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Tuesday, March 24, 1998.











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Opening Remarks of CHAIRMAN MCDADE

    Mr. MCDADE. The committee will come to order. We are very pleased to have the Corps of Engineers with us this afternoon for what will be a very interesting discussion. It always is. This one, however, is a bit special. I want to welcome all of the division officers here. We enjoy having you here.

    And I want to tell you what is going on so you will understand why this is kind of chaotic this morning. We are having a hearing of the full Appropriations Committee across the hall. The issues that are involved are highly significant. For example, the supplemental appropriations bill for the current fiscal year for Bosnia is about $2.6 billion. We are going to act on the supplemental. Obviously, that money has to be appropriated for the men in the field. Is it going to be offset? That is the subject of one argument. Or is it going to be added to the deficit? That is the other side of the issue. And it goes on and on and on. There is also disaster assistance, which you will be called upon to implement.

    So I want to welcome each of you. And, General, since this is a different kind of a hearing, a different afternoon, a different atmosphere around the hall, I am wondering if all of the division officers couldn't stand, identify themselves, except for this fellow back here.

    Mr. BALLARD. You know him, sir.

    Mr. MCDADE. We have known each other for a lot of years. And I was going to suggest that you stand and identify yourselves. We want to welcome you to the Committee. We appreciate all of your hard work.
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    Colonel STROCK. I am Colonel Carl Strock. I command the Pacific Ocean Division.

    Mr. MCDADE. Welcome, Colonel.

    General VAN WINKLE. I am Brigadier General Hans Van Winkle. I command the Great Lakes and Ohio River Division.

    Mr. MCDADE. Welcome, General.

    General GRIFFIN. Brigadier General Robert Griffin, commanding the Northwestern Division.

    Mr. MCDADE. Welcome.

    General SINN. I know you told me not to get up, but I will. I am Jerry Sinn. I command the North Atlantic Division.

    Mr. MCDADE. The general and I go back a long time. It is good to see you here, and you are most welcome.

    General ANDERSON. Sir, Major General Phil Anderson. I command the Mississippi Valley Division at Vicksburg, Mississippi.

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    Mr. MCDADE. Delighted you are here, General.

    General ANDERSON. Thanks.

    General CAPKA. Brigadier General Rick Capka. I am with the South Pacific Division in San Francisco.

    Mr. MCDADE. Welcome, General.

    General VAN ANTWERP. I am Brigadier General Van Antwerp. I command the South Atlantic Division of the Corps.

    Mr. MCDADE. Welcome, General. Glad to have you here.

    Colonel HOLZWARTH. Sir, I am Colonel Don Holzwarth. I command the Southwestern Division in Dallas, Texas.

    Mr. MCDADE. Colonel, you are most welcome. I don't know how a colonel got into that crowd, but we are glad to have you here. We, as all of you know, proceed here in an informal sort of way, so I want to welcome Dr. Zirschky here and General Ballard. We are going to hear from the Assistant Secretary first. You are encouraged, as you know, to put your remarks in the record and to proceed extemporaneously. The Assistant Secretary is recognized.

    Dr. ZIRSCHKY. Yes, sir. I would like to have my statement included in the record.
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    Mr. MCDADE. Without objection.

    [The information follows:]

    "The Official Committee record contains additional material here."

Opening Statement of Dr. Zirschky

    Dr. ZIRSCHKY. Thank you for the opportunity to testify here today. I am proud to be part of the Army Corps of Engineers. We have been the nation's problem solvers since 1775. I think we have a long and proud history of serving this country.

    With me today are the Chief of Engineers, Lieutenant General Joe Ballard; Major General Russ Fuhrman, the Director of Civil Works; and to his left, Fred Caver, our Director of Programs.

    I am going to start by, I guess, giving a few remarks, the bottom line of which is please don't shoot the messenger.

    Mr. MCDADE. Uh-oh. Mike, what do you think that means?

    Mr. PARKER. I don't know.

