SERVICE iii:mmiflnfljwfifimiflflmfiifullma mum WATER RESOURCES DEVELOPMENT: ADMINISTRATION REFORM EFFORTS ISSUE BRIEF NUMBER IB78073 AUTHOR: S innons , Malcolm Environment and Natural Resources Policy Division THE LIBRARY OF CONGRESS CONGRESSIONAL RESEARCH SERVICE MAJOR ISSUES SYSTEM DATE ORIGINATED g§4)__1_41§ DATE UPDATED Qzggggg FOR ADDITIONAL INFORMATION CALL 287-5700 0718 CRS- 1 IB78073 UPDATE-07/1“/80 l§§QE...12§ 21.511229! As part of its reform of national water policy, the Carter Administration has attempted to implement a national water policy and break the so—called pork barrel politics of water resources development and fund only what it m considers the most worthy projects. much of the early Administration activity focused on the review of controversial water projects and recommendation as to their continuation or deletion. The 95th Congress, while initially somewhat in agreement with the Administration policy towards water projects, sought not only to revive, through continued funding, many of the projects the President recommended be deleted, but also to fund new projects. In the 96th Congress, the Administration has continued to. review water projects and recommend the discontinuation of some projects, but has also recommended the investigation of the feasibility of certain new projects. The President's Kay 13, 1977, environmental message to Congress initiated a review of national water policy. The review was conducted by the Water Resources Council, the Office of management and Budget, and the Council on Environmental Quality. The product of this review -- the “Issue and Option Papers" - were published in the §ggg§a;_§ggi§te; in July of 1977» After review of the "Issue and Option Papers," the President announced to the Congress his Water Policy Initiatives on June 6, 1978. The Initiatives were designed to: o Improve planning and efficient management of Federal water resource programs to prevent waste and to permit necessary water projects which are cost-effective, safe, and environmentally sound to move forward expeditiously. o Provide a new, national emphasis on water conservation. o Enhance Federal-State cooperation and improved State water resources planning. o Increase attention to environmental quality. Other than recommendations on controversial water projects, specific actions taken by the Administration consistent with the Initiatives have been 9 the promotion of bills restructuring the Water Resources Council to provide an independent review function for water projects, and implementing cost sharing for Federal water projects. A related effort attempted in the 95th Congress was the implementation of "full funding“ of water projects in lieu of "incremental" funding. At issue is who should set policy that governs the expenditure of Federal dollars for water resources projects. Historically, Congress has had fiscal control over water project development. For a project to be authorized and onstructed, it must be included in water resource development and -ppropriation bills, and voted on collectively. Efforts have been made to depoliticize and provide rational criteria for water project selection. These efforts have resulted in development of benefit/cost analysis cns- 2 1373073 UPDATE-07/1#/80 .procedures and water development guidelines entitled “Principles and Standards." The Carter Administration believes the existing rationale for A water project selection is insufficient, an sees the need for imposing a greater financial accountability on these water projects. 1 EACKGBQEND A!2-P0LlQl-A!ALYSl§ Water resource development projects are a large item in Federal government lexpenditures. Currently there are 783 water projects underway at a cost to the taxpayer of over $20 billion;, in addition, 497 projects have been authorized and await construction funding. One of the principal reasons for this overload of projects is Congress‘ process for authorization and appropriation of construction funds. This is a political process that‘ utilizes federally defined development criteria. The political process by ‘which a water project is selected for authorization and construction funding has been nicknamed "pork barrel politics" by its critics. In the authorization phase, Members of Congress vote collectively on the omnibus rivers and harbors bill for that particular year. In the analysis of critics of the process, as more Congressmen request authorization of projects in their jurisdictions, there is less incentive to judge the projects individually on their merits, as a vote against a project thought unworthy would necessarily mean a vote against the sum total of all projects in the bill. Thus, the more projects are added to the bill, the more the bill gains support. After the Congress authorizes a project through the omnibus rivers and harbors bill, it must then decide upon Federal appropriations for construction. Available funds for water project construction are normally insufficient to finance the construction of all the projects authorized. At this point, another political selection process takes place in which favored projects from those authorized are selected for construction funding. V In addition to the political aspects. of selection, there are also economic-development criteria for the selection of water projects. The formulation of development criteria began with the Flood Control Act of 1936 and evolved into the water Resources Council's 1973 "Principles and Standards" (now under revision), but the overload of projects and the limits of Federal funding for water projects development indicate that there is a need for further priority selection of the projects that are truly necessary and cost—effective. The following sections describe congressional contributions to water development criteria as well as the Carter Administration's recommended changes. A§929re§§;2nal-Q_n:ribution§ to Hate: Dex§l92ne2s.