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some once-promising projects will no longer pass these tests; however, ample regulatory, structural, and nonstructural solutions remain to be pursued.

BUDGET REQUEST

The total amount requested for fiscal year 1975 is $1,620,025,000. This compares with an appropriation last year of slightly over $1.66 billion, a reduction of some $45 million. However, exclusive of funds for flood control and coastal emergencies, for which we recently received a fiscal year 1974 supplemental appropriation, the fiscal year 1975 request represents an increase of about $47 million. As you will recall, our fiscal year 1974 appropriations also have been augmented by the $116 million of fiscal year 1973 programed carryover, including funds for a number of fiscal year 1973 new construction and planning starts. The overall request includes $17.6 million, spread among the various appropriations, for the payment of rent to the General Services Administration, in accordance with the Public Buildings Amendment Act of 1972.

The budget specifically excludes any request for projects requiring further congressional authorization. However, funds are included for a number of projects, which require the enactment of legislation increasing river basin monetary authorization. The conference version of the River Basin Monetary Authorization Act of 1974 is nearing final congressional action and contains the necessary monetary authorization increases.

PRINCIPLES AND STANDARDS

The Water Resources Council's principles and standards became effective on October 25, 1973. The Council and affected Federal agencies are working toward a consistent set of procedures to assist in interpretation and application.

We expect early adoption of a procedure for application of the principles and standards to survey reports. The procedure will require full compliance for surveys now in the review process for which agency action will be completed after December 31, 1974. Surveys expected to clear agency review before the end of 1974, and that had been prepared under Senate Document 97 standards, will have an addendum that supplies abbreviated information reflecting the new standards. The addendum will include an evaluation under the new discount rate, an environmental quality plan, regional development and social well-being displays, and a statement on any need for project reformulation.

The new standards also provide that they will be selectively applied to authorized but unfunded projects. A procedure for consistent interpretation of this provision, and agency guidelines that specify which projects will be covered, are still being formulated. For this reason, project justification information in this year's submission is based on previously approved standards.

INTERAGENCY COORDINATION

Another subject that generated considerable discussion during the 1974 hearings was the corps relationships with other agencies on environmental matters and in areas of interrelated responsibilities. I would like to report that we have made very favorable progress in these areas. Beginning at the deputy administrator level, the Director of Civil Works has held several meetings with representatives of EPA, CEQ, and Interior to work out potential problems and avoid unnecessary delays on projects and studies. In addition to numerous other discussions at the Washington staff level, there have been several joint conferences at field locations. The very nature of our environmental and urban studies programs has required extensive personal contact between corps representatives and the staffs of other agencies. One especially significant example of this coordination is the interagency agreement with EPA, Interior, and Agriculture to carry out plans developed and approved under section 208 of the Federal Water Pollution Control Act Amendments of 1972 for area wide waste treatment management. In addition, we are now working with EPA to assure that grants to be given by EPA for planning under section 208 do not duplicate work funded under our urban study program. Another example of our progress during the past year has been the detailing of two Engineer officers to work with the Environmental Protection Agency. Overall, I consider that our personal contacts with other agencies during the past year have been highly beneficial, and I expect to continue to take advantage of these opportunities.

GENERAL INVESTIGATIONS

The general investigations request totals $59.3 million, a $3.2 million increase over the fiscal year 1974 appropriation. A major segment of this appropriation is the survey program under which we study water resource needs of the Nation and develop recommendations to meet these needs; $33.9 million of the general investigations request is for surveys and is a decrease of $161,000 from the fiscal year 1974 appropriation. However, to obtain maximum results with the funds requested, we are continuing our efforts to fund the most promising studies in a shorter time than in the past by reducing the number of studies in the budget.

URBAN STUDIES

As my predecessor, General Clarke, mentioned last year, we are committed to a program of increased emphasis on urban studies. This program now consists of 28 continuing studies, and 2 of the 3 recommended new starts also are urban studies. The thrust of this program is to consider the entire gamut of water resource problems facing metropolitan areas, including an analysis of the feasibility of alternative approaches to wastewater management. Over $8 million, or nearly 40 percent, of the funds requested for the regular survey program are for urban studies.

