Coastal Barrier Resources System: Status of Development That Has 
Occurred and Financial Assistance Provided by Federal Agencies	 
(19-MAR-07, GAO-07-356).					 
                                                                 
In 1982, Congress enacted the Coastal Barrier Resources Act. The 
Coastal Barrier Resources Act, as amended (CBRA), designates 585 
units of undeveloped coastal lands and aquatic habitat as the	 
John H. Chafee Coastal Barrier Resources System (CBRS). CBRA	 
prohibits most federal expenditures and assistance within the	 
system that could encourage development, but it allows federal	 
agencies to provide some types of assistance and issue certain	 
regulatory permits. In 1992, GAO reported that development was	 
occurring in the CBRS despite restrictions on federal assistance.
GAO updated its 1992 report and reviewed the extent to which (1) 
development has occurred in CBRS units since their inclusion in  
the system and (2) federal financial assistance and permits have 
been provided to entities in CBRS units. GAO electronically	 
mapped address data for structures within 91 randomly selected	 
CBRS units and collected information on federal financial	 
assistance and permits for eight federal agencies.		 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-07-356 					        
    ACCNO:   A66984						        
  TITLE:     Coastal Barrier Resources System: Status of Development  
That Has Occurred and Financial Assistance Provided by Federal	 
Agencies							 
     DATE:   03/19/2007 
  SUBJECT:   Coastal zone management				 
	     Conservation programs				 
	     Disaster relief aid				 
	     Erroneous payments 				 
	     Federal regulations				 
	     Federal/state relations				 
	     Government guaranteed loans			 
	     Housing programs					 
	     Insurance						 
	     Land management					 
	     Property						 
	     Policies and procedures				 
	     Coastal Barrier Resources System			 

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GAO-07-356

   

     * [1]Results in Brief
     * [2]Background
     * [3]CBRS Remains Largely Undeveloped

          * [4]The Majority of CBRS Units Have Not Experienced Development
          * [5]A Small Percentage of Units Have Experienced Some Level of D

     * [6]The Extent to Which Federal Agencies Have Provided Financial

          * [7]Four Federal Agencies Have Provided Some Financial Assistanc

               * [8]FEMA National Flood Insurance Program
               * [9]FEMA Individuals and Households Program
               * [10]Department of Housing and Urban Development
               * [11]Small Business Administration
               * [12]Department of Veterans Affairs

          * [13]Federal Agencies Have Provided Assistance That Is Allowable

               * [14]Federal Emergency Management Agency
               * [15]Federal Highway Administration
               * [16]Corps of Engineers

          * [17]EPA-Authorized State Agencies and the Corps Have Issued Perm

     * [18]Conclusions
     * [19]Recommendations for Executive Action
     * [20]Agency Comments and Our Evaluation

          * [21]Determining the Extent of Development in CBRS Units
          * [22]Determining the Extent of Federal Assistance Provided to CBR

               * [23]FEMA National Flood Insurance Program
               * [24]FEMA IHP Program
               * [25]SBA
               * [26]HUD Housing Programs
               * [27]VA Home Loan Guaranty Program
               * [28]USDA Business and Industry, Community Facilities, and
                 Housin
               * [29]USDA Utility Programs
               * [30]FEMA Public Assistance Grant Program
               * [31]Federal Highway Administration

     * [32]Massachusetts
     * [33]Rhode Island
     * [34]South Carolina
     * [35]Florida
     * [36]North Carolina

          * [37]U.S. Army Corps of Engineers
          * [38]U.S. Department of Agriculture
          * [39]Department of Homeland Security
          * [40]U.S. Coast Guard
          * [41]Department of Housing and Urban Development
          * [42]Environmental Protection Agency
          * [43]Federal Highway Administration
          * [44]Small Business Administration
          * [45]Department of Veterans Affairs

     * [46]GAO Contact
     * [47]Staff Acknowledgments
     * [48]GAO's Mission
     * [49]Obtaining Copies of GAO Reports and Testimony

          * [50]Order by Mail or Phone

     * [51]To Report Fraud, Waste, and Abuse in Federal Programs
     * [52]Congressional Relations
     * [53]Public Affairs

Report to the Honorable Wayne T.Gilchrest, House of Representatives

United States Government Accountability Office

GAO

March 2007

COASTAL BARRIER RESOURCES SYSTEM

Status of Development That Has Occurred and Financial Assistance Provided
by Federal Agencies

GAO-07-356

Contents

Letter 1

Results in Brief 4
Background 6
CBRS Remains Largely Undeveloped 10
The Extent to Which Federal Agencies Have Provided Financial Assistance
and Permits to Entities in CBRS Units Varies 16
Conclusions 26
Recommendations for Executive Action 27
Agency Comments and Our Evaluation 27
Appendix I Objectives, Scope, and Methodology 29
Appendix II CBRS Units We Reviewed 35
Appendix III Snapshots of Selected CBRS Units 40
Massachusetts 40
Rhode Island 43
South Carolina 47
Florida 49
North Carolina 52
Appendix IV Programs and Types of Federal Assistance Analyzed 57
Appendix V Comments from the Department of Housing and Urban Development
60
Appendix VI Comments from the Department of the Interior 62
Appendix VII Comments from the Department of Veterans Affairs 64
Appendix VIII GAO Contact and Staff Acknowledgments 66

Tables

Table 1: Examples of FEMA Disaster Assistance Since 1998 24
Table 2: CBRS Units Included in Random Sample and Approximate Number of
New Structures 35
Table 3: CBRS Units Included in GAO's Random Sample That Were Analyzed to
Determine the Extent of Federal Expenditures and Permits 38
Table 4: Additional CBRS Units Suggested for Review by FWS That Were
Analyzed to Determine the Extent of Federal Expenditures and Permits 39

Figures

Figure 1: Boat Meadow CBRS Unit in Massachusetts 11
Figure 2: CBRS Units We Visited in Massachusetts 41
Figure 3: House and Beach on the Squaw Island, CBRS Unit in Massachusetts
42
Figure 4: CBRS Units We Visited in Rhode Island 44
Figure 5: Home with a Backyard in the Prudence Island, Rhode Island CBRS
Unit 45
Figure 6: Portion of the Prudence Island Complex CBRS Unit 46
Figure 7: Inlet Where Proposed Dredging Project Would Occur in the
Prudence Island CBRS Unit 47
Figure 8: CBRS Units We Visited in South Carolina 48
Figure 9: CBRS Units We Visited in Florida 50
Figure 10: CBRS Units We Visited in North Carolina 53
Figure 11: House in North Topsail CBRS Unit on the Edge of the Ocean 55

Abbreviations

CBRA Coastal Barrier Resources Act as amended
CBRS John H. Chafee Coastal Barrier Resources System
DHS Department of Homeland Security
DOI Department of the Interior
EPA Environmental Protection Agency
FEMA Federal Emergency Management Agency
FHWA Federal Highway Administration
FWS Fish and Wildlife Service
HUD Department of Housing and Urban Development
IHP FEMA's Individuals and Households Program
NFIP FEMA's National Flood Insurance Program
NOAA National Oceanic and Atmospheric Administration
NPDES EPA's National Pollutant Discharge Elimination System
OPA Otherwise Protected Areas
SBA Small Business Administration
VA Department of Veterans Affairs

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United States Government Accountability Office

Washington, DC 20548

March 19, 2007

The Honorable Wayne T. Gilchrest
House of Representatives

Dear Mr. Gilchrest:

The U.S. coasts are among the most rapidly growing and developed areas in
the nation. From 1980 to 2003, the population in U.S coastal areas is
estimated to have increased by 33 million people and is projected to
increase by another 7 million people by 2008. Coastal barriers, such as
islands and broad sandy barrier beaches, serve as the mainland's first
line of defense against the impacts of hurricanes and coastal storms.
These areas are also biologically rich and provide protection for a
variety of fish and wildlife species, including migratory birds,
shellfish, and sea turtles. While the geological composition of coastal
barriers makes them highly unstable areas on which to build, their
desirable waterfront locations make them attractive for development. As
development and population increase, the risk to human life, property, and
valuable habitat increases, and the natural buffers that minimize storm
damage are degraded. For example, when Hurricane Isabel made landfall
along North Carolina's Outer Banks in 2003, it caused widespread wind and
storm surge damage to several piers, several thousand homes and
businesses, and damaged or washed away sections of a highway.

Recognizing that development in coastal barrier areas can be impacted by
the actions and programs of the federal government, Congress enacted the
Coastal Barrier Resources Act in 1982. The stated purpose of the Coastal
Barrier Resources Act as amended (CBRA) is to minimize (1) the loss of
human life; (2) wasteful expenditures of federal revenue; and (3) damage
to fish, wildlife, and other natural resources associated with coastal
barriers along the Atlantic and Gulf Coasts and the shores of the Great
Lakes by restricting future federal expenditures and financial assistance,
which have the effect of encouraging development of coastal barriers.
Through CBRA, Congress designated 585 units of undeveloped coastal land
and associated aquatic habitats comprising nearly 1.3 million acres as the
John H. Chafee Coastal Barrier Resources System (CBRS).^1 Congress,
through the Coastal Barrier Improvement Act of 1990, also designated an
additional 1.8 million acres already held for conservation or recreation,
such as national wildlife refuges, national parks and seashores, and state
and county parks, as otherwise protected areas (OPA).

^1For the purposes of CBRA, a coastal barrier was considered undeveloped
if the density of development was less than one structure per 5 acres of
land above mean high tide.

CBRA does not prohibit development in CBRS units by owners willing to
develop their properties without the benefit of federal financial
assistance, such as federal flood insurance, loans, grants, subsidies or
other forms of direct or indirect federal assistance.^2 Instead, with
certain exceptions, CBRA prohibits federal expenditures or financial
assistance within CBRS units that might encourage development. The
prohibition includes--but is not limited to--the issuance of flood
insurance policies, home loans, loan guarantees, and new or expanded
infrastructure construction within CBRS units. However, the act does
exempt certain federal expenditures or financial assistance from the
general prohibition, such as emergency operations that are essential to
saving lives, maintaining and replacing existing publicly owned
infrastructure, energy development, and activities related to national
security. In addition, CBRA allows agencies to issue permits to entities
within the CBRS for certain federally regulated activities, such as the
construction of bridges and docks or the discharge of dredged or fill
materials into waters that fall under federal jurisdiction.

Under CBRA, no single federal agency is assigned overall responsibility
for administering activities in the CBRS; instead, all federal agencies
must abide by the provisions of the act and are required to certify
annually that they are in compliance with CBRA.^3 CBRA does assign the
Secretary of the Interior responsibility for, among other things, the
tasks of consulting with other federal agencies that propose spending
funds within the CBRS, maintaining maps for each CBRS unit, and
recommending modifications to CBRS unit boundaries, as needed. These maps
are used by property owners; federal, state, and local agencies; and other
parties, such as insurance agents, to determine whether a property or
planned project is within a CBRS unit and therefore whether it is
ineligible for federal financial assistance. Within the Department of the
Interior (DOI) these responsibilities belong to the U.S. Fish and Wildlife
Service (FWS). The existing maps that depict CBRS unit boundaries are
outdated technologically and present challenges to users. In May 2006, the
Congress directed the Secretary of the Interior to initiate a map
modernization project for all of the units in the CBRS that is to be
completed by 2013.^4 This effort is designed to create digital maps of all
CBRS units that are more accurate and less time consuming for agencies and
others to use than the maps currently available.

^2Financial assistance as defined by the act does not include general
revenue sharing grants; deposit or account insurance for customers of
financial institutions; the purchase of mortgages or loans by federal
associations or corporations such as the Federal National Mortgage
Association; assistance for environmental studies, planning, and other
assessments that are required incident to the issuance of permits or other
authorizations under federal law; and assistance for programs entirely
unrelated to development, such as the federal old-age survivors or
disability insurance program.

^3Such reports and certifications shall be submitted annually to the
Secretary of the Interior. 16 U.S.C. S 3506(b).

In 1992, we reported that development was occurring in some CBRS units
despite restrictions on federal assistance.^5 CBRA has been amended
several times and the CBRS has expanded to include significantly more
units. In this context, you asked us to update our 1992 report and review
the extent to which (1) development has occurred in the CBRS and (2)
federal agencies have provided financial assistance and issued permits to
entities in CBRS units.

To determine the extent of development that has occurred within CBRS
units, we selected a stratified random sample of 91 units located
throughout the system. The sample included units designated as part of the
system in 1982 and 1990. We did not include otherwise protected areas in
our analysis. For each unit, we obtained and electronically mapped address
or parcel data for structures within the unit boundaries.^6 Throughout
this report, the percentage of units that have experienced development is
a statistical estimate based on our analysis of the development in the 91
randomly selected units, which can be projected to the entire system. The
random sample was stratified by region to select an equal number of units
in northern and southern regions. In addition, we conducted site visits
and/or interviewed officials for a subset of 59 units in 13 states to
determine the extent of and reasons for development. To determine the
extent of federal expenditures and financial assistance made to
individuals and entities within CBRS units, we identified and collected
information on financial assistance provided in selected CBRS units from
those federal agencies that, based on our previous report and our
discussions with FWS, were the most likely to have provided assistance.
These agencies include the Department of Homeland Security's (DHS) Federal
Emergency Management Agency (FEMA), Federal Highway Administration (FHWA),
Small Business Administration (SBA), U.S. Army Corps of Engineers (the
Corps), U.S. Department of Agriculture, Department of Housing and Urban
Development (HUD), and the Department of Veterans Affairs (VA). We also
interviewed officials with these agencies about the agencies' procedures
for preventing prohibited expenditures from being provided to individuals
and entities in CBRS units. To determine the extent to which federal
agencies issued permits for projects within selected CBRS units, we
interviewed officials and analyzed data provided by the Corps, the
Environmental Protection Agency (EPA), and state agencies authorized to
administer EPA programs. The information we gathered on federal financial
assistance and permits cannot be generalized to the entire universe of
CBRS units. We determined that the agency data were sufficiently reliable
for the purposes of our review. A more detailed description of our scope
and methodology is presented in appendix I. We performed our work between
February 2006 and February 2007 in accordance with generally accepted
government auditing standards.