§riL§ria The Congress has contributed to the development of water resource project development evaluation criteria through numerous enactments, the most significant of which are the Flood Control Act of 1936, the Water Resources Planning Act of 1965, the National Environmental Policy Act of 1969, the River and Harbor Flood Control Act of 1970, and the Water Resources Development Act of 197a. multiple purpose water resource development projects have been constructed by the Corps of Engineers, the Bureau of Reclamation, and other Federai agencies under the principle that benefits should exceed costs. Benefit/cost analysis, the basis for evaluation of these projects, had its roots in the cns- 3 1 1373073 upnarr-07/14/so Flood Control Act of 1936. The analysis is designed to provide an objective evaluation procedure for comparing in monetary terms the estimated benefits of a proposed project with its estimated costs to determine whether the project is economically justified. Benefit/cost analysis is one of several factors considered by Federal water resources development agencies and Congress in determining whether or not to approve a proposed project. Until recent years, national emphasis on economic growth provided the principal basis for water resources develrmment, and technically feasible projects that maximized the net economic benefits lent themselves to favorable evaluation through the benefit/cost analysis procedure. More recently, however, the American public has become concerned with environmental and social consequences of proposed water resources development projects. In response, Congress enacted the National Environmental Policy Act of 1969 (P.L. 91-190), which requires that the short- and long-term environmental consequences of a proposed Federal project must be evaluated and set forth in an environmental impact statement. Also, the River and Harbor and Flood Control Act of 1970 (P.L. 91-611) stated that not only was national economic development a goal of federally financed water resources projects, but that regional development, the quality of the toal environment, ,and the well-being of the people were also goals that should »be considered. These last two goals, unfortunately, do not.readily lend themselves to easy quantification as do the goals of national and regional economic development. Difficulties therefore arise in evaluating these goals by the same benefit/cost evaluation procedures used in evaluating economic development. The Water Resources Council, created by the Water Resources Planning Act of 1965 (P.L. 89-80) provides guidelines for the nation for water resource development and performs other functions, such as periodically assessing the nation's water supplies and analyzing the relation of regional and river nasin plans to larger planning efforts. The chairman of the Council is designated by the President, and the members of the Council are the secretaries of Interior, Agriculture, Army, the Federal Power Commission, Commerce, Transportation, and the Administrator .of the Environmental Protection Agency. Section 103 of the Act provides that the Council, after consultation with‘ Federal and non4Federal entities and with the approval of the President, shall establish principles, standards, and procedures for the formulation and evaluation of Federal water and related land resources projects. with this mandate, the Council proceeded to develop the "Principles and Standards" as guidelines for water resources development. The Water Resources Council in its 1970 Task Force Report proposed the four evaluation objectives recommended in the 1970 River and Harbor- Flood Control Act. when the Council's "Principles and standards" finally went into effect on October 1973, however, only two of the objectives -9 national economic development and environmental quality -- were to be considered in water resources development projects. The major significance of the new principles and standards, as compared to the prior analytical criteria, was that they placed environmental concerns on a basis equal to economic development. Also, they required consideration of the beneficial and adverse effects on regional development and social well-being and evaluation of alternative plans. Development of the implementing procedures and the detailed methods for making benefit-cost determinations were delegated to the water resources agencies. The water Resources Development Act of 1974 (P.L. 93-251) required in Section 80(c) that the President make a full and complete investigation and study of the principles and standards for planning and evaluating water and cns- n 1373073 UPDATE-O7/1H/80 ‘related resource projects. In September“ 197fl, President Ford assigned responsibility for this study to the Water Resources Council. This study was to include consideration of enhancing regional development, the quality of the toal environment including its protection and improvement, the well-being of the people of the United States, and the national economic development as objectives to be included in federally financed mater projects. The study was also to evaluate the discount rate and non-Federal cost-sharing for such projects. While the report was released in November 1975, the accompanying .recommendations have never been released because of controversy surrounding the recommendations on non-Federal costssharing: while the ' Council recommended only a slightly higher non-Federal cost-sharing, the Office of ,Management and Budget favored a substantially higher rate. The evaluation of the Principles and Standards has continued in the Carter hdministration.y In his water policy initiatives, the President requested the integration of water conservation planning elements and the inclusion of a "non-structural" alternative plan when a structural water project is proposed. The Water Resources Council published the final rules for calculating the national economic development benefits and costs in the Dec. 1a, 1979, Federal Register, and the rules for calculating environmental quality benefits and costs in the Apr. 1a, 1980, §ggg;gl_§ggi§te;. §a;:_2-Ad_;ni§§re:i92.!eser-2roiect Policz In his Environmental Message to the Congress of may 23, 1977, President Carter asked for the development of a national water resources management policy, stating that: ...it is essential to confine the public works efforts of the water development agencies to projects that can meet such defensible criteria as economic efficiency, safety, environmental protection, and fair distribution of project benefits. The President directed the Office of Management and Budget, the Council on Environmental Quality, and the Water Resources Council, in consultation with the Congress and the public, to review the present Federal water resources policy. Major topics under consideration were identified by the Water Resources Council in the "Issue and Options Papers" promulgated in the Federal Register July 15 and 25, 1977. The seven major topics identified in the "Issues and Option Papers" were: 7 0 Revision of water resources planning and evaluation criteria and procedu res . o Cost sharing. o Policy considerations and alternatives relative to institutions and institutional arrangements. 0 Water conservation. 0 Water quality. o Research . o Federal reserved water rights. In July and August 1977, regional hearings were held in ninneapolis, Boston, Dallas, Atlanta, Los Angeles, consultations with officials and the transmitted to the on June 6, Initiatives to the The Initiatives CBS- 5 IB78073 UPDATE—0]/14/80 Denver, Following local Seattle, and Cincinnati. Members of Congress, State, county, city, and other public, the results of the water policy study were President by the Secretary of the Interior in May 1978. President Carter presented his Federal Water Policy Congress. 