In many of the urban studies, the wastewater component is being developed to be compatible with the intent of section 201 of Public Law 92-500, as well as section 208 which I discussed earlier. It is under section 201 that plans for specific wastewater treatment facilities are being formulated by the corps. These 201 plans will permit communities to obtain from EPA funds to design-and later construct-waste treatment facilities.

Last year, Congress added funds to initiate the design of a demonstration wastewater management program for the rehabilitation and environmental repair of Lake Erie. The plan of study is now under preparation and we have included $670,000 in the budget to continue the study effort.

EFFECTS OF PUBLIC LAW 92-500 ON WATER QUALITY STORAGE

The Federal Water Pollution Control Act Amendments of 1972 established the national goal that the discharge of pollutants into navigable waters would be eliminated by 1985. In keeping with this objective, and under authorities provided by that act, the Administrator of the Environmental Protection Agency reevaluates the need for any provisions for storage which may have been made for water quality purposes in any Federal water resources project. On the premise that adequate waste treatment or other methods of controlling waste at its source will be implemented, the Administrator's reevaluation, in most instances, has resulted in a finding that benefits for water quality storage should not be projected beyond 1985. In implementing Public Law 92-500, it has been agreed that EPA determinations regarding water quality control storage in authorized projects will be limited to those projects for which funds to initiate construction had not been appropriated prior to the passage of Public Law 92-500. This position is reinforced by the court decision on the Gathright Lake, Va., project.

Since existing authorities do not permit deletion of storage previously authorized for water quality, the reallocation or deletion of such storage is dependent on congressional action. Delays in preconstruction planning, occasioned by the present need for congressional approval, will be minimized if general discretionary legislation is provided to reallocate storage previously dedicated to water quality purposes. Authority to permit such modifications is included in the proposed Water Resources Development Act of 1974 for those projects where the water quality benefits are less than 25 percent of total project benefits.

INVENTORY OF DAMS

The budget contains funds to complete the inventory of dams. The number of dams to be included in the inventory is now estimated at 67,000, compared with an original estimate of 28,000. In each State, the inventory is being prepared by State employees, or consultants under contract with the corps. The program also includes the preparation of guidelines for the inspection and evaluation of dam safety and a survey of each State and Federal agency's capabilities, practices, and regulations pertaining to the design, construction, operation, and maintenance of dams in order to provide recommendations for a comprehensive na

tional safety program. These recommendations will include the respective responsibilities which should be assumed by Federal and non-Federal interests.

FLOOD PLAIN MANAGEMENT SERVICES

Flood disasters continue to highlight the expanding problem brought about by encroachment in the flood plains. In recent years, widespread and growing concern at all levels of interest has called for changing this trend. Programs of flood plain management highlighting land use regulation-as a key to solving the problem-are now underway in many States and hundreds of communities. We have been providing needed flood plain information and related technical and planning guidance to States and communities through our flood plain management services program. The budget request for this program is $11 millionequal to the maximum expenditure presently authorized by law. The proposed Water Resources Development Act of 1974 would increase this limit to $15 million.

IMPACT OF NEW LEGISLATION

The recently enacted Flood Disaster Protection Act of 1973 (Public Law 93234) will impact directly and indirectly on several Corps of Engineers programs. Section 204 (c) of that act calls on the Secretary of Defense, acting through the Army Corps of Engineers, to help accelerate flood area delineations by giving the highest "practicable priority" in the allocation of manpower to assist the Secretary of Housing and Urban Development, through its Federal Insurance Administration, in carrying out the provisions of the act. In fiscal year 1974, we indicated a willingness to do $6 million worth of reimbursable studies for FIA. We can expect to be called upon for even greater assistance in fiscal year 1975.