^4Coastal Barrier Resources Reauthorization Act of 2005, Pub. L. No.
109-226, S 4(a), 120 Stat 381.

^5GAO, Coastal Barriers: Development Occurring Despite Prohibitions
Against Federal Assistance, [54]GAO/RCED-92-115 (Washington, D.C.: July
17, 1992). Our 1992 report only covered units designated by the original
1982 act.

^6We electronically mapped the location of the addresses using MapInfo
Software.

Results in Brief

Most units within the CBRS remain undeveloped; however, about 3 percent of
units have experienced significant levels of development. Specifically, an
estimated 84 percent of all CBRS units have remained undeveloped (no new
structures were built) since they were included in the system, while about
13 percent have experienced minimal levels of development--consisting of
less than 20 additional structures per unit since becoming part of the
CBRS. An estimated 3 percent of units experienced significant
development--consisting of 100 or more structures per unit--since becoming
part of the CBRS. According to federal and local officials, CBRA has
played little role in the extent of development within the CBRS units that
we reviewed. For those units that have remained undeveloped, officials
identified the following factors as being primarily responsible for
inhibiting development (1) the lack of suitably developable land in the
unit; (2) the lack of accessibility to the unit; (3) state laws
discouraging development within coastal areas; and (4) ownership of land
within the unit by groups, such as the National Audubon Society, who are
seeking to preserve the natural state of the unit. For those units that we
reviewed where development has occurred, local officials said that CBRA
did little to discourage development and identified the following factors
as being primarily responsible for contributing to development: (1) a
combination of commercial interest and public desire to build in the unit,
(2) local government support for development to improve the economic base
of the area, and (3) the availability of affordable private flood
insurance. Overall, we found that CBRS units in the southern region of the
United States are experiencing greater development than units in the
north. This is largely because the amount of developable land is greater
in the south.

Federal agencies have provided some financial assistance that is
prohibited by CBRA, some assistance that is allowed under CBRA, and issued
hundreds of permits for federally regulated construction projects to
property owners and other entities in CBRS units. More specifically,

           o Four agencies--FEMA, HUD, SBA, and VA--provided financial
           assistance to property owners in CBRS units that is prohibited by
           CBRA. For example, we determined that 73 FEMA flood insurance
           policies with total policy values of $20 million and 5 HUD insured
           loans totaling $384,000 were made to entities in CBRS units and
           were active in 2006. While FEMA, SBA, and VA have procedures in
           place intended to prevent prohibited financial assistance from
           being provided to property owners in CBRS units, HUD does not have
           such procedures. FEMA officials cited the lack of updated CBRS
           maps and limitations with mapping technology as the primary
           reasons why errors were made and assistance was provided to
           entities within the CBRS. FWS has begun a congressionally directed
           effort to modernize and correct CBRS unit maps. However, according
           to FWS officials, completing that effort is contingent upon
           receiving specific funding for the effort. In the meantime, FWS is
           working with FEMA to update the digital flood maps used by
           FEMA--an effort that should improve FEMA's, insurance agents' and
           other's ability to determine if a property is eligible for federal
           flood insurance. VA and SBA officials acknowledged that they had
           provided assistance prohibited by CBRA and told us that they will
           monitor compliance with their procedures more carefully in the
           future. HUD officials told us that they have no procedures under
           their single-family mortgage insurance programs related to CBRA
           because it would be unnecessary in practical terms. For example,
           agency officials believed it was unlikely that these programs
           would fund projects in the CBRS because of the high-priced homes
           generally found in these areas. In response to our findings, HUD
           officials said that they would be developing CBRA policy guidance
           and associated training to ensure future compliance.
           o Three federal agencies have provided some financial assistance
           that is allowed under CBRA, but the total extent of this
           assistance is unknown. For example, in the past 10 years, FEMA has
           provided at least $5.6 million in disaster assistance to the unit
           in North Topsail, North Carolina, for debris removal and repairs.
           Similarly, FHWA has provided $1.1 million for road repair to the
           unit in Cape San Blas, Florida. However, because these federal
           agencies do not track the amount of allowable financial assistance
           they provide to CBRS units, they could not provide us with the
           complete and reliable data needed to estimate the total extent of
           such assistance.
           o The Corps and states authorized by the EPA have issued hundreds
           of permits allowed by CBRA to entities within the CBRS. Since
           1983, in 20 CBRS units the Corps issued at least 194 permits to
           allow, among other things, the construction of piers, mosquito
           control ditches, erosion control areas, and the raising of fish
           and shellfish. Similarly, since 1983, in 9 CBRS units
           EPA-authorized state agencies issued 41 permits, primarily for
           storm water runoff from construction activities and the discharge
           of water from treatment systems.

           We are recommending that FEMA, HUD, SBA, and VA obtain official
           determinations from FWS on whether the properties we identified as
           receiving federal assistance in violation of CBRA are in fact
           located within a CBRS unit and cancel all inappropriate loan
           guarantees and insurance policies. We are also recommending that
           these agencies examine their policies and procedures to ensure
           that they are adequate to prevent federal assistance from being
           provided to entities in CBRS units. In addition, so that federal
           agencies and other parties can more accurately determine whether a
           property is within CBRA and whether it is eligible for assistance,
           we recommend that FWS place a high priority on completing its
           efforts to develop digital maps that more accurately depict unit
           boundaries. In commenting on our report, DHS, DOI, and HUD
           generally agreed with our recommendations. SBA had no comment on
           the draft report. VA agreed with our findings and one of our
           recommendations but did not concur with the recommendation to
           cancel all inappropriate loan guarantees, stating that it would
           inflict disproportionate harm on lenders and veterans. While we
           understand VA's concerns about the adverse effect that this could
           have on the potentially affected parties, we believe that VA
           should rescind these loan guarantees because they were made in
           violation of CBRA.
			  
			  Background

           Coastal barriers are unique land forms that function as buffers,
           protecting the mainland against the destructive forces of
           hurricanes and other coastal storms. Coastal barriers also provide
           habitat for migratory birds and other wildlife; and they provide
           essential nesting and feeding areas for commercially and
           recreationally important species of fish and other aquatic
           organisms such as sea turtles. In the United States, coastal
           barriers are predominantly distributed along the Atlantic and Gulf
           coasts but can also be found in areas surrounding the Great Lakes,
           the Virgin Islands, and Puerto Rico. From the Gulf of Maine to
           Padre Island, Texas, coastal barriers form an almost unbroken
           chain along the coastline. Coastal barriers are generally
           unsuitable for development because the movement of unstable
           sediments undermines man-made structures. Despite this threat,
           coastal areas that include coastal barriers are among the most
           rapidly growing and developed areas in the nation, accounting for
           53 percent of the total population in the United States according
           to a 2004 report by the National Oceanic and Atmospheric
           Administration (NOAA), National Ocean Service.

           In 1982, Congress enacted the Coastal Barrier Resources Act to
           minimize (1) the loss of human life; (2) wasteful expenditures of
           federal revenue; and (3) damage to fish, wildlife, and other
           natural resources associated with coastal barriers along the
           Atlantic and Gulf coasts by restricting future federal
           expenditures and financial assistance, which have the effect of
           encouraging development of coastal barriers. The act designated
           186 units, comprising about 453,000 acres along 666 miles of
           shoreline from Maine to Texas, which would later be known as the
           John H. Chafee Coastal Barrier Resources System (CBRS).

           Subsequently, the CBRS was further expanded to include additional
           units along coastal states from Maine to Texas, plus units in the
           Great Lakes, the Virgin Islands, and Puerto Rico. Currently, the
           CBRS includes 585 units, which consist of undeveloped coastal
           barrier lands and aquatic habitat that comprises nearly 1.3
           million acres of land and associated aquatic habitat. The CBRS was
           also expanded to include 272 OPAs that comprise an additional 1.8
           million acres of land and associated aquatic habitat. Most of the
           land in these OPAs is publicly held for conservation or
           recreational purposes, such as national wildlife refuges, national
           parks and seashores, and state and county parks; but some OPAs may
           also include some private property that may or may not be held for
           conservation.

           Under CBRA, no single federal agency has overall responsibility
           for administering activities within the CBRS; instead, all federal
           agencies must abide by the provisions of the act. CBRA does assign
           the Secretary of the Interior responsibility for, among other
           things, maintaining maps of each CBRS unit and recommending
           modifications to CBRS unit boundaries, as needed.^7 Within the
           Department of Interior, these responsibilities belong to the FWS.
           Both agencies and property owners can request decisions from FWS
           regarding whether specific properties are within CBRS boundaries.
           Finally, agencies must consult with FWS to determine whether a
           proposed project is within the CBRS, and if so, whether the
           project is consistent with CBRA.

           The Coastal Barrier Resources Reauthorization Act of 2000 directed
           the Secretary of the Interior to complete a Digital Mapping Pilot
           Project for at least 50 but not more than 75 units in the CBRS and
           submit a report to the Congress that describes the results of the
           pilot project and the feasibility, data needs, and costs of
           completing digital maps for the entire CBRS.^8 Currently, FWS is
           conducting a pilot project to create updated digital CBRS maps
           that would provide federal agencies and others with an enhanced
           tool for determining accurate boundary locations. Later, the
           Coastal Barrier Resources Reauthorization Act of 2005 directed the
           Secretary of the Interior to create digital maps by 2013 for all
           CBRS units not included in the pilot project. However, according
           to agency officials, the ability to conduct this project and the
           actual completion date will depend upon the specific funding that
           the agency receives for this project.

           CBRA does not prohibit development in CBRS units by owners who are
           willing to develop their properties without the benefit of federal
           financial assistance. Instead, with certain exceptions, CBRA
           prohibits federal expenditures or financial assistance within CBRS
           units that might encourage development. The prohibitions include,
           but are not limited to the following:

           o the construction or purchase of any structure, facility, or
           related infrastructure;
           o the construction or purchase of any road, airport, boat landing
           facility, or other facility on, or bridge or causeway to, any CBRS
           unit;
           o any project to prevent the erosion of, or to otherwise
           stabilize, any inlet, shoreline, or inshore area for the purpose
           of encouraging development; and
           o the issuance of flood insurance coverage under the National
           Flood Insurance Act of 1968 for any new construction or
           substantially improved property.

           CBRA allows certain federal assistance within the CBRS for limited
           activities after consultation with FWS. However, the act does not
           require the agencies to obtain FWS' approval before acting. Such
           assistance includes, but is not limited to the following:

           o the exploration, extraction, or transportation of energy
           resources that can be carried out only on, in, or adjacent to a
           coastal water area;
           o the maintenance or construction of improvements of existing
           Federal navigation channels and related structures;
           o the maintenance, replacement, reconstruction, or repair, but not
           the expansion, of publicly owned or operated roads, structures, or
           facilities that are essential links in a larger network or system;
           o military activities essential to national security; and
           o assistance for emergency operations essential to saving of lives
           and protecting property.

           CBRA has no provisions prohibiting the administration of federal
           regulatory activities, such as issuing certain permits, within the
           CBRS. Three federal agencies--the Corps, EPA, and the U.S. Coast
           Guard--issue permits that regulate, among other things, the
           discharge of dredged or fill material into federally regulated
           waters, including wetlands; the discharge of wastes into navigable
           waters; and the construction of bridges over navigable waters.
           Because much of the CBRS is comprised of wetlands and aquatic
           habitat, activities undertaken in these areas can require a permit
           from one or more of these agencies. Federal legislation other than
           CBRA provides the authority for issuing these permits. Among these
           are the Clean Water Act, the Rivers and Harbors Appropriation Act
           of 1899, and the Bridge Act of 1906, as amended.
			  
			  CBRS Remains Largely Undeveloped

           Despite the concentration of significant levels of development in
           a few units, most of the CBRS remains undeveloped. Specifically,
           we found an estimated 84 percent of all CBRS units remain
           undeveloped--with no new structures built since the unit was
           included in the CBRS. We found that factors such as the lack of
           suitably developable land in the unit and state laws discouraging
           development were responsible for inhibiting development. We also
           determined that an estimated 13 percent of CBRS units experienced
           minimal levels of development--consisting of less than 20
           additional structures per unit since becoming part of the
           CBRS--while 3 percent of CBRS units experienced significant
           development--100 or more additional structures per unit. According
           to local officials, commercial interest and public desire to build
           in some units and local government support for development were
           some of the key factors contributing to the development in the
           CBRS units we reviewed. Appendix II lists the units in our review
           and the status of development in those units.
			  
			  The Majority of CBRS Units Have Not Experienced Development

           On the basis of our analysis of a random sample of CBRS units, we
           estimate that 84 percent of the units experienced no new
           development since their inclusion in the CBRS.^9 For the units in
           our sample, the undeveloped units were generally smaller in total
           acreage and had less developable acreage than the developed units.