1978, were designed to: 0 Improve planning and efficient management of Federal water resource programs to prevent waste and to permit necessary water projects which are cost-effective, safe, and environmentally sound to move forward expeditiously. o Provide a new, national emphasis on water conservation. 0 Enhance Federal—State cooperation and improved State water resources planning. o Increase attention to environmental quality. In the 1. "Issue and Options Papers," specific problems project planning and development were identified: relating to water whether the objectives of Federal water resources policy should be limited to national economic development and environmental guality.p Other possible objectives are conservation, regional development, and social well-being. The discount rate used in water resources development is too unstable for orderly planning, varying by as much as one-fourth of 1% per year. Many projects have "unrealistically" low discount rates because of the "grandfather clause“ of Section 80(d) of the 197a Water Resources Planning Act. The present discount rate is criticized by some as too high, and by others as too low. A high discount rate reduces the number of projects that are justified by cost/benefit analysis and tends to bias planning toward large-scale projects addressing long-term needs. Water resources planning emphasizes construction projects at the expense of non-structural measures. An example of a non-structural measure is flood plain management in lieu of building a dam to protect the same flood plain. There is an inconsistency in the calculations of benefits and costs not only from agency to agency, but also from program to program and from purpose to purpose. Whether non-Federal entities should be required to pay a larger share of Federal project costs. What are the appropriate roles to be played by the Federal, State, and local governments in water project planning. cns- 6 1373073 UPDATE-O7/14/80 In his Hater Policy Initiatives, the President made recommendations to the Congress on each of these problems. Concerning the first point, he recommended that the Principles and Standards could be improved by considering water conservation as a component of national economic . development and environmental quality objectives, rather than assigning it separate objective status. Projects should have net national economic benefits unless there are environmental benefits that clearly more than . compensate for any economic deficit. Net adverse environmental consequences should be significantly outweighed by economic benefits. Concerning the second point, the President concluded that the present discount rate is exreasonable and therefore no change in the current formula is necessary. a Similarly, he did not recommend changes in the discount rate for currently authorized projects. Concerning the third point, the President recommended that the Principles and Standards be improved by requiring explicit formulation and consideration of a primarily non-structural plan as one alternative whenever structural water projects are planned. Concerning the P fourth point, the President recommended that consistent, specific procedures be implemented for calculating benefits and costs in compliance with the Principles and Standards. Concerning the fifth point, the President recommended that the States be required to pay 10% of the construction costs of projects with vendible outputs (such as water supply, irrigation, power, and recreation benefits) and 5% of the construction costs of projects without vendible outputs. The 10%/5% State cost sharing arrangement would be in addition to existing cost-sharing arrangements. Concerning the last point, the President recommended that the Water Resources Council act as a water project coordinating body and as a project review board to ensure an impartial review of pre-construction project plans for their consistency with established planning and benefit/cost analysis procedures and applicable requirements. On July 12, 1978, the President began implementation of his water policy through thirteen directives to executive agencies. Nineteen federal inter-agency task forces were formed to carry out the directives; each task force is headed by a lead agency and is composed of representatives from other involved agencies. The Secretary of the Interior has been given the responsibility for the carrying out of the directives. The thirteen directives cover the following topics: o Improved planning and evaluation of federal water resources programs and projects. o Environmental quality and water resources management. 0 Non-structural flood protection methods. o Enhanced Federal-State cooperation in water management. o Federal and Indian reserved water rights. 0 Water conservation and floodplain management in federal programs. a w o Conservation pricing of water supplied by federal projects. CBS? 7 IB78073 UPDATE—07/14/80 0 Technical assistance for water conservation in water-short areas. 0 Water conservation in housing assistance programs. 0 Water conservation at federal facilities. 0 water conservation provisions in loan and grant programs for water supply and treatment. 0 Agricultural assistance programs in water-short areas. ’ o Inprovenents in soil conservation service programs. A2£;_i:;§§-0f the-94th-§9n9re§§ Appropriations for the civil works program of the Army Corps of Engineers, the Bureau of Reclamation, and several other water resource agencies are contained principally in Public works for Water and Power Development and Energy Research Appropriation Acts. Public Laws 94-180 and 90-355 made the following appropriations for the Corps and the Bureau: Corps of Bureau of Eng ;.1;e.<-2-rs 1.%ec_=..l.;.ar.I.a:c..3;<.>;1. Fiscal 1975 V 52.125.507.000 $530.73u.000 Transition Quarter 55u,157,0o0 118,489,000 Fiscal 1977 A 2,357,002,000 755,599,000 The fiscal 1976 appropriation included 25 new planning and 16 new ~ construction starts compared to 15 new planning and no new construction starts in the Administration's budget request. The 1977 appropriation included 19 new planning and 25 new construction starts compared with 3 new ~ planning and no _new construction starts in the Administration's budget request. Among controversial projects included in these appropriation bills are the following for which amendments to delete funding were offered but failed to be enacted in either the House or Senate: Dickey-Lincoln. Maine Corps FY76 House 5 Senate Trinity River Project, Texas Corps FY76 8 77 House Garrison Diverson Unit. North Dakota Bureau FY76 8 77 House CRS- 8 IB78073 UPDATE-O7/1H/80 Gathright Dam, Virginia Corps FY77 House Meramec Park Dam, nissouri Corps FY77 House Wabash Canal, Indiana (Feasibility Investigation) Corps FY77 House 2§:1.1.<_=92s1I.=.e.=§s= C§=1.rte.r..lL<1r2.i.n..i.§:I;.e;:i9..I;-A1.:’2ea2t§-L9-2i§s;-ntinue Er=.1§er.2_I;<.