor construction.

o Clearing moss and pondweed is needed lest the flow of water be impaired.

o New irrigation structures needed to regulate water flow where ditches
converge.

Key Management Concerns Expressed During Our Site Visit

o Understaffing and high turnover of project system operators adversely
impact water deliveries in that there are too few system operators to
deliver water in a timely manner.

o BIA procurement and contracting is time-consuming and costly.

o Annual project budget may understate actual funding because it does not
include possible additional fees.

o Operations and maintenance fees can only be used to address operations
and maintenance on the existing project, rather than expand the project.

Crow Irrigation Project

The Crow Irrigation Project was authorized for construction in 1890, but
construction was never completed. It is one of the oldest of BIA's 16
revenue-generating irrigation projects with 38,900 acres being assessed
operations and maintenance fees (and 46,460 acres authorized for
irrigation). The project is located in Crow Agency, Montana on the Crow
Reservation, home of the Crow Tribe of Montana. About 56 percent of the
project land is owned by either the tribe or individual tribal members,
and about 44 percent is owned by individual non-Indians. BIA currently
estimates the project's total deferred maintenance costs to be
$54,550,496. See figure 10 for pictures of the Crow Irrigation Project.

Figure 10: Pictures of the Crow Irrigation Project (March 2005)

Key Operations and Maintenance Concerns Expressed During Our Site Visit

o Fees are insufficient to cover the project's operations as well as
maintenance costs.

o Weeds, overgrown vegetation, tree roots and garbage impair water flow in
the canals and ditches.

o Crumbling or dilapidated irrigation structures impair water delivery.

o The repair of Rotten Grass Flume needs further work.

o Canal erosion causes sink holes and impairs water flow.

o Deferred maintenance of certain structures leads to safety concerns,
such as when BIA staff must go into the canal to raise or lower broken
check gates.

Key Management Concerns Expressed During Our Site Visit

o The project's recently reassigned project manager was under-qualified,
resulting in some decisions that hurt the project and undermine water
delivery, such as the Rotten Grass Flume incident.

o BIA has inadequate oversight of the project manager and his decisions.

o BIA relies on "crisis-style" management rather than a long-term plan to
manager project.

o Allegations that a former project manager inappropriately used fees and
was not accountable for financial decisions.1

o Communication breakdown between BIA and its water users.

o The project may be better managed if BIA turned over the project's
management to water users or tribe.

o Irrigation is a low priority for BIA.

Fort Belknap Irrigation Project

The Fort Belknap Irrigation Project was authorized for construction in
1895, but construction was never completed. It is one of the smallest of
BIA's 16 revenue-generating irrigation projects with 9,900 acres being
assessed operations and maintenance fees (and 13,320 acres authorized for
irrigation). The project is located in Harlem, Montana on the Fort Belknap
Reservation, home of the Fort Belknap Indian Community of the Fort Belknap
Reservation of Montana. About 92 percent of the land is owned by either
the tribe or individual tribal members, and about 8 percent is owned by
individual non-Indians. BIA currently estimates the project's total
deferred maintenance costs to be $17,535,494. See figure 11 for pictures
of the Fort Belknap Irrigation Project.

Figure 11: Pictures of the Fort Belknap Irrigation Project (July 2005)

Key Operations and Maintenance Concerns Expressed During Our Site Visit

o Fees and appropriations are insufficient to cover the project
maintenance needs.

o Weeds and overgrowth of vegetation impair water flow.

o Canal erosion caused by cattle-crossings impairs water flow.

o Deteriorated and leaking irrigation structures impair water delivery.

o Additional equipment is needed to conduct maintenance on project.

o Deferred maintenance exacerbates problems of poor farming land and low
crop values.

Key Management Concerns Expressed During Our Site Visit

o Poor communication and tense relations between BIA and water users.

o Staff turnover and difficulty finding qualified staff are problematic.

o Some project staff lack adequate expertise and training to manage
project.

o Lack of transparency and water management plan limits BIA
accountability.

o Some water users want BIA to begin water delivery earlier in season.