           Although CBRA does not appear to have been a primary factor in
           discouraging development in the units we reviewed, officials
           indicated that in those areas where CBRA prohibitions are
           complemented by local and state government objectives for
           development, it is unlikely that there will be significant
           increases in development. Local officials cited several factors as
           being primarily responsible for inhibiting development.

           The Lack of Suitably Developable Land. This was a primary factor
           for the lack of development in a number of CBRS units that we
           reviewed.^10 For example, the Boat Meadow unit in Massachusetts is
           comprised almost entirely of salt marshes with small sand bars
           scattered throughout shallow water, making the land unsuitable for
           development. Similarly, in the Wrightsville Beach unit in North
           Carolina, the sand continuously shifts, making the land too
           unstable for development. Figure 1 is an example of the type of
           terrain generally found in the Boat Meadow CBRS unit in
           Massachusetts.

           Figure 1: Boat Meadow CBRS Unit in Massachusetts

           Lack of Accessibility to the Unit. A number of federal and local
           officials noted that some CBRS units are not easily accessible or
           are located in remote locations that are not desirable to
           developers. For example, a number of units, such as the Bay Joe
           Wise Complex in Louisiana, are only accessible by boat. Other
           units, such as the Boca Chica unit in Texas, are in such remote
           locations that an official said developers are not willing to
           build there. In addition, several remote and inaccessible
           locations do not currently have the infrastructure needed to
           develop the unit. For example, an official said the lack of
           existing infrastructure and the high cost of constructing
           development-quality water and sewage infrastructure have
           discouraged development on the North Padre Island unit in Texas.

           State Laws Discouraging Development. State laws were cited by a
           number of officials as reasons why development had not occurred in
           some CBRS units. Some states have adopted specific restrictions to
           prevent development in coastal or wetland areas, which are often
           found in CBRS units. For example, a number of units in
           Massachusetts--such as Black Beach and Squaw Island--have not
           experienced development due in part to wetland and coastal
           protection laws enacted by the state.^11 In addition, both Maine
           and Massachusetts do not allow state funds or grants to be used
           for projects to encourage development in barrier beaches.^12 In
           Rhode Island, any coastal development project must receive a
           permit from the Rhode Island Coastal Resources Management Council,
           and an official explained that it was highly unlikely that permits
           would be issued for new development in coastal regions of the
           state.

           Preservation Efforts by Conservation Groups. A number of CBRS
           units include land owned by entities seeking to preserve the area
           in its natural state. In some cases, CBRS units have lands that
           are owned by federal, state, or local governments, such as local
           parks or national forests. For example, the Whitefish Point unit
           in Michigan is part of the Hiawatha National Forest. In other
           cases, land in CBRS units is owned by conservation groups seeking
           to prevent development. For example, a significant portion of the
           Southgate Ponds unit in the U.S. Virgin Islands is owned by the
           St. Croix Environmental Association; the Fox Islands unit in
           Virginia is owned by the Chesapeake Bay Foundation; and the Pine
           Island Bay unit in North Carolina is mostly owned by the National
           Audubon Society. Although these owners have sought to prevent
           development within the unit, as the land becomes more valuable,
           owners may experience pressure to sell it for development
           purposes. Private home owners have also taken actions to prevent
           continued development in one CBRS unit we reviewed. Some portions
           of the Prudence Island Complex unit in Rhode Island are located in
           private home owners' backyards. Home owners have voluntarily
           placed their land into a conservation easement to formally protect
           it from future development.
			  
			  A Small Percentage of Units Have Experienced Some Level of
			  Development, but Significant Development Has Been Concentrated
			  in a Few Units

           Although the majority of CBRS units remain undeveloped, 16 percent
           have experienced some level of development. While the range of
           development varies between one additional structure for some units
           to over 400 new structures for another unit, the amount of
           development in most of the units has been small. Thirteen percent
           of the units have added less than 20 structures. Where there has
           been significant development, it has been concentrated in a
           relatively small number of units. We estimate that only 3 percent
           of CBRS units have experienced the addition of 100 or more new
           structures since their inclusion in the CBRS.

           The majority of the CBRS units within our sample that have
           experienced development are located in the southern United States.
           Two units experiencing the most extensive development were the
           Topsail, North Carolina unit and the Cape San Blas, Florida unit.
           Several other units in the south, such as the Four Mile Village
           unit in Florida and Bird Key Complex in South Carolina, have plans
           for continued development. None of the units in our sample located
           in the northern United States had experienced such extensive
           development. One factor contributing to increased development in
           the south is the greater amount of developable acres; 80 percent
           of the developable land in the CBRS is located in southern
           units--those located south of New Jersey.

           Local officials cited several factors as being primarily
           responsible for the development that has occurred.^13

           Commercial Interest and Public Desire to Build in the Unit.
           Officials told us that development had occurred in several areas
           because the public's desire to develop in the unit was stronger
           than the disincentive of CBRA. For example, the Currituck Banks
           unit in North Carolina has experienced an increase of at least 400
           new residential homes since its inclusion in the CBRS. Although
           this unit only has beach access for four-wheel drive vehicles,
           approximately 75 percent of the land south of the unit is
           currently built to capacity, and the increasing demand for
           residential structures is sending developers into the adjoining
           CBRS unit. Local officials stated that the lack of federal
           assistance did not appear to have any affect on the rate of
           development in the area. Similarly, the Cape San Blas unit in
           Florida has continued to experience increased development with at
           least 900 new structures--primarily single family vacation
           homes--being built since the unit's inclusion in the CBRS.
           Officials in Cape San Blas believe that as other coastal locations
           around Florida became too expensive to find affordably priced
           ocean front homes, the area of Cape San Blas became a highly
           desirable location. Accounting for the significant development
           that has occurred in the Topsail unit in North Carolina, officials
           stated that the basic reason was simply supply and demand: people
           want to live on the coast of North Carolina, and the area that
           includes the CBRS unit had developable land available.

           Local Government Support for Development. Local officials
           explained that local governments with a pro-development attitude
           aided in increasing development in CBRS units. For example, local
           officials in Topsail, North Carolina told us that most of the
           1,600 structures located in the Topsail CBRS unit were constructed
           after the unit's inclusion in the CBRS.^14 These officials
           indicated that the county government had begun development plans
           for land within the unit prior to its inclusion in CBRS. These
           officials noted that the county had targeted the area for
           development to promote tourism and increase the local tax base,
           and that certain infrastructure was built to support this
           increased development. As the result of these pro-development
           policies, a large portion of the unit has been developed with
           residential homes--many of which serve as vacation rentals during
           the summer months. Similarly, in the Cape San Blas unit in Florida
           the local government had development plans for the area prior to
           the adoption of CBRA. Local officials there said that the area was
           already subdivided into lots for development and that some
           existing infrastructure, such as roads, water systems, and
           telephone systems, was already built when the unit was added to
           the CBRS.

           Availability of Affordable Private Flood Insurance. Officials
           familiar with several CBRS units told us that initially
           restrictions on the availability of federal flood insurance had
           little impact on the development that occurred in some CBRS units.
           Lenders did not require flood insurance in order for home owners
           to obtain mortgage loans at the time most of the development
           occurred. According to these officials, home owners within CBRS
           units that chose to get flood insurance could readily get private
           flood insurance at rates comparable with federal flood insurance.
           However, in the past few years FEMA has updated its flood-zone
           maps and has designated some CBRS areas as special flood hazard
           areas. This change in designation has made areas that once did not
           require owners to obtain flood insurance in order to receive
           financing into areas where owners are now required to have flood
           insurance prior to obtaining mortgage loans. At the same time,
           officials said that in several CBRS units the cost of private
           insurance has skyrocketed and is no longer comparable to national
           flood insurance program rates. According to a local banker in Cape
           San Blas, a $250,000 home outside the CBRS unit can obtain flood
           insurance through the National Flood Insurance Program for $470
           per year, but private flood insurance for homes located in the
           CBRS unit that are not eligible for national flood insurance could
           cost between $5,070 and $12,500 a year, depending on the insurance
           company.

           The new requirements mandating flood insurance for mortgages in
           some units and the increased costs of private flood insurance may
           begin to impact development in the CBRS in the future, according
           to local officials. For example, officials in Currituck County
           noted that the flood zone determination change had significantly
           reduced the number of building permits issued for new development
           in the CBRS unit since 2005 and suggested that the unit will now
           experience less future development. Likewise, the Cape San Blas
           unit in Florida has also been affected by the flood zone
           determination change. A local official stated that since FEMA
           adopted a special flood hazard area for the CBRS unit in 2002,
           property values in the unit have decreased by 30 percent. Because
           the cost of private flood insurance has risen dramatically in the
           last couple of years, a number of residents and officials
           representing areas within the CBRS, including Cape San Blas and
           Topsail, have unsuccessfully attempted to remove the areas from
           the CBRS, primarily so that residents would be eligible to obtain
           flood insurance through the National Flood Insurance Program.

           Our review of CBRS units did not include OPAs because FWS
           officials informed us that these areas were classified separately
           from system units and that the land was already protected from
           development by other mechanisms--such as its designation as a
           state or federal park. OPAs are not under the same limitations as
           CBRS units; the only restriction placed on federal spending within
           these areas is the prohibition on federal flood insurance.
           However, we found instances where land within OPAs was sold to
           private developers and development had increased in the area. For
           example, in the St. Andrews Complex unit in Florida, the Bahia de
           Tallaboa unit in Puerto Rico, and the Mustang Island unit in
           Texas, development has continued despite the units' designation as
           an OPA.
			  
			  The Extent to Which Federal Agencies Have Provided Financial
			  Assistance and Permits to Entities in CBRS Units Varies

           We found that federal agencies have provided some financial
           assistance prohibited by CBRA, some assistance allowed by CBRA,
           and hundreds of permits for federally regulated construction
           projects to entities within the CBRS units included in our review.
           Four agencies provided financial assistance expressly prohibited
           by CBRA to property owners in CBRS units. Three federal agencies
           also provided financial assistance to entities in CBRS units that
           is allowed under CBRA, but they do not track the amount of
           assistance they provided. As a result, we were unable to determine
           the total extent of such assistance. Finally, the Corps and
           EPA-authorized state agencies have issued hundreds of permits for
           a variety of federally regulated construction projects within CBRS
           units.
			  
			    Four Federal Agencies Have Provided Some Financial Assistance
			    That Is Prohibited by CBRA

           Four federal agencies--FEMA, HUD, SBA, and VA--provided some
           financial assistance that is expressly prohibited by CBRA to
           property owners in CBRS units. Our review of approximately 4,500
           addresses uncovered 73 active FEMA flood insurance policies, 37
           inappropriate FEMA disaster assistance payments, 5 HUD home loan
           guarantees, 3 SBA disaster loans, and 11 VA home loan guarantees
           that should not have been made to property owners in CBRS units.
           Although three of the four agencies have procedures to prevent and
           detect assistance to property owners in CBRS units, agency
           officials cited several reasons why this erroneous assistance was
           provided in violation of CBRA, including the lack of updated CBRS
           maps, which makes determining the precise locations of properties
           and CBRS unit boundaries difficult.
			  
			    FEMA National Flood Insurance Program

           FEMA provides federally backed flood insurance for home owners,
           renters, and business owners in participating communities that are
           not in the CBRS. Structures that are built or substantially
           improved following their inclusion within the CBRS are not
           eligible for federal flood insurance. However, our review of
           policies active as of May 2006 identified 73 National Flood
           Insurance Program (NFIP) policies for properties in CBRS units.
           The flood insurance policies ranged from $26,500 to $350,000 and
           totaled approximately $20 million. Although these policies
           violated the CBRA, FEMA officials said it is unlikely that the
           agency would actually pay a claim on these policies, because
           before paying a claim, FEMA adjusters would first conduct a
           physical inspection of the property and determine whether it was
           in a CBRS unit. If a property was found to be within the CBRS,
           FEMA would deny the claim and refund the policy owner's insurance
           premium.

           To prevent flood insurance policies from being issued for
           properties in CBRS units, FEMA's Flood Insurance Manual requires
           that private insurance companies participating in the NFIP
           determine if a property is eligible for flood insurance. Prior to
           issuing a policy, the agent is required to review FEMA's flood
           insurance maps to determine if the property is located within the
           CBRS and collect information to determine if the structure was
           built prior to the unit's inclusion in the CBRS. However,
           according to FEMA, insurance agents have made mistakes and issued
           policies in violation of CBRA for two reasons:

           o It may be difficult to locate a property and determine whether
           it is in a CBRS unit, especially when a property is near or
           adjacent to a CBRS boundary. For example, at one location we
           visited, we identified homes adjacent to each other where one
           property was in the CBRS and the other was not. In other CBRS
           units, some homes had backyards that fell within the CBRS.
           Furthermore, new streets may not be depicted on existing maps.
           According to FEMA officials, the insurance agent must often make a
           judgment call when determining whether a property is within the
           CBRS.
           o The agent may not be familiar with CBRA prohibitions and may not
           follow procedures. According to FEMA officials and officials from
           a private insurance agency with whom we spoke, some home owners
           obtain flood insurance from insurance agents located inland, away
           from coastal areas, who might not have been aware of the CBRA
           restrictions.

