Corps of Engineers
Observations on Planning and Project Management Processes for the Civil Works Program Gao ID: GAO-06-529T March 15, 2006Through the Civil Works Program, the Corps of Engineers (Corps) constructs, operates, and maintains thousands of civil works projects across the United States. The Corps uses a two-phase study process to help inform congressional decision makers about civil works projects and determine if they warrant federal investment. As part of the process for deciding to proceed with a project, the Corps analyzes and documents that the costs of constructing a project are outweighed by the benefits. To conduct activities within its civil works portfolio, the Corps received over $5 billion annually for fiscal years 2005 and 2006. During the last 4 years, GAO has issued five reports relating to the Corps' Civil Works Program. Four of these reports focused on the planning studies for specific Corps' projects or actions, which included a review of the cost and benefit analyses used to support the project decisions. The fifth report focused on the Corps management of its civil works appropriation accounts. For this statement, GAO was asked to summarize the key themes from these five studies. GAO made recommendations in the five reports cited in this testimony. The Corps generally agreed with and has taken or is taking corrective action to respond to these recommendations. GAO is not making new recommendations in this testimony.
GAO's recent reviews of four Corps civil works projects and actions found that the planning studies conducted by the Corps to support these activities were fraught with errors, mistakes, and miscalculations, and used invalid assumptions and outdated data. Generally, GAO found that the Corps' studies understated costs and overstated benefits, and therefore did not provide a reasonable basis for decision-making. For example: (1) for the Delaware Deepening Project, GAO found credible support for only about $13.3 million a year in project benefits compared with the $40.1 million a year claimed in the Corps' analysis; (2) for the Oregon Inlet Jetty Project, GAO's analysis determined that if the Corps had incorporated more current data into its analysis, benefits would have been reduced by about 90 percent; and (3) similarly, for the Sacramento Flood Control Project, GAO determined that the Corps overstated the number of properties protected by about 20 percent and used an inappropriate methodology to calculate the value of these protected properties. In addition, the Corps' three-tiered internal review process did not detect the problems GAO uncovered during its reviews of these analyses, raising concerns about the adequacy of the Corps' internal reviews. The agency agreed with GAO's findings in each of the four reviews. For three projects the Corps has completed a reanalysis to correct errors or is in the process of doing so; it decided not to proceed with the fourth project. GAO's review of how the Corps manages its appropriations for the civil works program found that instead of an effective and fiscally prudent financial planning, management, and priority-setting system, the Corps relies on reprogramming funds as needed. While this just-in-time reprogramming approach can provide funds rapidly to projects that have unexpected needs, it has also resulted in many unnecessary and uncoordinated movements of funds, sometimes for reasons that were inconsistent with the Corps' own guidance. Because reprogramming has become the normal way of doing business at the Corps, it has increased the Corps' administrative burden for processing and tracking such a large number of fund movements. For example, in fiscal years 2003 through 2004 the Corps moved over $2.1 billion through over 7,000 reprogramming actions. In response to GAO's findings, the Congress directed the Corps to revise its procedures for managing its civil works appropriations, starting in fiscal year 2006, to reduce the number of reprogramming actions and institute more rational financial discipline for the program.
GAO-06-529T, Corps of Engineers: Observations on Planning and Project Management Processes for the Civil Works Program
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Testimony:
Before the Subcommittee on Energy and Resources, Committee on
Government Reform, House of Representatives:
United States Government Accountability Office:
GAO:
For Release on Delivery Expected at 2:00 p.m. EST:
Wednesday, March 15, 2006:
Corps of Engineers:
Observations on Planning and Project Management Processes for the Civil
Works Program:
Statement of Anu Mittal, Director:
Natural Resources and Environment:
GAO-06-529T:
GAO Highlights:
Highlights of GAO-06-529T, a testimony before the Subcommittee on
Energy and Resources, Committee on Government Reform, House of
Representatives:
Why GAO Did This Study:
Through the Civil Works Program, the Corps of Engineers (Corps)
constructs, operates, and maintains thousands of civil works projects
across the United States. The Corps uses a two-phase study process to
help inform congressional decision makers about civil works projects
and determine if they warrant federal investment. As part of the
process for deciding to proceed with a project, the Corps analyzes and
documents that the costs of constructing a project are outweighed by
the benefits. To conduct activities within its civil works portfolio,
the Corps received over $5 billion annually for fiscal years 2005 and
2006.