>:i<.e<.=.t..s. In January 1977, the Carter Administration transition team recommended that 61 Federal water projects costing more than $13 billion needed review. is Included in these projects were the six projects included in the 9nth Congress appropriation bills for which amendments were offered but failed to __ be enacted. In a message to Congress, the President claimed that these 61 to projects which were "approved in the past under different economic circumstances and at times of lower interest rates are of doubtful necessity now, in light of new economic conditions and environmental policies." The President's Council on Environmental Quality indicated that the President's recommendations on these projects were based on one or more of the following factors: 1. Major adverse environmental impacts; 2. Questionable economic justification (low benefit/ 9 cost ratio); 3. Low proportion of Federal expenditures to total projects costs; a. Conflict with other Federal water resource management policies. After a further screening of 337 Bureau and Corps projects and 5 TVA projects, in February 1977 the Administration developed a new list of 19 water projects needing review. This list was modified in march by adding 16 projects and dropping three, thus bringing the total number of projects the Administration was recommending for review to 32. The three projects dropped were the Dickey-Lincoln School Lakes in Maine, Paintsville Lake in Kentucky, * and Freeport in Illinois. The new list of 32 included 11 Bureau projects, 19 Corps projects, and 2 TVA projects. On Apr. 18, 1977, after hearings had been held and review had been completed, the White House issued a statement indicating which of the 32 projects it was recommending for deletion, modification, and continuation, as well as potential savings due to these deletions and modifications (see Table I). Eighteen projects were recommended for deletion, 5 for modification, and 9 for continued funding. Of the 18 projects ‘recommended for deletion, 12 ‘A were Corps projects, 5 Bureau projects, and 1 a TVA project. It was also stated that further analysis of the Auburn Dam (California), the Narrows Unit (Colorado), and the Oahe project (South Dakota) might eventually lead to 9 reinstatement or modification. The White House estimated that total savings from the 13 projects recommended for deletion was $2.53 billion, while the estimated savings due to modifications was $1.45 billion. CRS- 9 IB78073 UPDATE-07/1fl/80 water Resources Projects Presidentially Reconmended for Deletion, Modification, and Continued Funding, Together with Costs and Savings Eesonzeeéasiga-£2£-2el.§;22 TABLE I: 1. Applegate Lake, Oregon (C03) 2. Atchafalaya River 8 Bayous Boeuf, Black 6 Chene, Louisiana (COB) 3. Bayou Bodcau, Louisiana_(COB) 4. Cache Basin, Arkansas (COB) 5. Grove Lake, Kansas (COB) 6. Hillsdale Lake, Kansas (COB) 7. LaFarge Lake, Wisconsin (COB) 8. Lukfata Lake, Oklahoma (COB) 9. neranec Park Lake, nissouri (COB) K 10. Richard B. Russell, Georgi South Carolina (COB) 11. Tallahala Creek, Hississippi (COB) 12. Yatesville, Kentucky (COB) 13. Columbia Dan, Tennessee (TVA) 1n. *Auburn, California (BR) 15. Fruitland Hesa, Colorado (BR) 16. *Narrows Unit, Colorado (BR) 17. *Oahe, South Dakota (BR) 18. Savery+Pot Hook, Colorado, *Further analysis-;ight eventually Wyoming (BR) TOTAL SAVINGS modification. Original FY78 Total Request Savings 1§-2il;i2uL J§-mi;li2uL 7.4 7u.o 5.1 10.1 2.u 10.0 2.0 »88.5 1.0 83.9 1fl.O 38.6 2.0 36.9 0.2 29.6 10.0 88.7 21.0 254.9 5.9 52.0 20.0 11o.u 39.7 898.6 7.7 82.5 9.7 139.2 17.0 414.fl é;Q 21:; $177.n $2,526.3 lead to reinstatement or 1. 2. 3. 4. 5. 6. CBS-10 ggggggggdation for Mississippi River, Gulf Outlet Louisiana (COE) Tensas Basin, Arkansas and Louisiana (COE) Bonneville Unit, Central Utah Project, Utah (BR) _ Central Arizona Project, Arizona (BE) Garrison Diversion, North Dakota (BR) Dayton, Kentucky (COB) Fulton, Illinois (COE) Red River Waterway, Louisiana (COB) Tennessee-Tonbigbee Waterway, Alabama and Mississippi (COE) Tyrone, Pennsylvania (COB) Bear Creek, Alabana and Mississippi (TVA) IB78073 Aodifieerien Cost to Complete Original Pl l§_2i;li2nL 282.8 186.3 687.6 1,280.3 329.5: s2,a73.u an UPDATE-07/14/80 Estinated Due to Modification .(§-2illi.<2n_). 2fl.0 135.0 659.8 333.0 39.2.-.9 $1,u52.3 Federal Cost l§-nilli92L 7.2 12.0 815.9 1,14fl.4 27.5 22.4 CBS-11 IB78073 UPDATE-O7/14/80 Twenty-six environmental groups, speaking through an umbrella organization called the Coalition fort Water Project Review, called the President's recommendations "reasonable and well balanced." Congressional reaction was initially somewhat favorable since the President's recommendations came less than a week after 7Q members had urged him in a letter to "trim the waste of tax dollars on unnecessary water projects." However, opposition soon began to mount when Hembers saw the impact of the "hit list" on their states and regions. on Apr. 27, 1977, the House of Representatives rejected, 143 to 252, the Emery/Miller amendment to its budget resolution (House Concurrent Resolution 195) that would have cut $100 million for water projects from the budget ceiling for the next fiscal year. The amendment's rejection came after President Carter had reduced the projects he wanted halted from 32 to 18 halts and five modifications. While the proposed 18 deletions would have cut $177.4 million from the budget, the Emery/Miller amendment would have cut only $100 million. A 9 Consideration of the 1978 Public Works Appropriations Bill (H.R. 7553, P.L. 95-96) echoed the results of the Emery/Miller effort to amend the budget resolution. Representatives Silvio Conte and Butler Derrick offered an amendment to the public works appropriations bill that would have halted 16 of the water projects the President wanted stopped. The House narrowly defeated the amendment 19H to 218. The final version of the House bill appropriated money for 17 of the 18 public works water projects the President wanted Congress to halt. The Senate version of the bill, and the final version of the bill enacted into P.L. 95-96 on Aug. 7, 1977, included funding for 9 of the water projects the President wanted stopped; funding for a tenth -- the Auburn Dam in California -- was authorized, pending the satisfactory outcome of a safety analysis of earthquake potential in the area. Before final agreement various amendments had been introduced and defeated: an amendment to delete funding for 7 of the 9 projects finally agreed upon by the Senate for continued funding; an amendment to provide money for 8 projects included in the House bill but not in the Senate bill; and an amendment to continue all the projects on the President's deletion list. Consideration of P.L. 95-H82 -- the 1979 Public Works Appropriations Act -- reopened the funding controversy of those projects whose funding had