To provide this assistance, we will have to reach more deeply into the engineering talents of our District and Division offices and increase, to the maximum extent practical, our use of architect-engineer firms. Our flood plain management services program, which coordinates FIA's reimbursable studies within the corps, will be most directly affected. The increase in the number of communities entering the insurance program will substantially increase the already large volume of requests for technical and planning assistance and guidelines under this program.

CONSTRUCTION, GENERAL

The request for "Construction, general," totals $927.5 million, or about $54 million more than the fiscal year 1974 appropriation.

PRIORITIES

Although there are funding delays on a number of projects included in this request, priority in allocation of funds has been given to those projects which will provide hydroelectric power, urban flood control and municipal and industrial water supply benefits. Commercial navigation projects are continuing to receive a higher priority than small boat harbors. The high priority given to power projects is reflected in our maintaining the best attainable power-on-line dates for projects in the Pacific Northwest that are under construction.

IMPACT OF ENERGY CRISIS ON CONSTRUCTION

At this point, I think it appropriate to say a few words regarding the impact of the energy crisis and other material shortages on our construction program. The construction industry is naturally concerned about fuel allocations but it also is concerned about the supply of construction materials. Many materials, such as cement, reinforcement steel and, of course, most petroleum-derived materials. are in short supply, and material costs are unstable. The result is that some contractors are hesitant to bid on firm price, long-term contracts. Wherever feasible, we are repackaging our work into smaller, separable units which have shorter completion periods. Thus far, on work already underway, we have experienced only minor disruptions due to material shortages. We have worked very closely with the regional Federal Energy offices, and have averted any major disruptions due to fuel shortages.

I want to assure the committee that, although the energy crisis has caused us to reassess priorities and construction practices, we are not lessening our attention to environmental considerations as we design and construct our projects.

NEW STARTS

Seven construction and five planning new starts are included in the "Construction, general," request. The total estimated Federal cost of the construction starts is $229.7 million, and for the five planning starts the cost is $53.5 million. You will recall the decision made about a year ago involving the initiation of new fiscal year 1973 construction and planning starts over a five-quarter period, extending through the fourth quarter of fiscal year 1974. I am pleased to inform you that all of these projects have had this restriction removed. Further, there are no restrictions associated with the continuation of fiscal year 1974 new starts nor with the initiation of those in the 1975 budget request.

PROJECTS IN LITIGATION

There are seven construction projects in litigation for environmental reasons, on which we are enjoined from proceeding with all or part of the work. It appears, however, that the frequency of suits based on NEPA has significantly abated. We have had only one new suit now in 4 months, in contrast with an average of a suit a month previously.

ADVANCE ENGINEERING AND DESIGN

The advance engineering and design request, funded under the "Construction, general," appropriation, is for $18,260,000. In each of the past 2 fiscal years, the corps obligated about $23 million for advance engineering and design. In the current year, we have about $29.4 million available for obligation. The modest request of $18,260,000 anticipates a carryover of about $4 million and, hence, a program in fiscal years 1974 and 1975 of approximately the same dollar magnitude as the past 2 years. The most recently enacted omnibus bill was in December 1970 and, except for those projects costing less than $10 million, which are authorized under section 201 of the 1965 Flood Control Act, the projects included in the advance engineering and design request were authorized in 1970 or earlier. Of the 96 projects budgeted for Advance Engineering and Design, 28 will be completed with funds included in the fiscal year 1975 request.

RECREATION FACILITIES AT COMPLETED PROJECTS

You will recall that, effective July 1, 1973, all new recreation facilities proposed for completed projects were to require 50-50 cost sharing. Although this program is in its early stages, the number of favorable responses received from State and other non-Federal bodies has been extremely gratifying; $20 million of the $25 million in this budget is for new facilities under the cost sharing program. The oher $5 million is for upgrading existing sanitary facilities to be consistent with current Federal and State pollution abatement laws. While the fiscal year 1975 request is double last year's appropriation, I consider this investment essential to keep pace with the visitation we are experiencing at completed projects, and to provide critically needed sanitary facilities.