During the last 4 years, GAO has issued five reports relating to the
Corps‘ Civil Works Program. Four of these reports focused on the
planning studies for specific Corps‘ projects or actions, which
included a review of the cost and benefit analyses used to support the
project decisions. The fifth report focused on the Corps management of
its civil works appropriation accounts. For this statement, GAO was
asked to summarize the key themes from these five studies.
GAO made recommendations in the five reports cited in this testimony.
The Corps generally agreed with and has taken or is taking corrective
action to respond to these recommendations. GAO is not making new
recommendations in this testimony.
What GAO Found:
GAO‘s recent reviews of four Corps civil works projects and actions
found that the planning studies conducted by the Corps to support these
activities were fraught with errors, mistakes, and miscalculations, and
used invalid assumptions and outdated data. Generally, GAO found that
the Corps‘ studies understated costs and overstated benefits, and
therefore did not provide a reasonable basis for decision-making. For
example:
* For the Delaware Deepening Project, GAO found credible support for
only about $13.3 million a year in project benefits compared with the
$40.1 million a year claimed in the Corps‘ analysis.
* For the Oregon Inlet Jetty Project, GAO‘s analysis determined that if
the Corps had incorporated more current data into its analysis,
benefits would have been reduced by about 90 percent.
* Similarly, for the Sacramento Flood Control Project, GAO determined
that the Corps overstated the number of properties protected by about
20 percent and used an inappropriate methodology to calculate the value
of these protected properties.
In addition, the Corps‘ three-tiered internal review process did not
detect the problems GAO uncovered during its reviews of these analyses,
raising concerns about the adequacy of the Corps‘ internal reviews. The
agency agreed with GAO‘s findings in each of the four reviews. For
three projects the Corps has completed a reanalysis to correct errors
or is in the process of doing so; it decided not to proceed with the
fourth project.
GAO‘s review of how the Corps manages its appropriations for the civil
works program found that instead of an effective and fiscally prudent
financial planning, management, and priority-setting system, the Corps
relies on reprogramming funds as needed. While this just-in-time
reprogramming approach can provide funds rapidly to projects that have
unexpected needs, it has also resulted in many unnecessary and
uncoordinated movements of funds, sometimes for reasons that were
inconsistent with the Corps‘ own guidance. Because reprogramming has
become the normal way of doing business at the Corps, it has increased
the Corps‘ administrative burden for processing and tracking such a
large number of fund movements. For example, in fiscal years 2003
through 2004 the Corps moved over $2.1 billion through over 7,000
reprogramming actions. In response to GAO‘s findings, the Congress
directed the Corps to revise its procedures for managing its civil
works appropriations, starting in fiscal year 2006, to reduce the
number of reprogramming actions and institute more rational financial
discipline for the program.
www.gao.gov/cgi-bin/getrpt?GAO-06-529T.
To view the full product, including the scope and methodology, click on
the link above. For more information, contact Anu Mittal at (202) 512-
3841or mittala@gao.gov.
[End of section]
Mr. Chairman and Members of the Subcommittee:
We are pleased to be here today to discuss the U.S. Army Corps of
Engineers' (Corps) civil works planning and project management
processes. My testimony is based on five reports issued by GAO over the
last 4 years;[Footnote 1] it focuses on the economic, or cost benefit,
analyses used to support decisions on specific civil works projects and
actions and the Corps lack of effective planning and project management
processes for its civil works appropriations. As you know, the Corps is
the federal agency responsible for designing, constructing, operating,
and maintaining thousands of civil works projects across the United
States. These projects historically involved navigation and flood
control activities but have more recently been expanded to include
ecosystem restoration efforts. The Corps follows a two-phase study
process to help inform congressional decision makers about civil works
projects and determine if they warrant federal investment. As part of
the process of deciding to proceed with a project, the Corps analyzes
and documents that the costs of constructing a project are outweighed
by the benefits provided by the project. Although there has been an
overall decline in federal funding for water resource development
projects during the last three decades, over $5 billion was
appropriated for the Corps' civil works program in both fiscal years
2005 and 2006.