been discontinued in the 1978 Public Works Appropriations Act. As reported out of Committee, the bill contained funding for 41 water project starts. Eight of these were projects the President recommended be deleted, while five were those the President had sanctioned as worthy projects. In the congressional debate on the bill, one of the focal issues was the choice of projects to be funded. The Administration pledged to "uneguivocably fight,“ any attempt to revive those projects recommended for deletion and where no funding had been provided for FY78. In a June 12, 1978 communication to the Congress, the ,President stated, "I am particularly concerned about the restoration of eight unsound water projects the Congress agreed to halt last year." Congressional proponents of reviving these projects, on the other hand, pointed to the language in the conference report (H.Rept. 95-507, page 37) of P.L. 95-96 (H.R. 7553), which stated the case for congressional selection of water resource projects. The conferees are agreed that the Congress retains the right to select water resource -projects for funding. 9 cns-12 137 so 73 UPDATE-0 7/1u_/so All authorized water resource projects will be considered on their merits and each and every authorized project will be considered by the committees in the deliberations on the 1979 appropriation bill. The elimination of funding for certain ongoing projects and the issue of no new construction starts is a policy applied only to the 1978 appropriations. Q An amendment introduced by Rep. Robert Edgar to drop funding for those ‘H eight projects the President wanted deleted was defeated by a vote of 230 to 142. The House passed the bill with the eight projects reactivated. As reported out of conference, the bill proposed funing for 56 new project starts, but recanted somewhat on the original position of continued funding of eight projects the President wanted discontinued. Of these eight i~ projects, the conferees recommended discontinuation of funding of two -- La Farge Lake in Wisconsin and ueramec Park Lake in Missouri. For the remaining six, the conferees recommended continued funding for study purposes of three -- Fruitland Mesa in Colorado, Savery—Pot Hook in Colorado, and Lukfata Lake in Oklahoma - and continued ggnstgggtign funding of the other three - the Narrows Unit in Colorado, Yatesville Lake in Kentucky, and Bayou Bodcau in Louisiana. President Carter vetoed the bill on Oct. 5, 1978. In his message to Congress (House Document 95-393), the President stated that the "bill would hamper the Nation's ability to control inflation, eliminate waste, and make ;. the government more efficient." The message contained five specificl ‘ objections to the bill: ~ 1- Funding is reinstated for six unsound water projects (described in the previous paragraph). These six projects/would cost $580 million to complete. 2. The bill commits the Federal government to excessive new water project construction starts. The bill provides for 27 new project starts. 3. The Federal bureaucracy would be enlarged substantially and unnecessarily through the hiring of an additional 2300 employees for the Corps of Engineers and the Bureau of Reclamation. 4. True costs of the bill far exceed the amounts appropriated. In making a relatively small commitment of $103.6 million for new project starts, the actual commitment in total expenditures is $1.8 billion. 5. By eliminating funding for the Water Resources Council, the bill would seriously impair efforts to better coordinate water resources programs. On the same day, the Congress sustained the veto by what the Environmental Study Conference has termed a "surprisingly large margin" of 223 to 190. Congress then amended an existing joint resolution (H.J.Res. 1139), which was ‘~ then sent to the President, who signed the measure on October 18. The joint CR5-13 IB78073 UPDATE-07/14/80 resolution amendment and the law contained the following: 1. Removal of six contested projects from the vetoed hill. 2. Funding of eleven new construction starts opposed by the Administration. 3. Continued funding of the Water Resources Council. The congressional interest in authorizing more water projects than the Administration might want has become linked to another long standing controversy involving user charges for waterways. (See Issue Brief 77012.) The bill included authorization for the revamping of Lock and Dan 26 on the Mississippi River near Alton, Illinois, and provided for a Auser charge for Ainland waterway development. Since the House considered the Senate bill a revenue-raising measure, and all revenue-raising measures according to the Constitution must originate in the House, it shelved S. 790. The House then developed its own bill, H.R. 8309 -— the Navigation Development Act -- which would impose a tax on the diesel fuel purchased by waterway commercial craft. H.R. 13059 -- the Water Resources Development Act of 1978 —— coupled the language of H.R. 8309 with the authorization for the planning and development of 33 projects. However, in the last days of the 95th Congress, the Lock and Dam 26/waterway toll bill was separated from the new project authorizations contained in H.R. 13059 and was attached to a minor revenue measure (H.R. 8533). 1.’X-12l2._§£§. F1111 1_’\1ndi11SI President Carter's January 1978 budget proposal for FY79 contained the philosophy of applying the concept of full funding to water resources development. Applied to water resources development, full funding would discard the incremental funding system traditionally used by Congress, where a small amount of money is applied to a large number of projects. Instead, full funding would finance, in one lump sun, all projects to completion. Soon after sending the President's Federal Water Policy Initiatives to Congress, the Administration proposed amendments to the January budget proposal, recommending full.funding of new construction starts and advanced engineering and design studies. The President requested FY79 budget authority for $717.9 million, with 1979 outlays of $68.2 million. These amounts included full funding of 26 water project starts for the Corps of Engineers and the Bureau of Reclamation, and 25 small watershed project starts for the Soil Conservation Service. (See table II.) Also included in this amount were 10 advanced engineering and design starts for the Corps of Engineers. cns-14 1373073 UPDATE-07/14/80 TABLE II: Presidential Recommendation for Water Project Planning and Construction Starts for FY79 Elan ins §E§£E§ Constrgstien §ta£2§ Corps of Engineers: Ardsley, N.Y. Barbers Point Harbor, Hawaii Bassett Creek, Minn. Big South Fork, Ky., Tenn. chaska, Minn. Blue River Channel, Mo. Chicagoland Underflou Plan, 111. Hartwell Lake, Ba. and S.C. Goleta and Vicinity, Calif. Honolulu Harbor, Hawaii Kahona Stream, Hawaii Hoonah Harbor, Alaska Placer Creek, Idaho