    Dr. ZIRSCHKY. The General has agreed to notify my next of kin.     Mr. MCDADE. You are most welcome to proceed.
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    Dr. ZIRSCHKY. Throughout my tenure, the Army has tried to work with Congress. We got rid of, for example, the prohibition on district engineers speaking to members of Congress without our permission. We implemented a policy where the Corps of Engineers was going to actually fulfill Congressional adds and we were going to quit fighting about them. If the President signed the bill, that is the law and we are going to execute them. We have also tried to in any restructuring decision, under the restructuring program, make sure members were fully aware of everything that we are doing. We have also put a lot of emphasis on our performance.

    In 1993 a lot of you will probably remember how we were being disparaged because of the '93 Midwest floods. And I think we have come a long way to now where we are getting headlines for saving millions and millions of dollars of damages. In fact, last year we saved about $40 billion in flood damages through our flood protection system. We are still trying to improve our performance. In the last few years we have cut a year off our planning process, still have a way to go.


    Now to get to the budget. I am still breathing, I see. Okay, no one is happy with this budget request, not the Administration, not our customers. I don't know of any member of Congress that is happy with it, nor am I. The Administration wants to work with you. In fact, Director Raines has put an offer in writing over to several senators who wrote to him saying that if you will get a group together, he will come meet and see if we can arrive at a mutually satisfactory future funding level for the Corps.
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    The $784 million we requested for Construction, General is a significant cut and a difficult level to work with, but it is how we are implementing the balanced budget agreement. Let me try and explain how we got to the Construction, General request we made, and that is all pretty much that I am going to focus on, sir. Our other programs, O&M, for example, are generally okay. They might need some more money, but generally we can live within the amounts that we requested for that.

    OMB is trying to stay within the balanced budget agreement. The chart over here to the left, of which there are copies on the dias, show sort of a large gap between how the Administration is implementing the balanced budget agreement, which is the green line, and the current follow-on funding required to keep all the projects we have currently started going at their optimal rate.


    Mr. MCDADE. Dr. Zirschky, it looks like a grand canyon to me.

    Dr. ZIRSCHKY. It is a huge gap, sir, and it——

    Mr. MCDADE. It is impossible, isn't it?

    Dr. ZIRSCHKY. Yes, sir, it is very—I don't have the capability to manage the program in a good fashion with that large a difference.

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    Mr. MCDADE. Not even Moses could handle this one.

    Dr. ZIRSCHKY. Well, Moses probably could. He had some help.

    Mr. MCDADE. I don't think so. He might have some help. Maybe he would get some help down at OMB or wherever this came from.

    Look at that chart now, will you please? Is that a chart prepared by your office, or did OMB do that?

    Dr. ZIRSCHKY. That is an—well, we actually have the Corps do it based on the planning guidance provided by OMB. And it is the chart that was used——

    Mr. MCDADE. So, in the parlance of the day, when you made that chart up, you were following orders?

    Dr. ZIRSCHKY. Yes, sir.

    Mr. MCDADE. Because you recognize, as I do, that the red line represents the need and the bottom line represents—or allegedly represents—the amount of money that is available because of the budget cap. Is that your position?

    Dr. ZIRSCHKY. Yes, sir. And that is a chart that was used in the line item veto statement to talk—to try and begin a dialogue on trying to come to some agreement. There will be many questions, I am assuming, today on why projects didn't get all the money that they need.
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    Mr. MCDADE. Let us just stick on that for a second, because I find that chart very misleading to the Committee and to the general public, because, as you know, that represents a very small total of the domestic discretionary budget of the United States of America. I realize you are the messenger and that you didn't construct this, but OMB is not being accurate or truthful with the Committee or the public when they present that budget. The discretionary budget of the United States is how much? Do you know, Doctor?

    Dr. ZIRSCHKY. No, I don't know, but we are 0.2 percent of it.

    Mr. MCDADE. Well, it is about a third of a trillion seven. This figure over here that indicates there is no room within that is absolutely fallacious, and I am sure you are aware of all the spending initiatives that have come up from the White House as new initiatives that could well be plugged into that line and have the bottom line equal the red line on the top. That is a matter of choice, isn't it?