           According to FEMA officials, the agency takes a number of steps to
           identify properties that may have inappropriately received federal
           flood insurance. Since 1998, FEMA has sought to assist private
           companies with identifying flood insurance policies that
           potentially were ineligible for flood insurance coverage because
           the property was within the CBRS. To accomplish this task, FEMA
           uses computer mapping technology to plot addresses and determine
           whether they are potentially in a CBRS unit.^15 However, the
           computer software FEMA relies on cannot always correctly locate
           all addresses on the map. For example, this can occur if a street
           or address range is not included in the software, which can happen
           when a street or a range of addresses is new. Twenty of the 73
           flood insurance policies that we determined were issued for a
           property that was in a CBRS unit could not be located on a map by
           FEMA's computer software. In addition, computer mapping technology
           has inherent inaccuracies and may plot properties in the wrong
           location. For example, using our mapping software, we determined
           another 20 of the 73 flood insurance policies were for a property
           in the CBRS but were not identified as being in a CBRS unit by
           FEMA's mapping software.^16 FEMA officials said they recognize
           that their software may not always identify new addresses and
           streets in CBRS units, and so the agency obtains quarterly updates
           of new streets and addresses and rechecks insured properties
           against the updated information to identify any that might be
           located in CBRS units.

           When FEMA's computer plotting reveals that a property for which a
           federal flood insurance policy has been issued may be in a CBRS
           unit, FEMA reports the error to the insurance company. Once an
           insurance company receives notification in the form of an error
           message that they may have written an ineligible policy, the
           company may take one of four actions:

                        1. The company can agree that the property is located
                        in a CBRS unit and cancel the policy back to the
                        inception date of coverage.
                        2. The company may agree that the property is located
                        in a CBRS unit but prove that the building was
                        constructed prior to the CBRS designation. In these
                        cases, the policy is deemed valid and may remain in
                        effect.
                        3. The company can disagree that the property is
                        located in a CBRS unit and assume responsibility for
                        the risk. In these cases, the policy would remain
                        active, FEMA would continue to collect the premiums,
                        but the insurance company would be responsible for
                        paying any claims filed. Insurance companies have
                        assumed liability for the risks associated with 29 of
                        the 73 flood insurance policies that we identified
                        had been issued for properties located in CBRS units.
                        4. The company can request that FWS make an official
                        determination regarding whether the property is in
                        the CBRS. If FWS determines that the property is in a
                        CBRS unit, the policy is then cancelled back to the
                        inception date of coverage. However, FEMA officials
                        expressed concern about the length of time FWS takes
                        to make a property determination. Typically, it takes
                        FWS a year to respond to inquiries for a property
                        determination. As of January 17, 2007, FEMA was
                        waiting for determinations on 544 addresses from FWS.

           According to FWS officials, the process for making property
           determinations is labor intensive because they are using CBRS maps
           that were created more than 15 years ago and are not available in
           digital format. FWS officials told us that modernized digital maps
           of the CBRS would improve the accuracy and efficiency of the
           property determination process, allowing its customers and
           partners, in many cases, to determine within minutes whether a
           property is located within the CBRS. In 2000, the Congress
           directed the Secretary of the Interior to create draft digital
           maps for at least 50 and not more than 75 units, or nearly 10
           percent of the CBRS.^17 FWS has created draft digital maps of 60
           CBRS units that it must submit to the Congress for its
           consideration.^18 In May 2006, the Congress also instructed the
           Secretary of the Interior to create maps for the rest of the CBRS
           by May 2013.^19 According to FWS, digital maps would replace the
           paper maps currently being used that are (1) outdated
           technologically and (2) sometimes inaccurate and may not align
           precisely with the natural or man-made features that the Congress
           intended the boundaries to follow. FWS officials believe that
           modernizing the CBRS maps will address the inaccuracies of the
           existing maps.

           To implement the map modernization project, FWS officials said
           that they investigated several options for procuring data to
           produce the required draft digital maps, including federal, state,
           local, and private sources. In many cases, FWS was able to obtain
           data internally or from other federal agencies at little or no
           cost, including wetlands data and national wildlife refuge
           boundaries from within FWS, aerial imagery from the U.S.
           Geological Survey, hydric soils data from the Department of
           Agriculture's Natural Resources Conservation Service, and digital
           boundaries for many federally protected areas from NOAA.

           FEMA is also conducting a map modernization effort that includes
           preparing digital flood insurance maps. In 2006, FWS entered into
           an interagency agreement with FEMA whereby FWS will place current
           CBRS boundaries onto FEMA's digital flood maps. FEMA provided FWS
           with $40,000 for an initial set of maps for some units. While the
           FEMA maps are not the "official" CBRS maps adopted by the
           Congress, FWS officials said that these digital maps will allow
           property owners, insurance agents, and others to have a much more
           accurate and precise tool for determining whether a property or
           project site is located near a CBRS area and would require an
           official determination from FWS.
			  
			    FEMA Individuals and Households Program

           FEMA's Individuals and Households Program (IHP)^20 provides
           housing assistance and other assistance, such as medical or
           funeral assistance, for needs arising from a declared emergency or
           major disaster. For owners or renters residing in CBRS units, FEMA
           regulations allow providing temporary housing assistance (rent)
           but generally do not allow providing funds for housing repairs or
           construction assistance. However, we found that since August 26,
           1998, FEMA provided 37 disaster assistance payments to individuals
           in CBRS units included in our review totaling $25,393. Most of the
           payments were for purposes labeled by FEMA as "Other Eligible
           Property Items." According to FEMA officials, "Other Eligible
           Property Item" payments were for post-disaster purchases for
           emergency needs such as chainsaws, generators, heating fuel,
           dehumidifiers, air purifiers, and wet/dry vacuums.^21 These
           payments were made under six different disaster declarations, all
           to individuals living in CBRS units in North Carolina and Florida.
           The units included Coconut Point, Cape San Blas, Blue Hole, Ponce
           Inlet, and Ormond-by-the-Sea in Florida, and Currituck Banks and
           Topsail in North Carolina. In addition to payments for "Other
           Eligible Property Items," one payment of $645.95 was made for home
           repairs. FEMA procedures require officials making payment
           determinations in potential CBRS areas to document that the
           property is not in a CBRS unit prior to approving assistance for
           those types of assistance not allowed in such areas. However,
           according to a FEMA official, in these cases the procedures were
           not followed when these payments were approved.^22
			  
			    Department of Housing and Urban Development

           Through its Mortgage Insurance Homes program, HUD insures lenders
           against losses on mortgage loans used to finance the purchase of
           proposed, under construction, or existing housing, as well as to
           refinance indebtedness on existing housing as long as these
           properties are not located in the CBRS. In our review of insured
           home loans active as of June 2006, we identified five HUD-insured
           loans for properties located in CBRS units. Three of the loans
           were for properties in the Prudence Island Complex unit in Rhode
           Island; one in the Topsail unit in North Carolina; and one in the
           Cape San Blas unit in Florida. These insured loans were approved
           by HUD between 1985 and 2000, with loan amounts ranging from
           approximately $50,000 to $137,000, for a total of about $384,000.

           Despite the fact that all of HUD's programs are subject to CBRA
           restrictions, HUD officials said that they have no procedure under
           their single family (one- to four-family property) mortgage
           insurance programs related to CBRA. HUD officials further
           indicated that while they could implement better controls for
           restrictions on providing single family mortgage insurance in the
           CBRS, it would be unnecessary in practical terms. HUD officials
           provided three primary reasons why it was unlikely that a
           HUD-insured loan would be provided for a property in a coastal
           area. First, HUD regulations require that flood insurance be
           obtained under the NFIP before HUD will insure single family
           mortgages for properties in FEMA-identified special flood hazard
           areas. HUD officials stated that because properties located in the
           CBRS would likely be in special flood hazard areas and the NFIP
           flood insurance is prohibited in the CBRS, HUD would not be able
           to insure single family mortgages for these properties. However,
           HUD's explanation does not account for the fact that portions of
           CBRS units may not be in a special flood hazard area and that FEMA
           prohibitions are not universal as the NFIP flood insurance may be
           available to homes built before the area's inclusion in the CBRS.
           Second, most HUD insurance for single family mortgages is for
           first-time home owners who typically are not buying homes in the
           higher priced ranges found in the CBRS. Third, property values in
           the CBRS are such that mortgage amounts would likely exceed the
           program limits for typical HUD-insured single family mortgages, as
           the mortgage limit for a one family property ranges from
           approximately $170,000 to $310,000, depending on the location. In
           response to our findings, HUD officials said that the department
           would be developing CBRA policy guidance and associated training
           to ensure future compliance.
			  
			    Small Business Administration

           Following the issuance of a disaster declaration, SBA provides
           disaster loans to eligible home owners for repair or replacement
           of their primary residences. However, residences located in CBRS
           units are ineligible for this disaster loan assistance. During our
           review of the period January 1, 1990, through May 30, 2006, we
           found that SBA had made three disaster loans for home repairs for
           properties in CBRS units.^23 The three loans ranged from $5,000 to
           $10,000 and totaled $24,200. These loans have been paid in full
           and were made to individuals in the Florida CBRS units of Blue
           Hole and Cape San Blas, and the Creek Beach unit in New York. To
           prevent disaster loans from being provided to properties within
           the CBRS, SBA procedures call for agency staff to consult FEMA's
           flood maps to determine whether a property is within a CBRS unit
           before approving disaster loans. SBA officials acknowledge that
           two of these loans should not have been approved, but did not
           agree that the third loan was for a property within CBRS. These
           officials stated that it is sometimes difficult for agency staff
           to determine if a property is within the CBRS with the existing
           FEMA flood maps. SBA officials said that as a result of our review
           the agency will increase the number of quality assurance reviews
           conducted in any disaster area that includes a CBRS unit.
			  
			    Department of Veterans Affairs

           VA issues home loan guarantees to help eligible recipients obtain
           homes or refinance home loans except in CBRS units. However, our
           review of home loan guarantees active as of September 2006 found
           that VA had provided 11 loan guarantees for homes in a CBRS unit.
           Nine of these 11 loan guarantees were issued to home owners in the
           Topsail unit in North Carolina, while the other two were provided
           to home owners in the Ormond-by-the-Sea unit in Florida. The
           amount of the 11 loan guarantees ranged from a low of about
           $14,340 to a high of about $45,900 for a total value of $352,188.

           VA officials told us that the agency's Lenders Handbook includes
           provisions that inform readers that properties in CBRS units are
           ineligible as security for a VA-guaranteed loan. VA appraisers are
           instructed during training sessions to reject assignments
           appraising such properties. Also, to verify that loan guarantees
           are provided lawfully, agency officials said that they or their
           designees (1) examine appraisal paperwork for all loan
           applications looking for anomalies; (2) inspect 10 percent of all
           loan applicant properties to verify, among other things, that they
           are not in CBRS units; (3) review paperwork for 10 percent of all
           closed loans; and (4) visit lender offices and sample VA loans for
           compliance. In reviewing the provisions included in VA's handbook,
           we determined that it inaccurately instructs appraisers to obtain
           the maps for determining the location of a property from the U.S.
           Geological Survey rather than from FWS.

           VA officials acknowledge that agency staff should have identified
           the 11 properties we discovered as located within the CBRS during
           their initial review of the appraisal paperwork. VA officials
           explained that as a result of our findings, they have (1)
           corrected the Lenders Handbook provisions to instruct staff to use
           maps maintained by FWS and (2) instructed officials at VA regional
           loan centers to modify their training to both lenders and
           appraisers to emphasize the procedures designed to prevent issuing
           loans to persons who reside in CBRS units.
			  
			  Federal Agencies Have Provided Assistance That Is Allowable under
			  CBRA, but the Extent of Such Assistance Is Unknown

           We found that three federal agencies had provided financial
           assistance allowable under CBRA to entities within the CBRS. We
           were unable to determine the total extent of such assistance,
           because these federal agencies do not track the amount of
           allowable financial assistance they provide to entities in CBRS
           units, and they could not provide us with the data necessary to
           estimate the total assistance provided.
			  
			    Federal Emergency Management Agency

           After a disaster, FEMA may provide disaster funding in CBRS units
           for emergency assistance such as debris removal and emergency
           protection measures. FEMA may also provide disaster funding
           following an emergency for activities like repairing roads or
           utilities, repairing existing water channels, or disposing of
           sand. Because FEMA could not provide reliable data on whether this
           disaster assistance was within a CBRS unit for each project, we
           could not determine the full extent of the allowable disaster
           assistance provided by FEMA. However, with FEMA's data, we were
           able to identify that some of the projects were within CBRS units.
           For example, since 1998, FEMA provided at least $5.6 million in
           disaster assistance to the Topsail unit in North Carolina to fund
           projects to remove debris, replace signs, and repair beach access
           crosswalks and public beach facilities after Hurricanes Ophelia,
           Floyd, Irene, and Isabel. Similarly, in both the Cape San Blas,
           Florida and Topsail, North Carolina CBRS units, FEMA provided
           funds to construct an emergency berm in order to protect existing
           development after storms destroyed protective dunes and caused
           beach erosion. Table 1 provides examples of some of the disaster
           assistance FEMA has provided to CBRS units since 1998.
			  
^7Aside from minor exceptions, only Congress, through new legislation, can
modify the boundaries of the CBRS. To determine whether the revisions
constitute appropriate technical corrections, FWS conducts objective
reviews to examine whether or not the area was undeveloped when it was
included in the CBRS and whether or not the boundaries on the map
correctly follow the natural or man-made features they were intended to
follow on the ground. When technical mapping errors are found, FWS has
supported legislation to modify boundaries accordingly. Since the CBRS was
designated in 1982, Congress has enacted technical correction legislation
to revise the boundaries of 42 CBRS units.