iL.A., Long Beach, Calif. Ponce Harbor, Puerto Rico L. Snake River, 0reg., Wash. San Juan Harbor, Puerto Rico Metlakatla Harbor, Alaska Hillapa River at Raymond, Hash. Milan, Ill. ’ North Nashua River, Mass. Point Place, Toledo, Ohio Port Everglades Harbor, Fla. Prairie du Chien, Wis. St. Lucie Inlet, Fla. Two Harbors, Minn. Winona, Minn. Bureau of Reclamation: Oroville-Tonasket Unit, Chief Joseph Dan Project, Hash. Glen-Colusa Irrigation District, Calif. Hidalgo and Willacy Counties, Tex. Overland Ditch and Reservoir Co., Colo. Hildago County Water Improvement, Tex. Pleasant Valley County Water Dist., Calif. Rainbow Mun. Water Dist., Calif. South Weber Water Improwenent Dist., Utah West Bench Irrigation Dist., Mont. Soil Conservation Service: (25 new construction starts) CBS-15 IB78073 UPDATE-07/14/80 Despite the President's June 13 budget request, the 1979 Public Works Appropriations Bill (H.R. 12928) contained incremental funding for water project starts. The House Budget Committee report accompanying the First Budget Resolution endorsed the President's proposal of full funding and also f- urged the House to embrace the concept. According to the House Budget 7 Committee, if the Q1 new construction starts contained in H.R. 12928 were fully funded, the total budget authority would have to be $1.3 billion as — compared to the $65 million incremental funding contained in H.R. 12928. Activities 2: 2 e 9622 Qengreee Most of the activity in the 96th Congress concerning water projects has focused on the restructuring of the NRC to include an independent review board, ¢ost sharing for Federal water projects and debate on controversial water projects in the traditional authorization and appropriations bills. President Carter's Executive Orders 12113 and 12141 dated Jan. 4 and June 5, respectively, directed the NRC to insure that an impartial technical review was performed for Federal project pre-authorization proposals and pre-construction plans. If the Orders are implemented, it will be mandatory Z= for agencies to submit project plans to WRC for review. The plans would then be forwarded to the Office of Management and Budget accompanied by a [. statement of findings by HRC. The Administration forwarded two proposals for v the restructuring of the WRC. The first proposal, introduced in the Senate (S. 480) by request, contained a provision to authorize the independent review function, as well as a provision to extend for 2 years wRC's administrative and river basin functions. The second proposal, also introduced in the Senate (8. 833) by request, would expand the WRC's existing State grant programs for water management from $3 million to $25 million annually, and would establish another annual grant program of $25 million to assist the States in implementing water conservation technical assistance. The 96th Congress has not been receptive to the idea of the independent review function. The House Appropriations Energy and Water Development Subcommittee chairman refused to consider a request by WRC for reprogramming is $431,000 in available funds for 33 additional persons to carry out the WRC's independent water project review function. The chairman cited concerns expressed to him by the House Public works and Transportation Committee that ‘« "Congress has never explicitly authorized the President to require WRC to perform such an ‘independent’ review," and such actions may "constitute an Executive Department reorganization which does not comply" with the ~ Reorganization Act of 1977. Senate Resolution 83, introduced Mar. 1, 1979, expressed the Senate's desire that water policies developed by the Executive receive full congressional review. Opportunity for congressional review of ‘ wthe independent review function for IRC came during hearings held Apr. 2, 1979, before the Senate Committee on Environment and Public works Subcommittee on Water Resources. when asked how WRC could implement the independent review function if it shared the same chief with the proposed Department of Natural Resources, Interior's Assistant Secretary Guy Martin responded that the independent review was not a policy review, but rather a echnical review, and that ranking or limiting the number of projects approved would not occur. Questions were also raised concerning the possible overlapping of functions between the independent review function of the WRC M and similar roles performed by the Corps of Engineers and the Office of CBS-16 IB78073 UPDATE—07/1n/80 nanagement and Budget. P.L. 96-69 (H.R. 4388), contained $38.6 million for the FY80 funding of the Water Resources Council, but none of these funds may be used to finance the independent review function unless this function is specifically ,0 authroized in other legislation. Authorizing ‘legislation for the WRC is contained in S. #80 and H.R. 2610. S. 480 passed the Senate in September, but contained an amendment that no funds appropriated for the measure could 0 «the used for the independent review function. The bill did, however, authorize $25 million for each of fiscal years 1980, 1981, and 1982 for water management grant programs to the States on a 50% matching basis, and $10 million for a State matching grant program for water conservation technical is assistance. H.R. 2610 contains similar prowisions for State water management and conservation technical assistance programs, except funds are authorized only for FY80 and the amount includes only $10 million for the State water it management program and $10 million for the State water conservation program. The authorization bills in the 96th Congress are H.R. H788 on the House side and S. 703 on the Senate side. Both bills as introduced were not in keeping with Administration goals for water policy reform. The Administration faults the bills because they contain instances where projects are authorized without the completion of the necessary reviews. In a letter to the House Speaker, the Interior Secretary and the Army Secretary stated that the House bill "would authorize numerous projects which have been found not to have, or for which there has been no demonstration of, economic feasibility. Hany of the projects which would be authorized have not been ‘« reviewed by the concerned Federal agencies, some lack agency reports, let alone full review of those reports by the Executive Branch." The Administration found 100 projects and provisions in the bill objectionable. The water projects appropriation legislation in the 96th Congress includesh P.L. 96-69(H.R. 4388) in the first session and H.R. 7590 in the second session. A controversial feature of H.R. 7590 as passed by the House is the ’- allocation of $225. million for construction of the Tennessee Tombigbee waterway- The bill does not include funds for new water project construction starts because of a threatened White House veto. Other bills have been introduced in the 96th Congress which do not deal directly with the independent review function but rather deal with the issue A of independency of the HRC. S. 1241 provides that WRC be comprised of the Secretaries of the Army, Interior, Agriculture and the Administrator of _the Environmental Protection Agency. The President would then choose five additional members with the advice and consent of the Senate. The President would select the Chairman of the Council from these five. 5. 