In summary we found that:
* the cost and benefit analyses performed by the Corps to support
decisions on Civil Works projects or actions were generally inadequate
to provide a reasonable basis for deciding whether to proceed with the
project or action, and:
* the Corps' practice of conducting thousands of reprogrammings
resulted in movements of project funds that were not necessary and that
reflected poor planning and an absence of Corps-wide priorities for its
Civil Works portfolio.
Background:
The Corps' Civil Works program is responsible for investigating,
developing, and maintaining the nation's water and related
environmental resources. In addition, the Civil Works program provides
disaster response as well as engineering and technical services. The
Corps' headquarters is located in Washington, D.C., with eight regional
divisions and 38 districts that carry out its domestic civil works
responsibilities.
Each year, the Corps' Civil Works program receives funding through the
Energy and Water Development Appropriations Act. The act normally
specifies a total sum for several different appropriation accounts,
including investigations, construction, and operation and maintenance,
to fund projects related to the nation's water resources. The funds
appropriated to the Corps are "no year" funds, which means that they
remain available to the Corps until spent. The conference report
accompanying the Energy and Water Development Appropriations Act
specifically lists individual investigations, construction, and
operation and maintenance projects and the amount of funds designated
for each project. In effect, the conference report provides the Corps
with its priorities for accomplishing its water resource projects.
Corps' Process for Developing Water Resource Projects:
In general, the Corps becomes involved in water resource projects when
a local community perceives a need and contacts the Corps for
assistance. If the Corps does not have the statutory authority required
for the project, the Congress must provide authorization. After
receiving authorization, generally through a committee resolution or
legislation and an appropriation, a Corps district office conducts a
preliminary study on how the problem could be addressed and whether
further study is warranted.
When further study is warranted, the Corps typically seeks agreement
from the local sponsor to share costs for a feasibility study. The
Congress may appropriate funds for the feasibility study, which
includes an economic analysis that examines the costs and benefits of
the project or action. The local Corps district office conducts the
feasibility study that is subject to review by the Corps' division and
headquarters offices. The feasibility study makes recommendations on
whether the project is worth pursuing and how the problem should be
addressed. The Corps also conducts needed environmental studies and
obtains public comment on them. After those are considered, the Chief
of Engineers transmits the final feasibility and environmental studies
to the Congress through the Assistant Secretary of the Army for Civil
Works and the Office of Management and Budget. The Congress may
authorize the project's construction in a Water Resources Development
Act or other legislation. Once the project has been authorized and
after the Congress appropriates funds, construction can begin. Figure 1
shows the major steps in developing a civil works project.
Figure 1: Major Steps in Developing a Civil Works Project:
[See PDF for image]
[End of figure]
Reprogramming Authority:
Reprogramming is the shifting of funds from one project or program to
another within an appropriation or fund account for purposes other than
those contemplated at the time of appropriation. A reprogramming
transaction changes the amount of funds provided to at least two
projects-the donor project and the recipient project. However, more
than two projects are often involved in a single reprogramming action.
For example, in an effort to make effective use of available funding,
the Corps may move funds from a construction project that has slipped
due to inclement weather and reprogram the funds to one or more
construction projects that are ahead of schedule or experiencing cost
overruns.
The authority to reprogram funds is implicit in an agency's
responsibility to manage its funds; no specific additional statutory
authority is necessary. While there are no government-wide
reprogramming guidelines, the Congress exercises control over an
agency's spending flexibility by providing guidelines, or non-statutory
instructions, on reprogramming in a variety of ways. For example, some
reprogramming and reporting guidelines have evolved from informal
agreements between various agencies and their congressional oversight
committees.