OPERATION AND MAINTENANCE, GENERAL

The request for "Operation and maintenance, general," is $445 million, compared to $426.6 million appropriated in the current year, including $17.5 million in the Supplemental Appropriation Act for fiscal year 1974. This supplemental provided funds for extraordinary maintenance requirements associated with the Mississippi River Basin flood of 1973. The total increase of $35.9 million over the regular annual appropriation is just about enough to cover price level increases, new requirements for recently completed or nearly completed projects, and the permit program increases associated with recently enacted legislation.

EXPANDED PERMIT ACTIVITIES

At last year's hearings, we stated that an evaluation was underway as to the impact of recently enacted legislation on the corps regulatory permit program. Public Law 92-500, the Federal Water Pollution Control Act Amendments of

1972, requires the Corps of Engineers to review discharge permit applications on the basis of the impact on navigation and anchorages, the latter in coordination with the Coast Guard. In addition, the law requires corps permits for the discharge of dredged or fill material into navigable waters. Public Law 92-532, the Marine Protection, Research and Sanctuaries Act of 1972 (Ocean Dumping Act), extends our jurisdiction to discharge of dredged material in ocean waters. Since enactment of these statutes, and as a result of the greater emphasis being placed on the control of activities in navigable and ocean waters, we have experienced a sharp increase in the number of permit applications reviewed and processed. The budget includes a request for 290 additional spaces to handle the increased activity. I urge the committee to favorably consider this request to permit timely response to applications.

DREDGED MATERIAL STUDY

We are giving high priority to the dredged material study which is providing us more definitive information on the environmental impact of dredging and disposal operations. We fully expect this study to produce substantial savings by developing acceptable and more economical disposal practices.

GENERAL EXPENSES

We are requesting $39.1 million for the General Expenses appropriation. This is an increase of about $3.9 million over the fiscal year 1974 appropriation, including allowances for prior pay raises. The increase includes rental payments to GSA totaling $2.3 million for Division offices and for office space in the Forrestal Building where my staff is housed.

The request also includes $178,000 for 8 months of funding for a total of 10 new positions in Division offices and in my headquarters. These positions include two in my office in Washington to assist in managing our enlarged recreation resource program and to advise the Director of Real Estate on matters pertaining to Public Law 91-646, the Uniform Relocations Assistance and Real Property Acquisitions Act of 1970.

In Division offices, we are requesting eight new positions. Three of these positions are required to support our expanded urban studies program, particularly in the area of developing complex systems of waste treatment. In our Divisions, we have Engineer Inspector Generals paid from both civil works and military funds. A reevaluation of the work they perform indicates that a greater share of their activities are properly chargeable to civil works. Therefore, four of the requested new positions are actually employees whose salaries have been paid from military appropriations in the past. The final new position in a Division office is required to supervise an expanded workload of recreation activities at over 70 public use areas.

FLOOD CONTROL, MISSISSIPPI RIVER AND TRIBUTARIES

The amount requested for Flood Control, Mississippi River and Tributaries, is $130 million, compared with a fiscal year 1974 appropriation of $164.6 million. While this is a substantial reduction from the current year's appropriation, it represents a $20 million increase over last year's budget request.

In 1973, we witnessed the highest river stages on the Mississippi River in many years. Although damages were extensive, Corps flood control projects built with funds provided under this appropriation averted over $14 billion in damages.

The requested funds in the M.R. & T. appropriation will permit us to continue levee construction to the previously approved grades on the main stem levees: continue the channel improvement, including the bank revetment program; and continue the essential work on tributary features, such as the St. Francis, Tensas and Yazoo Basins.

MISSISSIPPI RIVER LEVEE RAISING

Analysis of the 1973 flood revealed that levee grades of over 800 miles of levees are as much as 52 feet too low for the 3.0 million cubic feet per second project design flood. The primary reasons for this are the gradual degradation and lengthening of the Mississippi River since the cut off program in the 1940's. and sedimentation in the Atchafalaya River. This is due to the Mississippi River's dvnamic nature. The channel improvement proiect. including the revetment program, is a continuous effort to overcome this trend by stabilizing the alinement and cross section for both flood control and navigation.

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