Pine River Irrigation Project

The Pine River Irrigation Project is the only one of BIA's 16
revenue-generating irrigation projects located in the Southwest region,
with 11,855 acres being assessed operations and maintenance fees.
Construction on the project was never completed. The project is located in
Ignacio, Colorado on the Southern Ute Reservation, home to the Southern
Ute Indian Tribe of the Southern Ute Reservation, Colorado. About 85
percent of the land is owned by either the tribe or individual tribal
members, and about 15 percent is owned by individual non-Indians. BIA
currently estimates the project's total deferred maintenance costs to be
$20,133,950. See figure 12 for pictures of the Pine River Irrigation
Project.

Figure 12: Pictures of the Pine River Irrigation Project (August 2005)

Key Operations and Maintenance Concerns Expressed During Our Site Visit

o Collections from operations and maintenance fees do not provide adequate
funds to properly operate and maintain the project.

o The project's operations and maintenance fees have not been raised since
1992. BIA has proposed doubling the fees from $8.50 per acre to $17.00 per
acre for the 2006 irrigation season.

o The project's cash reserves were depleted in 2004.

o The project has a number of old water delivery contracts, referred to as
"carriage contracts," from the 1930s that are at low fixed rates. Under
some of the contracts the water users only pay $1.00 per acre to the
project.

Key Management Concerns Expressed During Our Site Visit

o The practice of subsidizing the project through other BIA programs, such
as Natural Resources, Roads Construction, Roads Maintenance and Realty,
was scheduled to end at the end of fiscal year 2005. Alternative sources
of funds must be found for the project manager and clerk positions.

o "Crisis-style" management only, no preventive maintenance.

o Project staff does not formally meet with or provide information to
individual water users.

o A Bureau of Reclamation study in 1999 found that some of the water users
could not afford to pay fees of $8.50 to the project and operate a
profitable farming operation. BIA has not responded to the study.

o The former project manager stated that the BIA irrigation projects
should be turned over to the Bureau of Reclamation.

San Carlos Indian Works Irrigation Project (Pima)

The San Carlos Indian Works Irrigation Project was authorized for
construction in 1924, but construction was never completed. It is one of
the newest of BIA's 16 revenue-generating irrigation projects with 50,000
acres being assessed operations and maintenance fees (and 50,546 acres
authorized for irrigation). The project, also referred to as Pima, is
located in Sacaton, Arizona on the Gila River Indian Reservation, home of
the Gila River Indian Community. It is served both by its own
infrastructure and by that of the San Carlos Joint Works Irrigation
Project. The project land is generally owned by the tribe or tribal
members, with about 99 percent of the land owned by either the tribe or
individual tribal members, and about 1 percent owned by individual
non-Indians. BIA currently estimates Pima's total deferred maintenance
costs to be $62,865,503. See figure 13 for pictures of the San Carlos
Indian Works Irrigation Project.

Figure 13: Pictures of the San Carlos Indian Works Irrigation Project
(June 2005)

Key Operations and Maintenance Concerns Expressed During Our Site Visit

o Inefficiency  in water delivery results in fewer water users being able
to receive water, leading to idle acreage in some cases.

o Clearing tumbleweeds and other vegetation that can clog culverts are a
recurring problem and represents a large part of the project's spending on
operations and maintenance.

o Erosion is a continuing problem, in part, because the canal is used for
both water deliveries as well as drainage.

o BIA staff has a "wish list" of items that would bring the project into
top condition, extending beyond the basic deferred maintenance.

o Project infrastructure may not have the capacity to deliver water to all
potential water users.

Key Management Concerns Expressed During Our Site Visit

o 2007 turnover to water users is still underway.

o Insufficient reserve funds means that project staff may not have enough
money to conduct needed maintenance towards the end of the year.

o Vacancies are a constant problem at the project, leaving too few staff
to conduct project maintenance.

o BIA is too slow to respond to water users' requests for repairs.

San Carlos Joint Works Irrigation Project (Coolidge)

The San Carlos Joint Works Irrigation Project was authorized for
construction in 1924, but construction was never completed. It provides
water to non-Indian irrigators as well as the San Carlos Indian Works
Irrigation Project. It consists of 100,000 acres being assessed operations
and maintenance fees (and 100,546 acres authorized for irrigation), with
50 percent of the land owned by non-Indian irrigators and 50 percent owned
by Indian irrigators (in the form of the San Carlos Indian Works
Irrigation Project). The project is located in Coolidge, Arizona. BIA
currently estimates Coolidge's total deferred maintenance costs to be
$5,775,427. See figure 14 for pictures of the San Carlos Joint Works
Irrigation Project.