^8FWS anticipates the draft maps and report will be submitted to the
Congress in 2007.

^9The random probability sample included 91 geographically dispersed CBRS
units. All percentage estimates from the sample have margins of error of
plus or minus 10 percentage points, unless otherwise noted.

^10Developable land is the number of fastland acres in each unit. Fastland
is situated above the mean high-tide line and is generally not wetlands.
FWS determined the fastland acres for each unit within the CBRS.

^11According to Massachusetts state officials, the Wetlands Protection Act
regulations established a "no net loss of wetlands" policy for all coastal
areas and barrier beaches. Under the Massachusetts Coastal Wetlands
Restriction Act, the Massachusetts Commissioner of Environmental
Protection can regulate and prohibit dredging, filling, or otherwise
altering coastal wetlands.

^12In 1980, Massachusetts Governor Edward J. King issued Executive Order
No. 181 preventing the use of state funds and grants for construction
projects to encourage growth and development in hazard prone barrier
beaches. See also Me. Rev. Stat. Ann. tit. 38, SS 1901-1905.

^13To determine the reasons development occurred, we interviewed local
officials in a number of developed units in our sample as well as
officials for the Cape San Blas unit in Florida and the Topsail unit in
North Carolina.

^14The date structures were built in the Topsail unit was not readily
available when we conducted this analysis, so we could not determine the
exact number of structures built since the unit's inclusion in the CBRS.

^15According to FEMA officials, FEMA does this plotting for all properties
in a community where a CBRS unit is located. Every month FEMA plots
addresses of new policies or policies that have changed. All addresses in
a community with a CBRS unit are reviewed at least once a year.

^16FEMA uses MapInfo software with MapMarker to plot locations. This
software is updated more frequently than the software that we use. In
these 20 instances, our software located properties within the CBRS
boundary, but FEMA's software did not. However, we physically verified
that 14 of these 20 properties appeared to be within CBRS boundaries
during a site visit to the unit. We did not visit the locations where the
remaining 6 properties were located.

^17The Coastal Barrier Resources Reauthorization Act of 2000, Pub. L. No.
106-514, S6, 114 Stat. 2394, 2396, required FWS to prepare draft digital
maps for a portion of the CBRS.

^18The Coastal Barrier Resources Act of 2005 directs the Secretary of the
Interior to finalize the pilot project maps by conducting a public review
of the draft maps, making adjustments as necessary, and presenting final
recommended maps to the Congress its consideration. At that point, the
Congress could adopt the pilot project maps as the official CBRS maps
through legislation.

^19The Coastal Barrier Resources Reauthorization Act of 2005, Pub. L. No.
109-226 S 4, 120 Stat. 381, 382 (2006).

^20Our study also includes data from disasters that predate IHP, from its
predecessor program called "Disaster Housing/Individual and Family Grant
Program."

^21CBRA exempts from its general prohibition assistance for emergency
actions essential to saving lives and the protection of property and the
public health, as performed under particular sections of the Robert T.
Stafford Disaster Relief and Emergency Assistance Act, as amended. 16
U.S.C. S 3505(a)(6)(E). In its regulations, FEMA describes these actions
to include, among other things, removing debris and repairing primary
residences to make them habitable. However, for the expenditures described
above as "Other Eligible Property Items," such as chainsaws and
generators, FEMA officials said those payments were prohibited.

^22We issued a report on the challenges that the IHP program experienced
during Hurricanes Katrina and Rita and recommended that FEMA address the
potential for fraud and abuse identified in the program. GAO, Hurricanes
Katrina and Rita: Unprecedented Challenges Exposed the Individuals and
Households Program to Fraud and Abuse; Actions Needed to Reduce Such
Problems in Future, [57]GAO-06-1013 (Washington, D.C.: Sept. 27, 2006).

^23SBA approved seven loans in CBRS units, however, individuals did not
initiate four of these loans and they were cancelled.

           Table 1: Examples of FEMA Disaster Assistance Since 1998
			                                                    
			                                                         Total
Storm and year Unit                 Project description          obligated 
Floyd and      Topsail Beach,       Replace traffic control        $13,979 
Irene, 1999    North Carolina       signage                                
Floyd and      Topsail Beach,       Debris removal               1,304,417 
Irene, 1999    North Carolina                                              
Charley and    Ormond-by-the Sea,   Restore an electrical           11,361 
Bonnie, 2004   Florida              substation                             
Ivan, 2004     Cape San Blas,       Construct an emergency berm  1,423,766 
                  Florida                                                     
Frances, 2004  Ponce Inlet,         Restore Turtle                  23,666 
                  Florida              Rehabilitation Laboratory              
                                       at the Marine Science                  
                                       Center                                 
Dennis, 2005   Dog Island, Florida  Repair damaged road             37,372 
                                       surfaces                               
Dennis, 2005   Dog Island, Florida  Debris removal                 470,833 
Ophelia, 2005  Topsail Beach,       Construct emergency berms   $1,167,146 
                  North Carolina                                              

           Source: GAO analysis of FEMA data.

           As mentioned earlier, FEMA is also allowed to provide limited
           disaster assistance to individuals through the IHP after the
           President declares an emergency or major disaster in an area,
           including CBRS units. We found that since August 26, 1998, FEMA
           provided $8,237 to 16 individuals in CBRS units for emergency
           rental assistance. These payments were made to individuals in CBRS
           units in Florida and North Carolina.
			  	
			    Federal Highway Administration

           An exception to the limitations within CBRA allows FHWA to
           administer federal funding for projects on publicly owned or
           operated roads that are essential links in a larger transportation
           network and do not expand the existing transportation system.
           Because, as stated in agency guidance, FHWA determined that all
           roads within the federal highway system, including those in CBRS
           units, are usually "essential links" in a larger transportation
           network, most projects within CBRS units are permissible under
           CBRA after a consultation process with FWS. Although FHWA does not
           maintain data on which projects were located within CBRS units, we
           were able to identify--based on information provided by state
           officials--some examples of allowable projects in CBRS units that
           received federal funds from FHWA. For example, according to data
           from the Florida Department of Transportation, federal funding
           totaling approximately $1.1 million was provided to repair a road
           in the Cape San Blas unit after each of three hurricanes--Opal,
			  
			    Corps of Engineers
				 
           Earl, and Ivan.

           An exception to the limitations within CBRA allows the Corps to
           provide assistance in CBRS units after consultation with FWS as
           part of its mission to maintain and improve existing navigation
           channels. We found that since 1983, the Corps performed at least
           24 such projects in CBRS units, and most were to dredge channels.
           Many of these projects occurred along the Atlantic Intracoastal
           Waterway or in channels connecting this waterway to the Atlantic
           Ocean. Of the 24 projects, two-thirds occurred in CBRS units in
           South Carolina while the others were located in North Carolina,
           Florida, and Massachusetts. However, it is difficult to calculate
           the value of the Corps' assistance to CBRS units because nearly
           all of the Corps' projects involve activities both inside and
           outside CBRS units, and the Corps does not breakout project costs
           based on CBRS boundaries.
			  
			  EPA-Authorized State Agencies and the Corps Have Issued Permits
			  for Federally Regulated Construction Projects in CBRS Units

           EPA-authorized state agencies and the Corps have issued permits to
           property owners and entities within CBRS units for a number of
           different projects.^24 Since 1983, EPA-authorized state agencies
           issued at least 41 permits to property owners and entities in nine
           different CBRS units. All of the permits were associated with the
           National Pollutant Discharge Elimination System (NPDES), primarily
           to allow storm water discharges from construction sites or for
           discharges from water or wastewater treatment systems. Florida, as
           an EPA-authorized permitting state, issued 38 of the 41 permits.
           Of the remaining three permits, two were issued by New York and
           one by the U.S. Virgin Islands, both of which are authorized by
           EPA to issue NPDES permits.

           The Corps was unable to provide a complete list of all the permits
           it had issued since CBRA was enacted. However, we have determined
           that since 1983, the Corps issued at least 194 permits in 20
           different CBRS units for purposes such as erosion control,
           constructing piers and mosquito control ditches, filling wetlands,
           and raising fish and shellfish. Of these 194 permits:

           o Eighty-three were authorized under Section 10 of the Rivers and
           Harbors Appropriation Act of 1899. The act gives the Corps
           authority to issue permits to construct piers or marinas in
           navigable waters.
           o Eighty-seven were authorized under Section 404 of the Clean
           Water Act. Section 404 provides the Corps with the authority to
           issue or deny permits for discharges of dredged or fill material
           into waters under federal jurisdiction, including wetlands.
           o Twenty-four involved activities covered by both Section 10 of
           the Rivers and Harbors Appropriation Act and Section 404 of the
           Clean Water Act.

           Almost two-thirds of these permits were issued to property owners
           and entities in CBRS units in Florida; the remaining permits were
           issued to entities in units in the Carolinas and New England.
			  
			  Conclusions

           Although CBRA has limited the amount of federal financial
           assistance provided to some CBRS units, it does not appear to have
           been a major factor in discouraging development in those CBRS
           units that have developable land, local government and public
           support for development, and access to affordable private flood
           insurance. Despite CBRA's prohibitions on federal assistance to
           units in the CBRS, four federal agencies--FEMA, HUD, SBA, and
           VA--have provided such assistance. While the amount of assistance
           provided in violation of CBRA is not large, it does raise concerns
           about the ability of federal agencies to fully comply with the
           requirements of the act. Unless federal agencies follow the
           procedures they have established to prevent the provision of
           prohibited assistance and have access to up-to-date and reliable
           maps to ensure that accurate determinations are made for
           properties located in CBRS units, it is likely that some
           violations of CBRA may continue to occur.
			  
			  Recommendations for Executive Action

           In light of the federal financial assistance that was provided in
           violation of CBRA, we are recommending that the Secretaries of
           DHS, HUD, and VA, and the Administrator of SBA direct their
           agencies to (1) obtain official determinations from the FWS on
           whether the properties we identified as receiving federal
           assistance in violation of CBRA are in fact located within a CBRS
           unit and if they are, cancel all inappropriate loan guarantees and
           insurance policies that have been made to the owners of these
           properties and (2) examine their policies and procedures to ensure
           that they are adequate to prevent federal assistance that is
           prohibited by CBRA from being provided to entities in CBRS units.

           In addition, given the importance of digital maps to making
           accurate CBRS determinations, we are recommending that the
           Secretary of the Interior direct FWS to place a high priority on
           completing its efforts to develop digital maps that more
           accurately depict unit boundaries.
			  
			  Agency Comments and Our Evaluation

           We provided a draft of this report to the Department of Defense,
           DHS, DOI, HUD, SBA, and VA. We received comments via e-mail from
           the Department of Defense, DHS, and SBA, and we received written
           comments from the DOI, HUD, and VA.

           The Department of Defense and the SBA stated that they had no
           comments on the draft report, and DHS provided only technical
           comments and stated that it concurred with the report's
           recommendations. In its written comments, DOI stated that it
           supports efforts to improve CBRS property determinations and
           ensure compliance with CBRA. DOI also indicated that it will
           consider our recommendation concerning prioritization of the
           completion of digital maps as it develops future budget requests.
           In its written comments, HUD stated that the loan guarantees in
           question have already been terminated. HUD also noted that it is
           now developing policy guidance and associated training to ensure
           that no future violations of CBRA occur. In its written comments,
           VA stated that it agreed with our findings and one of our
           recommendations but did not agree with our recommendation to
           cancel the inappropriate loan guarantees that it had made in
           violation of CBRA. VA stated that it did not believe that the
           small number of loan guarantees that we found indicated a pattern
           of abuse of CBRA and that canceling these guarantees would inflict
           a disproportionate harm on lenders and veterans who were not
           responsible for the erroneous property determinations that the
           loan guarantees were based on. While we understand VA's concerns
           for the adverse impacts that could affect the parties involved, we
           believe that because these loan guarantees violate CBRA they
           should be rescinded.
			  
^24In most cases, permits to regulate point sources that discharge
pollutants into waters of the United States are issued by EPA-authorized
states rather than by EPA itself.

           We have also incorporated the technical comments provided by DHS
           and DOI, as appropriate, throughout this report. HUD's written
           comments are presented in appendix V, DOI's written comments are
           presented in appendix VI, and VA's written comments are presented
           in appendix VII.

           We are sending copies of this report to interested congressional
           committees as well as the Administrator, Small Business
           Administration; the Commander, U.S. Army Corps of Engineers; and
           the Secretaries of the Army, Defense, Homeland Security; Housing
           and Urban Development, Interior, and Veterans Affairs. 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 .

           If you have any questions about this report, please contact me at
           (202) 512-3841 or [email protected] . Contact points for our
           Offices of Congressional Relations and Public Affairs may be found
           on the last page of this report. GAO staff who made major
           contributions to this report are listed in appendix V.

           Sincerely yours,

           Anu K. Mittal
			  Director, Natural Resources and Environment
			  
			  Appendix I: Objectives, Scope, and Methodology

           We were asked to address issues related to the Coastal Barrier
           Resources Act, as amended, (CBRA) by reviewing development that
           has occurred and federal funding that has been provided within the
           John H. Chafee Coastal Barrier Resources System (CBRS).
           Specifically, we were asked to determine (1) the extent of
           development within the CBRS and (2) the extent of federal
           assistance provided to CBRS units.
			  