    Dr. ZIRSCHKY. Yes, I believe the Congress and the Administration have differing priorities on how they would like to allocate the money available under the balanced budget agreement, but the green line is an accurate statement of what we currently have and how we put together this budget.


    Mr. MCDADE. You can't justify sending up to this Committee a budget that can't be executed.
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    Dr. ZIRSCHKY. Well, sir——

    Mr. MCDADE. And OMB can't either. I mean, if you want to stay the messenger and not the advocate, stay the messenger.

    Dr. ZIRSCHKY. Sir, I have to advocate, too. It is—I am here to try and present the President's budget and argue for it. We can execute the program, unfortunately, to bring all the project funding at the red line down to the green line. We didn't give anybody or hardly anybody the amount of money they needed to fully implement their projects this year. So, for example, on——

    Mr. MCDADE. Dr. Zirschky, are you trying to say that there is money in there for all the projects that were begun last year, that the construction budget is——

    Dr. ZIRSCHKY. No, sir.

    Mr. MCDADE—Executable? Are you saying the construction budget can be executed as presented to this Committee?

    Dr. ZIRSCHKY. It can be. There is very little money, follow-on money for '98 new construction projects. Those were not funded by the Administration. For the '97 projects, yes, there is sufficient funds to do some amount of work on every—to my knowledge, every continuing project, but nowhere near the optimal amount we could use. For example, on Houston/Galveston we could have used $64 million. We were able to budget five. We had to——
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    Mr. MCDADE. Now let us look at that number again, because we had a lot of interest on the floor in that figure last year. The budget that would be efficient, spend the taxpayers dollar wisely and have the Corps do what they can do best, i.e. complete the project in a timely way, would require $60 million.

    Dr. ZIRSCHKY. Yes, for that——

    Mr. MCDADE. Is that your testimony, Doctor?

    Dr. ZIRSCHKY. Yes, there is a disclaimer that—let me just submit it for the record, that OMB likes me to put when we talk about project capabilities. I will just submit that for the record, if I could.

    [The information follows:]

    Although project and study capabilities reflect the readiness of the work for accomplishment, they are in competition for available funds and manpower army-wide. In this context, the FY 99 capability amount for XXXX considers the XXXX project by itself without reference to the rest of the program. However, it is emphasized that the total amount proposed for the Army's Civil Works program in the President's budget for FY 99 is the appropriate amount consistent with the Administration's assessment of national priorities for Federal investments and the objective of achieving and maintaining a balanced budget. Therefore, while we could use XXXX on the XXXX project, offsetting reductions would be required in order to maintain our overall budgetary objectives.
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    Individual projects could use more money, but if we gave every project all the money it could possibly use, we frankly would be above our capability to execute the program, because, as you see, it would take $5 billion. And we are not prepared in Fiscal Year '99 to fulfill $5 billion worth of work.


    Mr. MCDADE. My friend, Mr. Messenger, I don't put a bit of credence in what you are telling me. You guys zero funded a host of ongoing projects, didn't you?

    Dr. ZIRSCHKY. Yes.

    Mr. MCDADE. How many ongoing projects did you zero fund?

    Dr. ZIRSCHKY. Almost all of the 1998 construction adds, along with some policy-sensitive projects.

    Mr. MCDADE. Construction what?

    Dr. ZIRSCHKY. All the adds—almost all the adds from the Fiscal Year '98 budget construction——

    Mr. MCDADE. High priority items that were inserted because of Members' requests from around the country?
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    Dr. ZIRSCHKY. I am sorry, sir?

    Mr. MCDADE. You are talking about high priority items that were requested by Members from all around this nation for the benefit of the people of the country? Is that what you mean?

    Dr. ZIRSCHKY. Sir, the Administration decided not to provide follow-on funding for Fiscal Year '98 construction projects.

    Mr. CALLAHAN. Would the Chairman yield?

    Mr. MCDADE. I am delighted to yield to my friend.