Figure 14: Pictures of the San Carlos Joint Works Irrigation Project (June
2005)

Key Operations and Maintenance Concerns Expressed During Our Site Visit

o Lack of certainty in BIA's ability to deliver requested water to all
water users has led some to purchase additional water from outside of the
project.

o Silt removal from irrigation canals and ditches is a recurring problem,
leading BIA to purposefully over-excavate the main canal each year in an
attempt to catch excess silt that can clog culverts and prevent water
delivery impairments.

o Repair of China Wash Flume is an expensive undertaking, but the flume's
failure could jeopardize water deliveries for much of the project.

o Removal of weeds to prevent clogged culverts is a recurring problem for
the project.

Key Management Concerns Expressed During Our Site Visit

o 2007 turnover to water users is under way but not finalized.

o Lawsuit against BIA's increase in operations and maintenance fees
resulted in some water delivery delays while the lawsuit is pending.

o Contracting delays within BIA have resulted in postponed project
maintenance.

o Turnover of BIA staff and lack of water user inclusion in project
decisionmaking impedes effective communication.

o BIA lacks accountability to water users in terms of how it spends
operations and maintenance fees.

Wapato Irrigation Project

The Wapato Irrigation Project is one of the oldest and largest of BIA's 16
revenue-generating irrigation projects with 96,443 acres being assessed
operations and maintenance fees (and 145,000 acres authorized for
irrigation). It was authorized for construction in 1904, but construction
was never completed. The project is located in Yakima, Washington on the
Yakama Reservation, home of the Confederated Tribes and Bands of the
Yakama Nation. About 60 percent of the project land is owned by either the
tribe or individual tribal members, and about 40 percent is owned by
individual non-Indians. BIA currently estimates the project's total
deferred maintenance costs to be $183,128,886. See figure 15 for pictures
of the Wapato Irrigation Project.

Figure 15: Pictures of the Wapato Irrigation Project (April 2005)

Key Operations and Maintenance Concerns Expressed During Our Site Visit

o Deterioration of project prevents some water users from receiving water.

o Lack of regular project maintenance has led many water users to make
repairs on their own in order to irrigate crops.

o Water users claim that project staff performs inadequate or faulty
repairs, resulting in wasted operations and maintenance payments or the
need for water users to fix the sloppy repairs.

o Fees are insufficient because (a) rates have been set too low, and (b)
the tribe's appeal of BIA's operations and maintenance bills since 2001
has decreased income by at least $2 million annually because the agency
will not collect on these bills or issue subsequent bills until the
matters raised in the appeal are resolved.

o Fees are insufficient to cover both maintenance and administrative
costs, such as salaries and benefits, leading to suggestions that BIA
cover such costs.

Key Management Concerns Expressed During Our Site Visit

o Understaffing due to inadequate funds and difficulty in finding
qualified staff has resulted in too few staff to operate and maintain
project.

o BIA relies on "crisis-style" management to manage project, resulting in
a lack of planning and preventive maintenance.

o Water users lack voice in project decisionmaking, resulting in concerns
about limited accountability of project staff to its water users.

o Alleged errors with operations and maintenance billing-such as BIA
billing dead landowners and BIA overbilling living landowners-led the
tribe and its members to appeal BIA's billing of operations and
maintenance fees. Resolution of these appeals is still pending within the
agency. BIA will not collect on these bills or issue subsequent bills
until the matters raised in the appeal are resolved.

Wind River Irrigation Project

The Wind River Irrigation Project was authorized for construction in 1905,
but construction was never completed. It is one of BIA's 16
revenue-generating irrigation projects with 38,300 acres being assessed
operations and maintenance fees (and 51,000 acres authorized for
irrigation). The project is located in Fort Washakie, Wyoming on the Wind
River Reservation, home of the Arapaho Tribe of the Wind River Reservation
and the Shoshone Tribe of the Wind River Reservation. About 67 percent of
the project land is owned by either the tribe or individual tribal
members, and about 33 percent is owned by individual non-Indians. BIA
currently estimates the project's total deferred maintenance costs to be
$84,956,546. See figure 16 for pictures of the Wind River Irrigation
Project.