The Corps' Cost and Benefit Analyses Were Inadequate to Support
Decision-Making:
Our review of four Civil Works projects or actions found that the cost
and benefit analyses the Corps used to support these actions were
fraught with errors, mistakes, and miscalculations, and used invalid
assumptions and outdated data. The Corps' analyses often understated
costs and overstated benefits. As such, we concluded that they did not
provide a reasonable basis for decision-making. In two instances, we
also found that the Corps' three-tiered review process, consisting of
district, division, and headquarter reviews, did not detect the
problems we uncovered. These instances raised concerns about the
adequacy of the Corps' internal reviews.
Delaware River Deepening Project:
Our review of the Corps' cost and benefit analysis of the Delaware
River channel-deepening project found that it contained a number of
material errors. For example, the Corps misapplied commodity rate
projections, miscalculated trade route distances, and included benefits
for some import and export traffic that had seriously declined over the
last decade. As a result, the Corps' estimate of project benefits was
substantially overstated. We found that project benefits for which
there was credible support were about $13.3 million a year compared
with the $40.1 million a year claimed by the Corps' 1998 report.
Specifically, we found that the Corps significantly overestimated the
growth in oil import traffic for 1992 through 2005 because it used an
incorrect commodity growth rate for part of the period. Use of this
rate resulted in the Corps overestimating benefits by about $4.4
million. Additionally, the Corps' estimate contained a computer error
that overestimated this same benefit by another $4.7 million. Finally,
the Corps' project benefits attributed to the import and export of
commodities such as scrap metal, iron ore, and coal were overstated by
about $2.7 million.
Conversely, the Corps' cost estimate for the project contained a number
of positive and negative errors that in aggregate would have reduced
project costs slightly but not enough to make up for the significant
decrease in project benefits.
We found that the Corps' three-tiered quality control process of the
Corps, consisting of district, division, and headquarters offices, was
ineffective in detecting or correcting the significant miscalculations,
invalid assumptions, and outdated information in the cost and benefit
analysis that our review revealed.
In response to our report, the Corps conducted a reanalysis of the
project with updated, more complete information. This reanalysis
asserted that the project could be built for $56 million less than the
Corps had previously estimated. As we recommended, the Corps also had
its reanalysis reviewed by an external party.
Oregon Inlet Jetty Project:
Our review of the Oregon Inlet Jetty project found that the Corps' most
recent cost benefit analysis of the project, issued in 2001, had
several limitations, and as a result did not provide a reliable basis
for deciding whether to proceed with the project. The Corps' analysis
did not consider all alternatives to the project, used outdated data to
estimate benefits to fishing trawlers, did not account for the effects
on smaller fishing vessels, and used some incorrect and outdated data
to estimate damage and losses to fishing vessels. For example, the
Corps did not evaluate alternatives to the jetty project and 20-foot
deep channel that it proposed, although many vessels that currently use
the inlet could have benefited from a shallower and less costly channel-
deepening project. Further, the Corps used outdated data to estimate
benefits of the project to larger (75-foot long) fishing trawlers that
resulted in a significant overestimate of benefits.
We determined that if the Corps had incorporated more current data on
the actual number of trawlers that used the inlet in its analysis,
benefits would have been reduced by about 90 percent, from over $2
million annually to less than $300,000. Conversely, the Corps did not
estimate the benefit to the smaller fishing vessels that use the inlet.
However, since these vessels could have a shallower draft than the
large vessels they might not have benefited from the deeper channel and
jetty that was proposed to benefit larger vessels. Additionally, the
Corps miscalculated benefits due to a reduction in the damages that
would occur to trawlers because of accidents that occur due to the
conditions in the inlet. The Corps overestimated these benefits because
it assumed, based on anecdotal evidence, that all of the 56 commercial
fishing vessels regularly using the inlet would be damaged during the
year and would incur about $7,000 each in damages. Our review of Coast
Guard data showed that only about 10 commercial fishing vessels
actually reported damages during the time frame the Corps considered,
these damages averaged about $1,700 per year. Because of the concerns
raised by our report, the Corps, the Council on Environmental Quality,
and the Departments of Interior and Commerce mutually agreed not to
proceed with this project.
Sacramento Flood Protection Project:
Our review of the Corps' Common Features project, which is intended to
provide flood protection to the Sacramento area, found that the Corps
did not fully analyze likely cost increases or report them to the
Congress in a timely manner. The Corps also incorrectly calculated
project benefits because it overstated the number of properties
protected by about 20 percent and used an inappropriate methodology to
calculate the value of protected properties.