Opening Remarks of Mr. Callahan

    Mr. CALLAHAN. Mr. Chairman, you know, this is prevalent in nearly every subcommittee that we serve on and the full Committee on Appropriations. The President has submitted a budget that is a charade. And what you are doing is backing up a charade. Now you know and the President knows that we are not going to be so irresponsible as to not fund the needs of the Corps of Engineers to maintain channels and to continue to fund ongoing projects. You know damn well we are not going to do that. So what you did, you agreed with the President and he concocted all of these new fresh programs that came from out of the blue that sounded good. He is going to save social security and he is going to balance the budget. He knows full well that Congress is not going to be so irresponsible, but you as a soldier are irresponsible in following the lead of your Commander in Chief to say—to sit there and say that the money you have requested is sufficient to perform your job.
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    Dr. ZIRSCHKY. No, I said it was——

    Mr. CALLAHAN. You have submitted the budget.

    Dr. ZIRSCHKY. I have——

    Mr. CALLAHAN. You have requested and you backed the budget up, so you are irresponsible if that is indeed what you are doing.

    Dr. ZIRSCHKY. What I said was we have sufficient funds to keep the projects going, not that we have the sufficient funds to keep them going at their optimal rate. And, sir, if I could continue with the presentation, what I have also said is that OMB does not consider——

    Mr. MCDADE. Just a moment, please.

Opening Remarks of Mr. Parker

    Mr. PARKER. Why should we continue with the presentation? I don't quite understand this. I mean, I am sitting here wasting my time listening to this individual stand up and say we can continue the projects but not at optimal rate. You are taking the American taxpayer and you are stealing from that taxpayer because you are not spending the money in the proper way. I mean, we are dealing with a President who, in his budget brought to the House and the Senate, did not even include any money for Bosnia, even though we are going to have troops in Bosnia. Just for clarification, when the hell did OMB start mandating and deciding what was going to happen in the country contrary to public law that the Congress of the United States makes and you are supposed to follow and you have a responsibility to follow? I am supposed to listen to this trash that you are bringing forth to us, and you are telling me that you have made law but we don't have to follow that? We have got somebody somewhere that has made a decision that we are not going to do this. And you are party to that.
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    Dr. ZIRSCHKY. Sir——

    Mr. PARKER. Try to explain that to me so I can understand it, because I am not the brightest person around.

    Dr. ZIRSCHKY. Well, you are certainly a bright person, sir. I would be delighted to continue the presentation. I have said on the record that $784 million is not a sufficient amount, but that is the number that we have and that is the money that was assigned to our program. But everyone at this table is an Administration official. If I might continue, sir, with the——

    Mr. ROGERS. Would the Chairman yield?

    Mr. MCDADE. The gentleman from Kentucky.

Opening Remarks of Mr. Rogers

    Mr. ROGERS. Let me just follow up on this. This is absolutely a charade. I know your request to OMB was not what you are here with today, is it?

    Dr. ZIRSCHKY. No, sir.

    Mr. ROGERS. The Corps requested of OMB funding far different from what you are presenting here today, correct?
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    Dr. ZIRSCHKY. Yes, sir.

    Mr. ROGERS. Dr. Zirschky is truly a messenger, but he is the only one we can find to lay some gloves on here.

    Dr. ZIRSCHKY. Yes, sir.

    Mr. ROGERS. That is sort of like that general that was seen standing in his command post with his teeth out and a private running out the parking lot with those teeth clamped to his rear end, and the general saying, ''Come back, I am not through with you yet.'' We are not through with you yet.

    This budget by the OMB and the White House is a charade across the board. It is not just the Corps of Engineers, certainly. I know on the subcommittee that I chair we have the SBA, Small Business Administration. They sent a budget up, Mr. Chairman, for the SBA that requested the Congress to double the interest rate charged to disaster victims who had no other recourse to loans, who had been wiped out by flood or fire or tornado or earthquakes in California by the millions—people who could not borrow money anywhere else, by definition making them eligible for a disaster loan. And they were proposing that we double the interest rates on those poor, disaster-stricken people.