Figure 16: Pictures of the Wind River Irrigation Project (July 2005)

Key Operations and Maintenance Concerns Expressed During Our Site Visit

o Weeds and tree roots impair water flow and lead to seepage.

o Cattle-crossings erode canal banks and impair water flow.

o Deteriorating irrigation infrastructure impairs water delivery.

o Additional water storage and improved efficiency needed to meet demand
for water.

o Deferring maintenance undermines long-term sustainability of project.

o BIA financial management may limit ability of project staff to conduct
needed maintenance in short maintenance season.

Key Management Concerns Expressed During Our Site Visit

o BIA relies on "crisis-style" management and "band-aid" solutions rather
than a long-term plan to manage project.

o Poor communication between BIA and water users.

o Water users are not involved enough in project decisionmaking.

o Supervision of project staff is insufficient and BIA is not accountable
to water users.

o Turnover of BIA staff is problematic.

o Some water users want to manage all or part of the project.

GAO Contact and Staff Acknowledgments Appendix III

Robin M. Nazzaro, (202) 512-3841, [email protected]

In addition to those individuals named above, Jeffery D. Malcolm,
Assistant Director, Tama R. Weinberg, Rebecca A. Sandulli, and David A.
Noguera made key contributions to this report. Also contributing to the
report were Richard P. Johnson, Nancy L. Crothers, Stanley J. Kostyla, Kim
M. Raheb, and Jena Y. Sinkfield.

(360549)

www.gao.gov/cgi-bin/getrpt? GAO-06-314 .

To view the full product, including the scope

and methodology, click on the link above.

For more information, contact Robin M. Nazzaro at (202)512-3841 or
[email protected].

Highlights of GAO-06-314 , a report to the Chairman, Subcommittee on
Interior and Related Agencies, Committee on Appropriations, U.S. Senate

February 2006

INDIAN IRRIGATION PROJECTS

Numerous Issues Need to Be Addressed to Improve Project Management and
Financial Sustainability

The Department of the Interior's Bureau of Indian Affairs (BIA) manages 16
irrigation projects on Indian reservations in the western United States.
These projects, which were generally constructed in the late 1800s and
early 1900s, include water storage facilities and delivery structures for
agricultural purposes. Serious concerns have arisen about their
maintenance and management.

GAO was asked to examine (1) BIA's estimated deferred maintenance cost for
its 16 irrigation projects, (2) what shortcomings, if any, exist in BIA's
current management of its irrigation projects, and (3) any issues that
need to be addressed to determine the long-term direction of BIA's
irrigation program.

What GAO Recommends

GAO recommends that BIA (1) provide the necessary level of technical
support to project managers, (2) require project managers to meet at least
twice annually with water users, and (3) conduct studies to determine the
financial sustainability of the projects.

Although we requested comments from the Department of the Interior on our
findings and recommendations, none were provided in time to be included as
part of this report.

BIA estimated the cost for deferred maintenance at its 16 irrigation
projects at about $850 million for 2005, although the agency is in the
midst of refining this estimate. BIA acknowledges that this estimate is a
work in progress, in part, because some projects incorrectly counted new
construction items as deferred maintenance. To further refine its
estimate, BIA plans to hire engineering and irrigation experts to conduct
thorough condition assessments of all 16 irrigation projects to correctly
identify deferred maintenance needs and costs.

BIA's management of some of its irrigation projects has serious
shortcomings that undermine effective decisionmaking about project
operations and maintenance. First, under BIA's organizational structure,
officials with the authority to oversee irrigation project managers
generally lack the technical expertise needed to do so effectively, while
the staff that have the expertise lack the necessary authority. Second,
despite federal regulations that require BIA to consult with project
stakeholders in setting project priorities, BIA has not consistently
provided project stakeholders with the necessary information or
opportunities to participate in project decisionmaking.

The long-term direction of BIA's irrigation program depends on the
resolution of several larger issues. Of most importance, BIA does not know
to what extent its irrigation projects are capable of financially
sustaining themselves, which hinders its ability to address long-standing
concerns regarding inadequate funding. Information on financial
sustainability, along with accurate deferred maintenance information, are
two critical pieces of information that are needed to have a debate on the
long-term direction of BIA's irrigation program. Once this information is
available, the Congress and interested parties will be able to address how
the deferred maintenance will be funded and whether entities other than
BIA could more appropriately manage some or all of the projects.

Deferred Maintenance at the Crow Irrigation Project (March 2005)

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