After a 1997 storm demonstrated vulnerabilities in the project, the
Corps substantially changed the design of the project but did not
analyze likely cost increases. Some of the design changes led to
substantial cost increases. For example, in some areas the Corps
tripled the depth from almost 20 to almost 60 feet of cutoff walls
designed to prevent seepage beneath the levees. The Corps also decided
to close gaps in the cutoff walls in areas where bridges or other
factors caused gaps. These changes added $24 million and $52 million,
respectively, to a project that was originally, in 1996, estimated to
cost $44 million. By the time the Corps reported these cost increases
to the Congress in 2002, it had already spent or planned to spend more
than double its original estimated cost of the project.
The Corps also made mistakes in estimating the benefits from this
project because in 1996 it incorrectly counted the number of properties
protected by the project by almost 20 percent and incorrectly valued
these protected properties. Although the Corps updated its benefit
estimate in 2002 to reflect new levee improvements authorized in 1999,
we found that even this reanalysis contained mistakes in estimating the
number of properties that would be protected and therefore continued to
estimate higher benefits from the project than would be warranted.
As with the Delaware River Deepening study, we found that all three
organizational review levels within the Corps reviewed and approved the
benefit analyses for this project, but these reviews did not identify
the mistakes that we found.
The Corps concurred with our report's recommendations and is working on
a General Reevaluation Report for the uncompleted portions of the
project that is due in the spring of 2007.
Restrictions on the Corps' Hopper Dredges:
In a 2000 report to the Congress, the Corps recommended that one of its
dredges remain in a reserve status and that another be added to that
status. However, we found that the Corps could not provide support for
these conclusions and that its cost and benefit analyses supporting
these conclusions had analytical shortcomings.
We also found that the Corps did not perform a comprehensive analysis
of the ready reserve program and in fact could not provide any
documentation of what analysis, if any, it had done. In addition, the
Corps' recommendation that the reserve program be continued because it
was beneficial was contradicted by evidence in the report showing that
the price the government paid for dredging was higher after a Corps
dredge was placed in reserve than before. We also questioned whether it
was prudent to add another dredge to the reserve fleet without a
comprehensive analysis in light of the fact that the dredge needed
significant repairs to remain in service, even in reserve.
We also determined that the Corps had used outdated data and used an
expired policy that could raise the government's cost estimate for
hopper dredging work. This cost estimate is pivotal in determining the
reasonableness of private contractor bids. If all bids exceed the
government estimate by more than 25 percent, the Corps may elect to
perform the work itself. Moreover, in making its estimate, the Corps
had not obtained comprehensive industry data since 1988 although it had
obtained some updated data for some cost items. In addition, the Corps
used a policy on estimating transit costs that had expired in 1994. Use
of this policy could significantly raise the estimate of transit costs
for dredging contracts. For example, in one case, using the Corps'
policy resulted in a transit cost estimate of about $480,000 as opposed
to about $100,000 if the expired policy was not used.
As a result of our review, a conference committee report directed the
Corps to report to the Appropriations Committees a detailed plan of how
it intended to rectify the issues raised in our report. On June 3,
2005, the Corps issued a revised report to the Congress on its plans
for the hopper dredge fleet.
The Corps' Reprogramming Activities Resulted in Inefficient Management
of Civil Works Program Funds:
The Corps' reprogramming guidance states that only funds surplus to
current year requirements should be a source for reprogramming and that
temporary borrowing or loaning is inconsistent with sound project
management practices and increases the Corps' administrative burden.
However, we recently reported that, over a two year period (fiscal
years 2003 through 2004), the Corps moved over $2.1 billion through
over 7,000 reprogramming actions. This movement of funds occurred
because during these two years the Corps managed its civil works
project funds using a "just-in-time" reprogramming strategy. The
purpose of this strategy was to allow for the movement of funds from
projects that did not have urgent funding needs to projects that need
funds immediately. While the just-in-time approach may have moved funds
rapidly, its implementation sometimes resulted in uncoordinated and
unnecessary movements of funds from project to project.