1639 would have WRC comprised of full and associate members. The full members would again be w~ the secretaries of the Army, Interior, Agriculture, and the Administrator of EPA. The five associate members would be the Secretaries of Commerce, Energy, Transportation, the Director of the Federal Emergency Management 9 Agency, and the Chairman of the State Advisory Board. The Chairman of the state Advisory Board would be appointed from persons recommended by the National Governors‘ Association. The Chairman of HRC itself would be l aappointed by the President with the advice and consent of the Senate. Another issue receiving much congressional attention in the 96th Congress F7 is State and non—Federal cost-sharing in Federal water projects. The principal bill in this regard is S. 12u1. The bill establishes a su billioz construction fund for the Federal share of projects chosen for construction 8 from State priority lists. States are required to cost-share in these CBS-17 IEfl8073 UPDATE-O7/10/80 projects -- 25% for construction costs and 50% for operation for operation and maintenance costs. The formula for allocation of the $0 billion construction fund will be based primarily on the population and the area of the States. Along with the new initiatives in re-structuring the NRC and implementing 1a new Federal/State cost-sharing scheme are the traditional water resources development authorization and appropriations legislation. Throughout the A enactment process of P.L. 96-69, the water projects appropriations bill for the first session, the President did not recommend that any new projects be deleted. Although urged by environmental groups to veto the appropriations bill because it provided funding for the controversial Tellico Dam, the President signed the measure into law. The Act provided funds for the continued planning of the Dickey-Lincoln project (see CRS Report No. 79-190) and the construction of the Yatesville Lake and Bayou Bodcau projects. The appropriations law did not implement the full funding concept for water projects, but rather continued the incremental funding concept. The Act contained $34.6 million for the FY80 funding of the Water Resources Council, $2.8 billion for the Corps of Engineers to finance 19 new and 227 continuing construction projects, and $607 million for the Bureau of Reclamation to finance 7 new and 93 continuing construction projects. In the debate on the budget for FY81, 82, and 83, Senator Cohen offered an amendment to Senate Concurrent Resolution 86 which would have reduced the budget authority and outlays for water resources projects $500 million below the levels recommended in the Resolution. Senator noynihan offered a substitute amendment which would have transferred the half billion dollar reduction proposed by the Cohen amendment to the general revenue sharing nrogram, which at the time faced a 25% cut in funding. Both the substitute Aoynihan amendment and~the underlying Cohen amendment were defeated, 54 to L§§l§LA$l9E P.L. 96-69 (H.R. H388) First session water project appropriations for Corps of Engineers, TVA, three regional water development commissions, and the Water Resources A Council. Introduced June 7, 1979; referred to the Committee on *9 Appropriations. Reported to House (H.Rept. 96-2&3) June 7, 1979. Passed House June 18, 1979. Reported to Senate (S.Rept. 96-2&2) July 12, 1979, and passed Senate July 18, 1979. Conference report (H.Rept. 96-388) filed in House July 25, 1979. House agreed to conference report Aug. 1, 1979. On Sept. 10, 1979, the Senate receded from certain amendments to the conference report and agreed to the House amended conference report. On Sept. 25, 1979, the President signed the bill into law. H.R. 2071 (Vento) A Amends P.L. 89-80 to require that the Chairman of the Water Resources Council be appointed by the President with the advice and consent of the Senate. Introduced Feb. 8, 1979; referred to the Committee on Interior and IA Insular Affairs. H.R. 2610 (Udall) Amends P.L. 89-80 to authorize continuing appropriations for the Water Resources Council for fiscal years 1980 and 1981. Introduced Mar. 5, 1979; referred to the Committees on Interior and Insular Affairs, on Agriculture, ~ and on Public works and Transportation. Reported from Committee on Public can-13 :r.n?30?3 :r2..1..::31;--c« ?{'1_i':fi._~“3'3 Works and Transportation iH.Rept. 96-lat) on June 26, 1979; reported to House from Committee on Agriculture (H.kept. 96~In4) on June RS, 1979. H.R. H608 (Udall) Amends the Water Resources Planning Act of 1965 to broaden the coverage of the act over water and. related land resources development programs. Revises the composition of the Water Resources Council, and authorizes the Council to establish an advisory committee comprised of representatives of State and local government. Directs the Council to advise the President on water and related land resources investnents and periodically compile and compare regional funding levels for such programs. Introduced June 6, 1979; referred to more than one committee. H.R. 4788 (Roberts et a1.) water project authorization bill for Corps of Engineers projects. Provides for congressional veto of water hesource development rules and regulations. Terminates specified projects. Introduced July 13, 1979; referred to Committee on Public works and Transportation. Reported {H.Rept. 96-598) with amendment Oct. 10, 1979. Measure passed House Feb. 5, 1989. H.R. 7590 second session water project appropriations bill for water development agencies. Introduced June 16, 1980. Reported to House (B. Bept. 96-1G??? from Committee on Appropriations. Measure passed Rouse, amended, June 25, 5. R80 (Randolph, by request) Amends the 1965 Water Resources Planning Act to extend for 2 years the Water Resources Council authorization for administrative and river hasin functions. Includes a provision for the establishment of the independent water project review function within the Water Resources Council. Introduced Feb. 26, 1979; referred to Committee on Public Works. deasure passed Senate, amended, Sept" 20, 1979., S. 833 (Randolph, by request) Amends the 1965 Water Resources Planning Act to expand the Counci:’s ‘ existing State program for water Ianagenent from $3 millian annually to £25 million annually, and would establish another grant program to $25 million annually to assist States in implementing water conservation technical assistance. Introduced Mar. 29, 1979; referred to Committee on Environment and Public Works. 