    You know what we did in that case? When the Director of SBA appeared before my subcommittee to testify with such a sham budget, I let her make her statement. Then I declared a recess in the hearing and sent her packing. I said we don't even want to hear your testimony or ask you questions until you can present a budget that has reason and logic and truth to it. And we showed her the door.
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    Now there are other shams that I could tell you about. I mean, it is across the board in this OMB. They are absolutely nuts if they think the Congress is going to pass these fees and these tax increases and all of that to fund the programs that they refuse to fund and shift the money somewhere else. And it is true in the case of the Corps of Engineers.

    In my district alone there are eight or ten flood projects that the gentleman has flown with me to look at in past years. One of those projects is costing $180 million to protect people against flooding. It is probably 80, 85 percent or more finished and in your budget request you propose just to stop right there, zero, and waste the 140 or 150 or 160 million dollars you have spent and not spend the extra $10 or $15 million to finish a massive project—not to mention the disaster awaiting the people there if we don't finish the project. It is absolutely, utterly stupid. And I wish you would convey that, Dr. Zirschky, to the folks that told you that you could not present your budget to this Congress.

    In the first place, I find it ridiculous that a legitimate, honorable agency of the U.S. Government is not allowed to come before the Congress to say what they need to carry out the Congress' wishes. How did you come by that? How come OMB has that kind of authoritative power over the Corps of Engineers?

    Dr. ZIRSCHKY. Sir, we are here to make the presentation on the budget, but are allowed to answer any question as members of the United States Army truthfully without fear of recourse. So after we make the presentation, we can answer any question you have.

    Mr. ROGERS. I suggest, Mr. Chairman, that we do the same with the Corps that we did with the SBA: ask them to go back to OMB and present us a budget that is sensible and logical and then we will consider it.
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    Mr. MCDADE. We might do that, but we will chat about it for a second. I want to recognize my friend from Arizona, the distinguished gentleman.

Opening Remarks of Mr. Pastor

    Mr. PASTOR. Thank you, Mr. Chairman. Two doors down we are talking about the President's policy on Bosnia or lack of policy on Bosnia, and we forget that last week this Congress, or at least this House, voted to keep the troops in Bosnia. I guess that, as we deal with these budgets, it is a good time to bash the Administration and its officials. And so I am happy to see Chairman Rogers tell you that you are only the messenger, but we won't kill you, hopefully. We will allow you to go back and take the message.

    Mr. ZIRSCHKY. And then they will kill me.

    Mr. PASTOR. No, I doubt they will. They are honorable men, so I would tell you that I don't think they are going to do that. But it will be interesting after the Easter break, when the majority will bring out their budget, to see where we will be in terms of some of these issues. But I want to thank you for being here, even under these circumstances.

    Mr. Chairman, if I could, could I ask some questions? Do I have some time to ask some questions here on some of the projects?

    Mr. MCDADE. Yes, you do.

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    Mr. PASTOR. Are you going——

    Mr. MCDADE. I was going to go back and permit General Ballard to give his testimony.

    Mr. PASTOR. Okay, I will suspend.

    Mr. MCDADE. May I say to my colleagues that the suggestion by the gentleman from Kentucky is very attractive to us. On the other hand, we know that General Ballard brought in all of his division officers from around the country. They have all got busy work to do, and so I want to hear the general speak to this budget. We want to ask you questions. So, General, you are recognized. Proceed in your own manner.

    General BALLARD. Thank you very much, Mr. Chairman, members of the subcommittee. I—

    Mr. PASTOR. Excuse me, General Ballard.

    General BALLARD. Yes, sir.

    Mr. PASTOR. Could I ask the Chairman a question?

    Mr. MCDADE. Indeed.

    Mr. PASTOR. Will I have time to ask the questions or are we just going to take the testimony and recess?
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    Mr. MCDADE. May I say to my colleague, we intend to hear the testimony and then ask questions.

    Mr. PASTOR. Okay.

    Mr. MCDADE. And try to—if we can between votes over there and testimony here—conclude.

    Mr. PASTOR. Thank you, Mr. Chairman.