In our review of projects from fiscal years 2003 and 2004, we found
that funds were moved into projects, only to be subsequently revoked
because they were excess to the project's funding needs. For example,
in fiscal year 2004, 7 percent of the funds (totaling almost $154.6
million) from every non-earmarked construction project were revoked in
order to provide funding to projects designated as "national
requirements" by the Corps. The national requirements projects were a
group of projects for which Corps headquarters management had promised
to restore funding that had been revoked in previous years. However,
after the Corps moved funds into the national requirements projects,
the Corps revoked over a quarter of the funds, $38.8 million, from
these projects because they actually did not need the funds. For
example, one national requirements construction project, New York and
New Jersey Harbor, received $24.9 million. All of these funds, plus an
additional $10.3 million, were excess to the needs of the project at
the time and were subsequently reprogrammed to other projects. Corps
officials in the New York District told us that, prior to receiving the
national requirements funds they had informed Corps headquarters that
they could not use these funds.
We also found that the use of the just-in-time strategy resulted in
funds being removed from projects without considering their near-term
funding requirements, such as projects with impending studies. For
example, on August 1, 2003, the Corps revoked $85,000 from the Saw Mill
River and Tributaries investigation project in New York because the
funds were excess to the project's needs in the current year. Six weeks
later, however, on September 15, 2003, $60,000 of funding was
reprogrammed into the project because they were needed to initiate a
feasibility study. Corps documents explaining the revocation of funds
from the Saw Mill River and Tributaries project indicate that the Corps
was aware of the project's impending needs, and knew that the project
would need funds again in September 2003 to execute a feasibility
study.
Further, under the just-in-time reprogramming strategy, funds were
moved into and out of the same project on the same day as well as
numerous times within a fiscal year. Overall, 3 percent of
investigations and construction projects in fiscal year 2003 and 2
percent of investigations and construction projects in fiscal year 2004
moved funds into and out of the same project on the same day. For
example, in fiscal year 2003, the Corps used 18 separate actions to
reprogram approximately $25 million into, and about $10.5 million out
of, the Central and Southern Florida construction project, including
three separate occasions when funds were both moved into and out of the
project on the same day.
The just-in-time reprogramming strategy also moved money into and out
of projects without regard to the relative priorities of the projects.
During the period of our study, the Corps lacked a set of formal, Corps-
wide priorities for use when deciding to reprogram funds from one
project to another. Instead, according to the Chief of the Civil Works
Programs' Integration Division, during fiscal years 2003 and 2004,
reprogramming decisions were left up to the intuition of program and
project managers at the district level. While this decentralized system
might have allowed for prioritized decision-making at the district
level, when reprogramming actions occurred across districts or across
divisions, the Corps lacked any formal system of evaluation as to
whether funds were moving into or out of high-priority projects. The
lack of a Corps-wide priority system limits the Corps ability to
effectively manage its appropriations, especially in an era of scarce
funding resources when choices have to be made between competing needs
of donor and recipient projects.
Finally, the Corps' practice of allocating all funds to projects as
soon as the funds are allotted to the Corps, coupled with the
reprogramming flexibility provided to the districts, may result in an
elevated number of reprogramming actions. Typically, once the Corps
receives appropriated funds from the Congress, the Corps disperses all
of these funds directly into project accounts at the district level.
Allocating funding in this manner could result in some projects
receiving more money than they are able to spend. In some cases that we
reviewed, the Corps dispersed an entire fiscal year's worth of funding
to a project even though they knew that the project manager could not
spend all of the funding. The flexibility provided to district managers
once they receive their funding may also increase the number of
reprogramming transactions. According to some Corps program managers,
the relative ease of conducting reprogramming actions at the district
level, without the need to obtain division or headquarters approval,
creates incentives for project managers to transfer funds among
projects within the district even if it creates a greater number of
reprogramming actions. For example, when project managers have an
immediate need for funds, they may be more likely to reprogram funds
between projects within their own district, even if the donor project
has a need for funds in a few weeks or months, because Corps guidance
allows them to do so.