5. 1241 ironenici) Provides for Federal/State cooperation concerning water resources development, with the Rater Resources Council serving as the Federal coordinator. Establishes a $fl billion construction fund for the Federal share of projects chosen for construction from State priority lists. States are required to cost-share in these projects ~- 25% for construction costs and 53% of operation and maintenance costs. Amends the 1965 Water Resourcws Planning Act to establish an independent Eater Resources Ccuncil, to composed cf the Secretaries of the Army, Interior, Agriculture, the Administrator of the Bnvironnental Protection Agency, and five members ChGSsE by the President with the advice and consent oi the Senate. The chairman of the Council shall be selected from these five members by the President. Introduced May 24, 1979; referred to Committee on Environment and Public Works. 1,‘ A9 1 S. 1639 (Gravel) ca s-=19 LLB? so 73 (nan-n1~::-o "1,rm,zao Amends the 1965 Eater Resources ?lanning Act to change the structure of the Water Resources Council. The Council would be ccmprisefi of five full members and five asssciate members. The full members would be the Secretaries of Agriculture, the Army, Interior, the Administrator of the Environmental Protection Agency: and the Chairman. The Chairman woulfl be appointed by the President with the advice and consent of the Senate. The five associate neabers voulé be the Secretaries of Commerce, Energy, Transportation, the Director of the Federal Emergency management Agency, and the Chairman of the State Advisory Committee. Introduced Aug. 2, @979; referrei to Conmittee on Environment anfi Public Works. U.S. Congress. House. Committee on the Buaget. Task Force on Budget Process. Full fnnfiing of capital enpenditures. Hearings, 95th Congress, Zfi session. Feb. 22, 1978. Washington, 0.3. Govt. Print. Off., 1978. 73 9. 0.3. Congress. House. Committee on Appropriations. Subcommittee on Public Works. Public works for water and power fleveiopment and energy research appropriation bill, I979. hearings, 95th Congress, RE session. Hashington, U.s. Govt. Print. 0ft,, 1977. U.S. Congress. Senate. Committee on Appropriations. Hearings on public works for water anfl power development and energy_ appropriations for FY73 (H.k. 7553). 95th Congress, 1st session. Washington, 0.3. sovt. Print. Off., 8977. ._; _ _.,1:'.I2-.C£££.1!£-3-.2:§§§'-iQ1!éL-P.Q£3§;!E!vZ12§ 0.3. Congress. House. connittee on Appropriations. A report to accompany H.R. 12928. 143 p. Eashinqtan. 0.5. Govt. Print. Off., 1977. (95th Congress. 2d session. House. Report no. 95-1247} ~~~~~ A report to accompany 3.3. 7553. Washington, 0.5. Govt. Print. Gffi., 1977. (95th Congress, Est session. House. leport no. 95~507) ----~ A report to accompany H.R. 7553. Washington, U.S. Govt. Print. Off., 1977. (95th Congress, .st session. House. Report no. 95~379) U.S. Congress. Senate. Committee on Appropriations. A report to acoonpany H.R. 7553. Washington, fl.S. Govt. Print. Off., I977. (95th Congress, 1st session. Senate. Report no. 95-301) 05/O7/80 -~ Defeat of amendment to Senate Concurrent Resolution 86 which would have reducefi Peaeral outlays foe water projects by onevhalf billion dollars. OH/in/80 —~ Water Resources Council published new rules cn 12/14/79 09/25/79 01/OH/79 10/18/78 10/15/78 1o/1n/78 10/05/78 08/10/78 07/12/78 06/16/78 06/15/78 06/13/78 06/06/78 08/07/77 07/25/77 CBS-20 IB78073 UPDATE-07/1H/80 calculating environmental quality benefits and costs. Water Resources Council published final rules on calculating national economic development benefits and costs. President Carter signed intoalaw P.L. 96-69 (H.R. #388), which provided construction funds for the Tellico Dam, but no funds for the independent review function of the Water Resources Council unless this function was specifically authorized by other legislation. Executive Order 12113 directed Water Resources Council to ensure that impartial technical review is performed on water projects. R P.L. 95—u82 (H.J.Res. 1139) enacted. H.J.Res. 1139, as amended by the Senate, passed by House. Senate amended H.J.Res. 1139 to include agreement reached between the Administration and Congress on funding of existing and new projects, increased staffing of the Corps of Engineers and the Bureau of Reclamation, and continued funding for the Water Resources Council. Congress sustained President's veto of H.R. 12928 by 223 to 190. President vetoed H.R. 12928 and sent veto message (House Document 95-393) to Congress. H.R. 12928 passed Senate. President Carter issued memoranda to executive agencies to carry out the new national water consideration policy announced June 6. H.R. 12928 passed House. House defeated an amendment to H.R. 12928 to not fund eight projects that the President wanted stopped. President Carter submitted to the Senate proposed amendments to the request for appropriations for the fiscal year 1979 for water resources projects (Senate Document 95-109). President Carter presented his Federal Hater Policy Initiatives to Congress. 7 P.L. 95-96 (H.R. 7553) enacted. Included funding for 9 water projects that President Carter wanted deleted. Water Resources Council pronmlgated "Issues and Options CBS-21 Papers” in the zederal .13egi§t..er O7/15/77 Papers" in the Federal.Reg;§tg;: 05/23/77 IB78073 upmrn-07,/1n/so water Resources Council promulgated “Issues and Options President Carter sent his Environmental uessage to Congress, asking for the development of a water resources management policy. on/27/77 House of Representatives rejected an amendment to a budget resolution to cut $100 million for water projects from budget ceiling . 04/18/77 Carter Administration issued statement on 32 controversial water projects, recommending 18 for deletion, 5 for modification, and 9 for continued funding. 09/10/73 Water Resources Council promulgated in Fedgg§;_§gg;§§g; "Principles and Standards for Planning water and Related Land Resources." 12/21/71 Water Resources Council promulgated in §gQ§;al_§ggi§§gr for public comment “Proposed Principles and Standards for Planning Water and Related Land Resources." objectives proposed. 12/31/70 River and Harbor Flood Control Act Three evaluation (P.L. 91-611) of 1970 proposed four evaluation objectives. 01/01/70 Enactment of the National Environmental Policy Act (P.L. 91-190), which requires the evaluation of the short- and long-term environmental consequences of Federal projects in environmental impact statements. 07/22/65 2.12.I.TI !AL..§.§.1‘.'§fl.1!-§_§QflQE5 0.3. General Accounting Office. analysis for water resources projects. (ED-78-127) Enactment of the water Resources Planning Act of An overview of benefit-cost Aug. 7, 1978. 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