			  Determining the Extent of Development in CBRS Units

           To determine the extent of development in the system, we
           determined the number of structures within each unit. We
           accomplished the task by electronically mapping addresses with
           MapInfo and layering electronic boundaries of CBRS units from the
           Federal Emergency Management Agency's (FEMA) Q3 Digital Flood
           Insurance Rate Map data product with the mapped addresses. FEMA's
           Q3 data provides the external boundaries for CBRS units, though it
           is not an exact replica of the boundaries. Our results are
           representative of the extent of development within the CBRS.

           We focused our review on a stratified random sample of 91 units
           drawn from the 584 total units in the system, excluding otherwise
           protected areas.^1 The sample was drawn so that the results from
           the sample would have a precision margin of about plus or minus 10
           percentage points at the 95 percent confidence interval. We were
           able to collect and analyze data for 84 of the 91 CBRS units,
           representing a weighted response rate of 92 percent.^2 Of the 84
           units, 42 units are located in the north and 42 units are located
           in the south. Northern units include those located in Connecticut,
           Maine, Massachusetts, Michigan, New Jersey, New York, and Rhode
           Island. Southern units are those located in Alabama, Florida,
           Louisiana, Maryland, Mississippi, North Carolina, South Carolina,
           Virginia, Texas, Puerto Rico, and the Virgin Islands. As a result
           of the high response rate, we reweighted the sample to represent
           the entire population of units.

           Because we followed a probability procedure based on random
           selections, our sample is only one of a large number of samples
           that we might have drawn. Since each sample could have provided
           different estimates, we express our confidence in the precision of
           our particular sample's results as a 95 percent confidence
           interval. This is the interval that would contain the actual
           population value for 95 percent of the samples we could have
           drawn. As a result, we are 95 percent confident that each of the
           confidence intervals in this report will include the true values
           in the study population. All percentage estimates from the sample
           have margins of error of plus or minus 10 percentages points or
           less.

           To identify the number of structures within the CBRS units in our
           sample, we obtained address or parcel data from local government
           offices--including tax assessor's offices and on-line databases,
           geographic information system departments, and information
           technology departments. The exact dates for the parcel and address
           datasets vary by location--however, we requested the most recent
           available data. We also collected year-built data, value, and type
           of structure when available. After determining whether the
           structure was within the CBRS unit, we reviewed the year-built
           data to determine how many structures were built since the unit's
           inclusion in the CBRS. We did not independently assess the
           reliability of each address dataset provided by the local
           governments. However, for a number of address datasets we assessed
           the reliability of the data through interviews with knowledgeable
           local officials and verification of the addresses in the dataset
           by visual inspection during site visits.

           The electronic mapping was performed using roads and highways data
           provided by MapInfo's 2002 StreetSmart program. As a result, our
           analysis would not be able to map structures located on a street
           not included in the 2003 roads and highways dataset. Once the
           addresses were mapped, they were layered in MapInfo with FEMA's Q3
           data. On the basis of conversations with FEMA and FWS officials,
           we believe these data are sufficiently reliable for the purposes
           of this study. Since the FEMA Q3 data CBRS boundaries may not be
           precise, the results of our analysis could incorrectly reflect
           whether a structure is within a CBRS unit. As with any electronic
           mapping technology, accuracy issues are inherent and may impact
           reliability of the results.

           We conducted site visits to 18 CBRS units in Florida,
           Massachusetts, North Carolina, Rhode Island, and South Carolina.
           During the site visits, we observed the CBRS units and interviewed
           local, state, and federal officials, home owners, realtors,
           insurance agents, and environmental officials to discuss the
           extent of development and factors encouraging or discouraging
           development in the units.

           In addition to the site visits, we conducted telephone interviews
           with local, state, or federal officials in Louisiana,
           Massachusetts, Maryland, Michigan, Rhode Island, Texas, Virginia,
           and Puerto Rico. Using the data collected during the site visits
           and the telephone interviews, we were able to determine reasons
           why development has or has not occurred in those units.
			  
			  Determining the Extent of Federal Assistance Provided to CBRS Units

           To determine the extent of federal assistance provided to CBRS
           units, we identified eight agencies with programs that may have
           provided assistance to these areas. Appendix IV includes a
           complete list of these programs. We reviewed and analyzed federal
           legislation and regulations that are applicable to federal
           assistance to CBRS units, including the CBRA. For each of the
           programs that provide assistance that is prohibited in a CBRS
           unit, we interviewed officials regarding their agency procedures
           for preventing assistance to CBRS units. In instances where we
           identified violations, we collected additional information about
           the assistance provided and interviewed agency officials regarding
           the agency's plans to prevent prohibited assistance from being
           provided in the future.

           We compiled a list of 4,472 addresses in 37 CBRS units that had at
           least one address. (See app. II for a list of CBRS units in our
           review.) As the section above details, we obtained address data
           from local county government sources and electronically mapped
           addresses within the boundaries of CBRS units. Next, we obtained
           data from each agency on program assistance provided and
           determined whether this assistance was provided within one of the
           CBRS units or to an address in a CBRS unit.

           We gathered additional data to determine whether civil works
           projects administered by the Corps and permits issued by the Corps
           or EPA-authorized state agencies were for an activity within a
           CBRS unit. We asked agency officials to provide latitude and
           longitude data for every project that occurred or permit that was
           issued in any of the counties that contained at least one of the
           37 CBRS units. Then we electronically mapped the coordinates to
           determine if the activity occurred within the boundaries of a CBRS
           unit. Corps officials, however, were unable to provide latitude
           and longitude data for a large percentage of the permits issued.

           For each agency program, we assessed the accuracy and reliability
           of the data system by obtaining from the agency written responses
           regarding (1) the agency's methods of data collection and quality
           control reviews, (2) practices and controls over accuracy of data
           entry, and (3) any limitations of the data. We determined that the
           agencies' data were sufficiently reliable for the purposes of our
           review unless noted below. The details of our analysis for each
           agency program are provided below.
			  
			    FEMA National Flood Insurance Program

           To identify flood insurance policies in CBRS units, we obtained
           data from FEMA's National Flood Insurance Program for all policies
           as of May 8, 2006. As mentioned above, we compiled a list of 4,472
           addresses in 37 CBRS units. Because structures built prior to a
           CBRS unit's inclusion in the system may still obtain flood
           insurance, we had to determine whether each structure was built
           prior to the unit's inclusion in the CBRS. Of the 4,472 addresses,
           we were able to determine that 648 structures were built prior to
           the unit's inclusion in the CBRS, and we deleted these addresses
           from our analysis. We reviewed the addresses of all the structures
           built after the unit's inclusion in the CBRS and addresses where
           we could not determine the year built in our flood insurance
           analysis. Thus, we reviewed 3,824 addresses in 21 units to
           determine if the structure had federal flood insurance. Structures
           that were built prior to the CBRS unit's inclusion in the system
           cannot obtain federal flood insurance if the property has been
           substantially improved. We did not collect data on whether
           properties had been improved. If we identified a flood insurance
           policy among the addresses where we were unable to determine the
           year built, we reviewed the year-built data in FEMA's database. If
           FEMA's data revealed that the structure was built prior to the
           unit's inclusion in CBRA, we eliminated the match from our review.
			  
			    FEMA IHP Program

           We provided FEMA our list of addresses located in 37 CBRS units.
           FEMA compared our list of addresses with addresses for which
           Individuals and Households Program (IHP) payments had been
           provided from its National Emergency Management Information
           System. FEMA reviewed payments from the system from August 26,
           1998, to August 2, 2006.

           The Small Business Administration (SBA) provided loan data for
           business and disaster loans in all states with CBRS units from its
           Loan Accounting System. SBA provided us records for loans approved
           January 1, 1990, through May 30, 2006. While we did not find any
           matches for business loans, SBA officials told us that the address
           in the database could be a mailing address and not the physical
           address of the business. For SBA disaster loans, the SBA officials
           said that the address in the database is the location where the
           assistance was provided.
			  
			    HUD Housing Programs

           We obtained data for 13 of the Department of Housing and Urban
           Development's (HUD) single family and multifamily housing
           programs. (See app. IV for a list of the programs reviewed.) HUD
           provided data from its Real Estate Management System and Single
           Family Housing Enterprise Data Warehouse database for loans as of
           June 2006.
			  
			    VA Home Loan Guaranty Program

           The Department of Veterans Affairs (VA) provided loan guarantee
           data from its Home Loan Guaranty database. VA provided us records
           for active loan guarantees as of October 2006.
			  
			    USDA Business and Industry, Community Facilities, and Housing
				 Programs

           We obtained data for 22 of the U.S. Department of Agriculture's
           (USDA) business and industry, community facilities and single
           family and multifamily housing programs. USDA provided this
           information from its Automated Multi-Family Housing Accounting
           System, Guaranteed Loan System, MortgageServ Loan Servicing System
           databases, and Multi-Family Information System. The information
           was as of July 2006.
			  
			    USDA Utility Programs

           For USDA's utility programs, we used a different methodology
           because the projects are not associated with one structure as with
           a flood insurance policy or a housing loan. For USDA's electric
           programs, USDA officials reviewed the construction work plans and
           the environmental reports for recent loans to electric service
           providers who provide service to selected counties in Florida,
           North Carolina, and Virginia that include one or more of the CBRS
           units included in our review. USDA officials determined that it
           does not appear that they have financed projects serving a CBRS
           unit.

           For USDA's water and waste programs, we requested the
           environmental assessment forms statements for the projects in the
           counties that included a CBRS unit we identified as having 100 or
           more structures. We then reviewed these records to determine if
           they indicated that USDA officials had considered whether the
           projects would impact a CBRS unit when reviewing them.
			  
    		    FEMA Public Assistance Grant Program

           FEMA provided data from its National Emergency Management
           Information System on disaster assistance provided to counties and
           territories in our review, including data for the U.S. Virgin
           Islands and Puerto Rico. The data were from November 1998 through
           July 2006. We reviewed assistance designated by FEMA as being
           within a CBRS unit. However, we determined that this designation
           was not sufficiently reliable to identify all projects within the
           CBRS. We could not determine the full extent of assistance
           provided to CBRS units because the CBRS designation in the data
           was not always reliable. In addition, some assistance was provided
           countywide, and we could not determine if this assistance was
           provided to the unit. As a result, we provide examples of disaster
           assistance in our report. Where data were available, we
           electronically mapped the location of the assistance to verify it
           was within a CBRS unit.
			  
			    Federal Highway Administration

           We obtained data for projects receiving federal aid that received
           federal funds between January 1996 and July 2006 in counties with
           a CBRS unit that we identified as having 10 or more structures.
           Federal Highway Administration (FHWA) officials extracted the data
           for these projects from the Financial Management Information
           System---a database that tracks projects that receive federal
           funding. To determine whether assistance was provided that is
           prohibited by law, we identified new construction projects or
           projects that added capacity to existing roadways. To determine
           whether these projects were within a CBRS unit, we relied upon
           interviews and location analysis provided by FHWA officials and
           Department of Transportation officials from New Jersey, North
           Carolina, Puerto Rico, Rhode Island, South Carolina, and the
           Virgin Islands. For projects in New Jersey, state officials
           provided aerial photographs with the location of federally funded
           projects. For North Carolina, we met with FHWA officials to review
           maps displaying the location of federally funded projects. For
           Puerto Rico, FHWA and Puerto Rico Department of Transportation
           officials electronically mapped the location of projects. For
           Florida, we relied upon analysis conducted by an official at the
           Florida FHWA division office. For Rhode Island, South Carolina,
           and the U.S. Virgin Islands, Department of Transportation
           officials or public works department officials provided a paper
           map marked with the location of the projects.

           Because of the volume of projects that are allowable, we did not
           determine the number of allowable projects in every CBRS unit.
           However, we did review the allowable projects in Gulf County,
           Florida, and Onslow County, North Carolina.
			  
^1According to the Fish and Wildlife Service (FWS), there are 585 units in
the system. However, FWS considers the Waites Island Complex to be two
units because portions of the units are in North Carolina and South
Carolina. We counted this as one unit for our analysis. We excluded OPAs
from our review based on discussions with FWS officials. According to the
officials, they did not believe that OPAs were subject to the same level
of development as full system units since they were often protected from
development by other mechanisms.

^2We were unable to obtain data for seven units within the sample because
the local governments were unable to provide address data or year built
for the structures in these areas.			  
			  
			  Appendix II: CBRS Units We Reviewed

           This appendix provides information on the CBRS units that we
           reviewed. Table 2 shows the units included within our random
           sample and the approximate number of new structures in each unit.