The Corps' reprogramming practices place a large demand on the
administrative resources of the agency. In fiscal year 2003, after
receiving their appropriated funds from the Congress, the Corps
conducted at least one reprogramming action every business day of the
fiscal year except for 4 days; after receiving its funds in fiscal year
2004, the Corps conducted at least one reprogramming action on every
business day of the fiscal year except for 14 days. Each reprogramming
action conducted requires the Corps to expend time and personnel
resources to locate donor projects, file necessary paperwork, and in
some cases obtain the approval of appropriate Corps staff and,
possibly, the Congress. In particular, locating sources of donor
funding is often a time-consuming process, as the project manager
seeking funding must wait for other project managers to acknowledge
excess funds and offer them for use on other projects.
In response to the findings in our report, the Congress directed the
Corps to revise its procedures for reprogramming of funds starting in
fiscal year 2006 to reduce the amount of reprogramming actions that
occur and would institute a more rationale financial discipline for the
Corps Civil Works appropriations accounts.
Corps' Response to GAO's Findings and Recommendations:
In all five of the reports discussed here, the Army or the Department
of Defense essentially agreed with our findings and conclusions and
agreed to take actions to address our recommendations. In some cases,
the Corps has completed the actions and in others they are underway or
planned. Of note, in 2005, the Corps amended its policy on external
review of its Civil Works decision-making documents, including cost and
benefit analyses to allow for outside review in certain cases.
Specifically, according to the Corps' revised policy, external peer
review of such documents will take place where the "risk and magnitude
of the proposed project are such that a critical examination by a
qualified person or team outside of the Corps and not involved in the
day-to-day production of a technical product is necessary." In
addition, the Corps has reported that it has undertaken a number of
other improvements, including (1) updating and clarifying its project
study planning guidance, (2) establishing communities of practice to
foster technical competence and share knowledge among individuals who
have a common functional skill, and (3) reorganizing to foster
integrated teamwork and streamline the project review and approval
process.
In closing, Mr. Chairman, we have found that the Corps' track record
for providing reliable information that can be used by decision makers
to assess the merits of specific Civil Works projects and for managing
its appropriations for approved projects is spotty, at best. The
recurring themes throughout the five studies that are highlighted in
our testimony clearly indicate that the Corps' planning and project
management processes cannot ensure that national priorities are
appropriately established across the hundreds of civil works projects
that are competing for scarce federal resources. While we are
encouraged that the Corps and/or the Congress have addressed or are in
the process of addressing many of the issues we have identified
relating to these individual projects, we remain concerned about the
extent to which these problems are systemic in nature and therefore
prevalent throughout the Corps' Civil Works portfolio. Effectively
addressing these issues may therefore require a more global and
comprehensive revamping of the Corps' planning and project management
processes rather than a piecemeal approach.
This concludes my prepared statement, Mr. Chairman. I would be happy to
respond to any question that you or Members of the Subcommittee may
have.
GAO Contact and Staff Acknowledgements:
For further information on this testimony, please contact Anu Mittal at
(202) 512-3841 or mittala@gao.gov. Individuals making contributions to
this testimony included Ed Zadjura, Assistant Director.
FOOTNOTES
[1] GAO, Delaware River Deepening Project: Comprehensive Reanalysis
Needed, GAO-02-604 (Washington, D.C.: June 7, 2002); GAO, Oregon Inlet
Jetty Project: Environmental and Economic Concerns Still Need to Be
Resolved, GAO-02-803 (Washington, D.C.: Sept. 30, 2002);, GAO, Corps of
Engineers: Improved Analysis of Costs and Benefits Needed for
Sacramento Flood Protection Project, GAO-04-30 (Washington, D.C.: Oct.
27, 2003); GAO, Corps of Engineers: Effects of Restrictions on Corps'
Hopper Dredges Should Be Comprehensively Analyzed, GAO-03-382
(Washington, D.C.: Mar. 31, 2003); and GAO Army Corps of Engineers:
Improved Planning and Financial Management Should Replace Reliance on
Reprogramming Actions to Manage Funds, GAO-05-946 (Washington, D.C.:
Sept. 16, 2005)