Table 2: CBRS Units Included in Random Sample and Approximate Number of
New Structures

                                                                              100 or   
Unit                              No new    1-5 New    6-10 New  11-15 New   More new  
number CBRS unit          State structures structures structures structures structures 
Q01A   Pelican Island     AL        X                                                  
AL-03  Skunk Bayou        AL        X                                                  
E03    Jordan Cove        CT        X                                                  
CT-13  Kelsey Island      CT        X                                                  
CT-01  Mason Island^a     CT                                                           
E09    Norwalk Islands    CT        X                                                  
FL-34  Biscayne Bay       FL        X                                                  
FL-46  Boot Key           FL        X                                                  
P20    Cayo Costa         FL        X                                                  
P31A   Four Mile Village  FL                                                    X      
P05A   Matanzas River     FL                                         X                 
P18    Sanibel Island     FL                                                           
       Complex                                 X                                       
FL-99  Tom King           FL        X                                                  
P10    Vero Beach         FL                   X                                       
S01A   Bay Joe Wise       LA                                                           
       Complex                      X                                                  
S05    Timbalier Islands  LA        X                                                  
C19    Black Beach        MA        X                                                  
C11A   Boat Meadow        MA                   X                                       
C15    Centerville        MA        X                                                  
C00    Clark Pond         MA                              X                            
C16    Dead Neck          MA                   X                                       
C31    Elizabeth Islands  MA        X                                                  
C10    Freemans Pond      MA        X                                                  
MA-30  Herring Brook      MA        X                                                  
C32    Mishaum Point      MA        X                                                  
MA-24  Naushon Island     MA                                                           
       Complex                      X                                                  
MA-16  Nobscusset         MA        X                                                  
MA-33  Phinneys Harbor    MA        X                                                  
C03A   Rexhame            MA        X                                                  
C28    South Beach        MA        X                                                  
C14    Squaw Island       MA        X                                                  
C24    Tuckernuck Island  MA        X                                                  
C01C   West Head Beach    MA        X                                                  
MD-53  Blake Creek        MD        X                                                  
MD-39  Drum Point         MD        X                                                  
MD-15  Long Point         MD        X                                                  
MD-56  St. Catherine      MD                                                           
       Island                       X                                                  
MD-35  Wilson Pond        MD        X                                                  
A03    Jasper             ME        X                                                  
A09    Seapoint           ME        X                                                  
A03B   Starboard          ME        X                                                  
MI-59  Laughing Whitefish MI                                                           
       River^a                                                                         
MI-66  Lightfoot Bay^a    MI                                                           
MI-02  Toledo Beach       MI        X                                                  
MI-43  Whitefish Point    MI        X                                                  
MS-04  Heron Bay Point    MS        x                                                  
R02    Marsh Point        MS        X                                                  
L01    Currituck Banks    NC                                                    X      
L03    Hatteras Island    NC        X                                                  
L08    Wrightsville Beach NC        X                                                  
NJ-04B Metedeconk Neck    NJ                                         X                 
NY-12  Centerpoint Harbor NY        X                                                  
NY-41  Clam Island        NY        X                                                  
NY-39  Cow Neck           NY        X                                                  
NY-59  Fire Island        NY        X                                                  
NY-57  Georgica/Wainscott NY                                                           
       Ponds                        X                                                  
NY-30  Hog Neck Bay       NY        X                                                  
NY-64  The Isthmus        NY        X                                                  
NY-11  Lloyd Harbor       NY        X                                                  
NY-10  Lloyd Point        NY        X                                                  
NY-42  Mill Creek^a       NY                                                           
F10    Napeague^a         NY                                                           
F05    Old Field Beach    NY        X                                                  
NY-16  Stony Brook Harbor NY        X                                                  
NY-76  Walker             NY        X                                                  
PR-53  Bajio de Marea     PR        X                                                  
PR-68  Boca Prieta^a      PR                                                           
PR-79  Penon Brusi^a      PR                                                           
PR-59  Punta Ballena      PR        X                                                  
PR-40  Punta Tuna         PR        X                                                  
RI-12  East Matunick      RI                                                           
       Beach                        X                                                  
RI-07  Hazards Beach      RI        X                                                  
RI-02A McCurry Point      RI        X                                                  
D02B   Prudence Island    RI                                                           
       Complex                                            X                            
M07    Bird Key Complex   SC                   X                                       
M08    Captain Sams Inlet SC                              X                            
M06    Morris Island      SC                                                           
       Complex                      X                                                  
T12    Boca Chica         TX        X                                                  
T11    South Padre Island TX        X                                                  
TX-04  Swan Lake          TX        X                                                  
VI-08  Cangarden Bay      VI        X                                                  
VI-09  Krause Lagoon      VI        X                                                  
VI-17  Pond Bay           VI        X                                                  
VI-06  Robin Bay          VI        X                                                  
VI-04  Southgate Pond     VI        X                                                  
VI-11  Westend Saltpond   VI                   X                                       
VA-42  Chesapeake Beach   VA        X                                                  
VA-25  Fox Islands        VA        X                                                  
VA-45  Harveys Creek      VA        X                                                  
VA-46  Ingram Cove        VA        X                                                  
VA-16  Scarborough Neck   VA        X                                                  

Source: GAO analysis of CBRS units.

Note: There was no development in any unit between 16 and 100 structures.

aThe number of new structures is unknown for these units.

Tables 3 and 4 show the CBRS units we included in our analysis to
determine the extent of federal expenditures and permits made to entities
in the CBRS. Table 3 displays the CBRS units included within our sample
that had structures--regardless of whether the structures were built prior
to or after the units inclusion in the CBRS. Table 4 lists the additional
CBRS units that were suggested for inclusion in our review by FWS because
the agency had information suggesting that development was occurring in
these areas.

Table 3: CBRS Units Included in GAO's Random Sample That Were Analyzed to
Determine the Extent of Federal Expenditures and Permits

Unit number CBRS unit               State 
CT-13       Kelsey Island           CT    
CT-01       Mason Island            CT    
E09         Norwalk Islands         CT    
FL-46       Boot Key Island         FL    
P31A        Four Mile Village       FL    
P05A        Matanzas River          FL    
P18         Sanibel Island Complex  FL    
P10         Vero Beach              FL    
C19         Black Beach             MA    
C11A        Boat Meadow             MA    
C00         Clark Pond              MA    
C16         Dead Neck               MA    
C31         Elizabeth Islands       MA    
C14         Squaw Island            MA    
L01         Currituck Banks         NC    
L08         Wrightsville Beach      NC    
NJ-04B      Metedeconk Neck         NJ    
NY-59       Fire Island             NY    
NY-30       Hog Neck Bay            NY    
NY-42       Mill Creek              NY    
F10         Napeague                NY    
NY-16       Stony Brook Harbor      NY    
RI-12       East Matunick Beach     RI    
D02B        Prudence Island Complex RI    
M07         Bird Key Complex        SC    
M08         Captain Sams Inlet      SC    
VA-45       Harveys Creek           VA    

Source: GAO analysis of CBRS units.

Table 4: Additional CBRS Units Suggested for Review by FWS That Were
Analyzed to Determine the Extent of Federal Expenditures and Permits

Unit Number CBRS unit         State 
P10A        Blue Hole         FL    
P30         Cape San Blas     FL    
P09A        Coconut Point     FL    
FL-94       Deer Lake Complex FL    
P28         Dog Island        FL    
FL-92       Indian Peninsula  FL    
P07         Ormond-by-the-Sea FL    
P08         Ponce Inlet       FL    
FL-98       Santa Rosa Island FL    
L06         Topsail           NC    

Source: GAO analysis of CBRS units.

Appendix III: Snapshots of Selected CBRS Units

Massachusetts

Within the state of Massachusetts, there are 62 CBRS units. The units
consist of 64,076 total acres of land, with 88 percent of the land
considered wetlands by FWS.^1 We visited six CBRS units--Black Beach, Boat
Meadow, Centerville, Herring Brook, Sandy Neck, and Squaw Island. These
units were primarily salt marsh or wetland areas with narrow coastal beach
areas. Only the Boat Meadow unit had experienced any new development since
inclusion in the CBRS. Figure 2 displays the CBRS units we visited during
our site visit.

^1For purposes of this appendix, wetlands include associated aquatic
habitat such as nearshore waters and inlets.

Figure 2: CBRS Units We Visited in Massachusetts

The Herring Brook and Sandy Neck units both include land used as a public
beach destination. The Sandy Neck unit is a coastal barrier beach, with
both public and private beach areas, approximately 6 miles long varying in
width from 200 yards to one-half mile. The unit is classified by the local
government as a conservation and recreation area. Several homes are
located on the unit, but one local official noted they are all registered
by the state as historic places.

The Centerville unit and the Squaw Island unit each have a barrier beach,
but the beach is privately owned. The Centerville unit serves as a private
beach and protective buffer for the homes bordering the unit. A local
official noted the residents annually pay for a beach nourishment project
in order to keep the protective buffer for their homes. The Squaw Island
unit is a barrier beach and wetlands surrounding an area of developed land
that was excluded from CBRS. The excluded area consists of homes valued
between $1.7 and $6.9 million. Figure 3 displays a portion of Squaw
Island.

Figure 3: House and Beach on the Squaw Island, CBRS Unit in Massachusetts

Both the Black Beach and Boat Meadow units consist primarily of salt
marshes and wetlands. The southern portion of the Black Beach unit has one
street of homes that were built prior to CBRA. One local official
described the homes as "traditional Cape Cod" style houses. The Boat
Meadow unit has several neighborhoods bordering the unit with one
neighborhood partially included in the unit. It is within this area that
new development--three single-family homes--has occurred since the unit's
inclusion in the CBRS.

Rhode Island

Within the state of Rhode Island, there are 21 CBRS units. The CBRS units
consist of 10,320 total acres, with 83 percent considered wetlands by the
FWS. During our site visit to Rhode Island, we focused our review on the
Prudence Island Complex unit. The Prudence Island Complex unit consists of
numerous separate pieces of land all included in one CBRS unit. The unit
is located in residential neighborhoods in several counties around the
Narragansett Bay. Although approximately 50 homes are located within the
CBRS unit, only 8 of the homes have been built since inclusion within
CBRS. Figure 4 shows the CBRS units that we visited in Rhode Island.

Figure 4: CBRS Units We Visited in Rhode Island

Several areas included in the Prudence Island Complex are backyards of
private homes. Home owners voluntarily included the CBRS land in their
backyards in conservation easements, limiting the right of future owners
of the property to develop the land. Figure 5 is one of the homes with a
backyard that falls in the CBRS unit boundaries.

Figure 5: Home with a Backyard in the Prudence Island, Rhode Island CBRS
Unit

Another area included in the unit is owned by the Rhode Island Country
Club and serves as a golf practice area. Figure 6 is the country club land
that is included in the CBRS.

Figure 6: Portion of the Prudence Island Complex CBRS Unit

The unit also includes a small beach and a wetland inlet located in a
residential neighborhood. The inlet leads to the Rhode Island Country
Club. A local official stated that the County Club has asked the U.S. Army
Corps of Engineers to re-dredge the inlet to improve the playability of
the golf course--which gets heavily saturated during rains. Dredging
within the CBRS unit would allow water to run off the course faster.
Figure 7 shows the area within the CBRS unit that would be dredged.

Figure 7: Inlet Where Proposed Dredging Project Would Occur in the
Prudence Island CBRS Unit

South Carolina

Within the state of South Carolina, there are 16 CBRS units. FWS officials
determined that the units consist of 97,856 total acres, with 90 percent
of land considered wetlands. We visited two units in South Carolina--Bird
Key Complex and Captain Sams Inlet (see fig. 8). Each of the units has
experienced the addition of 10 or fewer residential homes since its
inclusion in the CBRS. The developed portions of both of these units are
located on coastal islands--the Captain Sams Inlet homes are located on
Seabrook Island, and the Bird Key Complex homes are located on Kiawah
Island.

Figure 8: CBRS Units We Visited in South Carolina

Development in the Captain Sams Inlet CBRS unit is located in the Seabrook
Island Resort--a 2,200-acre, privately gated, beachfront community on
Seabrook Island. According to local officials, the title to the land where
these homes are located was in dispute for years, which delayed its
development, unlike the rest of the island. Local officials also stated
that they believe that if the title to the land had not been in dispute,
the area would have developed at the time of the CBRS unit designations
and most likely would not have been included in the CBRS. Because of the
CBRS inclusion, the property owners in the unit are no longer eligible for
certain types of federal assistance, in particular federal flood
insurance, which they noted is much less expensive than privately
available insurance. Officials with whom we met on neighboring Kiawah
Island stated that a developer has plans to build up to 50 units on a
20-acre portion of the Captain Sams Inlet CBRS unit that is located on
Kiawah Island.

Development in the Bird Key Complex CBRS unit is located on the northeast
portion of Kiawah Island, which is also a privately gated, beachfront
community with approximately 3,000 homes. The southern portion of the CBRS
unit includes a few homes that we identified as being located in the unit,
an 18-hole golf course, and an area of land called "Cougar Island." Kiawah
officials told us that a private developer has plans to build 360 homes on
24 acres of Cougar Island at a future date.

Florida

Within the state of Florida, there are 67 CBRS units. The units range
extensively in size and composition and encompass 285,937 total acres
along both the Atlantic and Gulf Coasts. Overall, 87 percent of the land
within the units is considered wetlands by FWS. We visited three
units--Four Mile Village, Cape San Blas, and Deer Lake Complex (see fig.
9). All three units we visited had experienced some level of development.
However, the development ranged from 11 new structures in Deer Lake
Complex to at least 900 new structures in Cape San Blas since the units
inclusion in the CBRS.

Figure 9: CBRS Units We Visited in Florida

The Four Mile Village unit in Florida has experienced an increase of at
least 100 new residential structures since its inclusion in CBRS. This
unit is expected to continue to experience development, as a 167-home
private development project called Cypress Dunes is completed. The Cypress
Dunes project consists of a 44-acre gated community and will include a
clubhouse, pool, exercise center, dining facility, and tennis courts, all
entirely within the CBRS unit.

The 1,637-acre Topsail Hill Preserve State Park makes up more than
one-half of the Four Mile Village CBRS unit. The preserve was purchased in
1992 with funds from the Conservation Acquisition of Recreation Lands
program, also known as Forever Florida. Topsail was purchased for its
unique natural ecosystems, including freshwater coastal dune lakes, wet
prairies, scrub, pine flatwoods, marshes, cypress domes, seepage slopes
and 3.2 miles of sparkling white sand beaches. The park also includes
areas to bike, walk, swim, fish, and access to the beach, plus a
full-facility campground features a swimming pool, tennis courts, and
shuffleboard courts.

The Cape San Blas CBRS unit is located on a peninsula in the Florida
panhandle. It has experienced significant development since its inclusion
within the CBRS with the addition of at least 900 new homes. Primarily,
the homes are single-family residences used as vacation homes and rentals.

In November 2002, FEMA designated parts of Cape San Blas as a special
flood hazard area. Mortgage lenders require home owners in these zones to
obtain flood insurance. Because federal flood insurance is not available
in CBRS, home owners with mortgages must obtain private flood insurance.
At the same time, officials told us that the cost of private insurance has
skyrocketed and is no longer comparable to national flood insurance
program rates. According to local officials, tourism in the Cape San Blas
area is important to the economy of the county. They told us that property
values in the unit have decreased since FEMA adopted a special flood
hazard area for the CBRS unit. Residents and local officials have
unsuccessfully attempted to remove Cape San Blas from the CBRS so that
residents would be eligible to obtain flood insurance through the National
Flood Insurance Program. In the 109th Congress, legislation was introduced
in the House of Representatives that would exempt Cape San Blas, along
with another unit, from CBRA's prohibitions and the limitations on flood
insurance.^2 However, the bill never came to a vote.

We identified some development in the Deer Lake Complex unit since its
inclusion within the CBRS. A total of 11 new single-family homes have been
constructed within the unit.

^2H.R. 3280, 109th Cong. (2005)

North Carolina

Within the state of North Carolina, there are 10 CBRS units consisting of
52, 215 total acres--approximately 6,809 of those are considered
developable acres by FWS. We visited four CBRS units--Topsail, Lea Island,
Currituck Banks, and Wrightsville Beach (see fig. 10). Both Topsail and
Currituck have experienced significant levels of development since
inclusion within the CBRS. In contrast, Lea Island and Wrightsville Beach
are impractical locations for development as they are significantly
affected by erosion and shifting sands.

Figure 10: CBRS Units We Visited in North Carolina

The Topsail unit in North Topsail is a barrier island with low elevation
without the protection of substantial dunes. It has a total of
approximately 1,600 structures and local officials stated that most of the
structures were built after CBRA was enacted. The unit consists of single
and multifamily homes, a few hotels/motels, a convenience store, and the
North Topsail Beach Town Hall.

In recent years, the unit has been hit several times by hurricanes. For
example, in 1996, Hurricanes Bertha and Fran caused significant damage.
The storms leveled dunes, cut new channels across the island, dumped tons
of sand, and destroyed more than 300 buildings. The federal government
provided funds that assisted in repairing the streets, repairing water and
sewer lines, replacing signs, and removing substantial debris. Since that
time, the area has been rebuilt, but other storms have continued to cause
damage. We identified at least $5.6 million in disaster assistance that
was provided to entities in the unit since November 1998.

Portions of the Topsail CBRS unit have experienced substantial levels of
erosion. As the soil erodes, the ocean becomes dangerously close to the
homes. Figure 11 pictures one of several homes in the Topsail area where
the ocean waves make contact with the home's foundation.

Figure 11: House in North Topsail CBRS Unit on the Edge of the Ocean

Several areas outside of the CBRS unit have approved plans for a federally
funded Corps beach renourishment project. However, because areas within
the CBRS unit are ineligible for federal funding for a beach renourishment
project, local officials are pursuing other opportunities to fund the
portion of the project that falls within the CBRS boundaries. For example,
the Town of North Topsail Beach recently proposed a $34 million bond
package to pay for the beach renourishment project, but the voters
rejected the proposal in November 2006.

According to local officials, during the time when much of the development
occurred in the Topsail unit, affordable private flood insurance was
generally available. However, in recent years the cost of private flood
insurance has increased tremendously. Currently, these officials said that
many residents are frustrated with CBRA's prohibitions on the availability
of federal flood insurance and federal funding for beach renourishment
projects. According to these officials, residents in the Topsail CBRS unit
are upset that they must pay significantly higher insurance premiums than
their neighbors who own properties just outside of the unit who can obtain
federal flood insurance.

The Currituck Banks CBRS unit is located on the outer banks of North
Carolina, with the northern boundary at the Virginia state line. The unit
has also experienced significant new development, with at least 400 new
residential homes built since inclusion in CBRS. Local officials stated
that rapid development has occurred in the area since the late 1980s and
that as of June 2006, there were 550 single-family dwellings within the
unit. However, officials noted this only represents 18 percent of the
total capacity of homes that can be built in the unit. County planning
staff noted that the area currently has 3,088 actual or planned building
lots available. Although the Currituck Banks unit does not have any paved
roads and is only accessible by four-wheel drive vehicle or boat, it still
continues to be developed, partly because people on the Outer Banks are
seeking the solitude that living in the CBRS unit can provide. Moreover,
the unit has an extensive canal system that allows residents direct boat
access to their homes and the mainland.

The Lea Island CBRS unit is a tiny barrier island, accessible only by
boat, and located south of the Figure Eight Island. The island is
privately owned, but local officials stated that conservation groups are
slowly trying to buy more of the island. The island is approximately 60
acres long with most of the land less than 10 feet above sea level. The
island is in a constant state of flux due to erosion and shifting sand.
According to a local coastal official, 15 homes previously existed on Lea
Island, but all of them--except for one small cabin--had been destroyed by
natural disasters.

At the time CBRA was enacted, FWS determined that the Wrightsville Beach
unit had 83 developable acres of land. However, sand continuously shifts
within the unit. At one point, the majority of sand in the unit had
shifted to such an extent that the entire unit was under water. According
to local officials, to keep the unit above water, local entities must
continually dredge an inlet adjacent to the unit to replenish the unit
with sand.

Appendix IV: Programs and Types of Federal Assistance Analyzed

U.S. Army Corps of Engineers

Permits - Section 404 and Section 10
Civil Works programs

U.S. Department of Agriculture

Business and Industry Programs

Business and Industry Direct Loans
Business and Industry Guaranteed Loans
Intermediary Relending Program
Rural Business Enterprise Grants
Rural Business Opportunity Grants
Rural Economic Development Loans
Rural Economic Development Grants
Renewable Energy and Energy Efficiency Program

Community Facilities Programs

Community Facilities Direct Loans
Community Facilities Guaranteed Loans
Community Facilities Grants

Electric Programs

Hardship Loans
Municipal Loans
Treasury Loans
FFB Guaranteed Loans

Single Family Housing Programs

Rural Housing Guaranteed Loan
Rural Housing Direct Loan
Housing Repair and Rehabilitation Loan
Housing Repair and Rehabilitation Grant
Rural Housing Site Loans
Mutual Self-Help Housing Grants
Homes for Sale

Multifamily Housing Programs

Farm Labor Housing Loans and Grants
Rural Rental Housing Loans
Guaranteed Rental Housing
Rental Assistance Program

Water and Waste Programs

Water and Waste Disposal Loans
Water and Waste Disposal Grants
Emergency Community Water Assistance Grants
Revolving Fund Program
Household Water Well System Program

Department of Homeland Security

Federal Emergency Management Agency

National Flood Insurance Program
Individuals and Households Program
Public Assistance Program (Disaster)

U.S. Coast Guard

Permits for bridges over navigable waters of the United States

Department of Housing and Urban Development

Single Family Housing Programs

Mortgage Insurance - Section 203(b)
Rehabilitation Mortgage Insurance - Section 203(k)
Mortgage Insurance for Condominium Units - Section 234(c)
Home Equity Conversion Mortgage - Section 255

Multifamily Housing Programs

Supportive Housing for the Elderly - Section 202
Mortgage Insurance for Cooperative Housing - Section 213
New Construction/Substantial Rehabilitation of Apartments with Nonprofit
Sponsors - Section 221(d)(3)
New Construction/Substantial Rehabilitation of Apartments with For- profit
Sponsors - Section 221(d)(4)
Refinancing of Apartment Primary Loans - Section 223(a)(7)
Healthcare Facilities - Section 232
Refinancing of Healthcare Facilities - Section 232
Supplemental Loan Insurance - Section 241(a)
Supportive Housing for Persons with Disabilities - Section 811

Environmental Protection Agency

National Pollution Discharge Elimination System (NPDES) permits

Federal Highway Administration

Federal Aid Highway Program

Small Business Administration

7 (a) and 504 Loan programs
Disaster Loan program

Department of Veterans Affairs

Veterans Benefits Administration Home Loan Guaranty Program

Appendix V: Comments from the Department of Housing and Urban Development

Appendix VI: Comments from the Department of the Interior

Appendix VII: Comments from the Department of Veterans Affairs

Appendix VIII: GAO Contact and Staff Acknowledgments

GAO Contact

Anu K. Mittal (202) 512-3841 or [email protected]

Staff Acknowledgments

In addition to the contact named above, Sherry McDonald, Assistant
Director; Natalie Herzog; Stuart Ryba; Jay Spaan; Amy Ward-Meier; and
Leigh M. White made key contributions to this report. Also contributing to
this report were Kevin Bray, John Delicath, Nancy Hess, Gloria Saunders
and Jay Smale.

(360666)

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www.gao.gov/cgi-bin/getrpt?GAO-07-356 .

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Highlights of [66]GAO-07-356 , a report to the Honorable Wayne T.
Gilchrest, House of Representatives

March 2007

COASTAL BARRIER RESOURCES SYSTEM

Status of Development That Has Occurred and Financial Assistance Provided
by Federal Agencies

In 1982, Congress enacted the Coastal Barrier Resources Act. The Coastal
Barrier Resources Act, as amended (CBRA), designates 585 units of
undeveloped coastal lands and aquatic habitat as the John H. Chafee
Coastal Barrier Resources System (CBRS). CBRA prohibits most federal
expenditures and assistance within the system that could encourage
development, but it allows federal agencies to provide some types of
assistance and issue certain regulatory permits. In 1992, GAO reported
that development was occurring in the CBRS despite restrictions on federal
assistance. GAO updated its 1992 report and reviewed the extent to which
(1) development has occurred in CBRS units since their inclusion in the
system and (2) federal financial assistance and permits have been provided
to entities in CBRS units.

GAO electronically mapped address data for structures within 91 randomly
selected CBRS units and collected information on federal financial
assistance and permits for eight federal agencies.

[67]What GAO Recommends

GAO recommends, among other things, that the four agencies that provided
prohibited loan guarantees or insurance policies to CBRS units first
verify and then cancel those that are in violation of CBRA. Three agencies
agreed with our recommendation; VA did not, stating that it would inflict
unfair harm to the affected veterans.

An estimated 84 percent of CBRS units remain undeveloped, while 16 percent
have experienced some level of development. About 13 percent of the
developed units experienced minimal levels of development--typically
consisting of less than 20 additional structures per unit since becoming
part of the CBRS, and about 3 percent experienced significant
development-- consisting of 100 or more structures per unit--since
becoming part of the CBRS. According to federal and local officials, CBRA
has played little role in the extent of development within the CBRS units
that we reviewed because they believe that other factors have been more
important in inhibiting development. These include (1) the lack of
suitably developable land in the unit; (2) the lack of accessibility to
the unit; (3) state laws discouraging development within coastal areas;
and (4) ownership of land within the unit by groups, such as the National
Audubon Society, who are seeking to preserve its natural state. In units
that GAO reviewed where development had occurred, federal and local
officials also identified a number of factors that have contributed to
development despite the unit's inclusion in the CBRS. These include (1) a
combination of commercial interest and public desire to build in the unit,
(2) local government support for development, and (3) the availability of
affordable private flood insurance.

Multiple federal agencies have provided some financial assistance to
property owners in CBRS units that is expressly prohibited by CBRA; some
assistance allowed under CBRA; and hundreds of permits for federally
regulated development activities within the unit. Specifically, four
agencies--the Department of Housing and Urban Development, the Department
of Veterans Affairs, the Federal Emergency Management Agency, and the
Small Business Administration--provided financial assistance, such as
flood insurance and loan guarantees, totaling about $21 million that is
prohibited by CBRA to property owners in CBRS units. Although most of
these agencies had processes in place to prevent such assistance from
being provided, they cited problems with inaccurate maps as being a key
factor leading to these errors. With regard to financial assistance
allowed by CBRA, GAO found that three federal agencies have provided such
assistance but did not track how much assistance they provided, so the
total extent of this assistance is unknown. With regard to permits issued
in CBRS units for federally regulated activities, GAO identified hundreds
of permits issued by the Army Corps of Engineers and state agencies
authorized to issue permits on behalf of the Environmental Protection
Agency. These permits covered various activities such as the construction
of piers, the discharge of dredged or fill material into federally
regulated waters, and permits associated with water discharges from
construction sites or wastewater treatment systems.

References

Visible links
  54. http://www.gao.gov/cgi-bin/getrpt?GAO/RCED-92-115
  57. http://www.gao.gov/cgi-bin/getrpt?GAO-06-1013
  66. http://www.gao.gov/cgi-bin/getrpt?GAO-07-356
*** End of document. ***