    Mr. MCDADE. That is our objective. And we will get back to you shortly.

    Mr. PASTOR. Thank you, General Ballard.

    General BALLARD. Thank you.

    Mr. MCDADE. General, proceed in your own fashion. We are glad to have you here.

Opening Statement of General Ballard

    General BALLARD. Sir, I will do a little bit of paraphrasing, based upon the conversation that just pursued. I have submitted my statement for the record, so I will go ahead and summarize it.
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    Mr. MCDADE. Without objection.

    [The information follows:]

    "The Official Committee record contains additional material here."


    General BALLARD. I would like to summarize quickly on just five topics here, sir. I want to talk a little bit about the division restructuring, something about the headquarters relocation, then come back at my own peril to talk about the Civil Works program budget, say a little bit about the Corps of Engineers financial management system and our Civil Works program execution.


    First I would like to take a moment to review the progress of division restructuring. Beginning in April of 1997, the Corps began to implement the restructuring which reduced the number of division headquarters from 11 to 8. I approved most of the division commander's implementation plan in May of 1997, and since that time the new organization has been up and running. I am convinced that the division restructuring provides a more efficient organizational structure that will result in greater efficiencies in the future. We expect that the staffing level for the eight divisions will be about eight percent less in FY '99 than the division usage in '97 and about 18 percent less by FY '02. I am targeting the Corps Civil Works headquarters activities for achievement of comparable manpower savings.
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    Briefly, some comments about the plans to relocate the Corps headquarters. The Corps proposes to relocate its headquarters in August of 2000 to the underutilized spaces in the headquarters building of the General Accounting Office at 441 G Street Northwest, Washington, D.C. By relocating from the Pulaski Building, we will leave commercially leased space to make more efficient use of government-owned space. The close proximity of the GAO headquarters to the Pulaski Building will minimize the impact of the relocation on the Corps employees. Additionally, our headquarters will not be disrupted by reconfiguration or modernization of space which would be required if we were to remain in the Pulaski Building.


    Turning now to the Civil Works Direct Programs, I know that you have seen and your staff have analyzed the proposed funding level, but let me highlight a few key points. New discretionary funding for FY '99 includes $3.075 million for domestic programs and $140 million for the newly assigned defense program FUSRAP. It is smaller by some $836 million than the total appropriation in FY '98—and I think you are aware of this—largely reflecting a $685 million reduction in the CG program. Seventeen percent of the funding will come from one special and two trust funds that are set up to fund our work and one proposed special fund to be resourced from permit application fees. The proposed funding includes traditional plus the advanced incremental funding. And this approach is in support of the Administration policy to commit up front to funding all federal investment and fixed assets.

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    The overall impact of this budget is consistent with efforts underway to balance the budget, which is important to the nation. It provides funding for Corps traditional missions, including funding for new starts in each year of the five-year program to address some of our more pressing water resource management needs. A special concern of mine, however, is our ability to maintain our existing Civil Works infrastructure. The facilities are getting older and funding is declining. Major General Fuhrman has been focusing on this problem.


    A few words about our new financial management system, CEFMS. As of 30 September '97, we have completed deployment at 44 Corps locations. To date in FY '98 we have completed deployment at our Cold Region Research and Engineering Laboratory, Northwest Division, Alaska District, Transatlantic Engineering Center, Europe and initial deployment at the South Pacific Division. We will complete the process at all locations this month. And in fact, we have done that.

    I am proud to report the success of our first division to have fully operational use of CEFMS for a year. The U.S. Army Audit Agency has advised me that it will be issuing an unqualified audit opinion for the first time for the FY '97 financial statement for our Southwest Division. This will be the first time a major component of the U.S. Army and the Department of Defense have been able to earn an unqualified audit opinion. So we are pleased and flattered that CEFMS is being adapted for widespread use throughout DOD.


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    A quick word on our execution rate. Currently our execution rate against unscheduled expenditures range from 94 to 102 percent, so as you know, these performance measures are critical ones for the Corps. And we will keep working on this area to sustain good performance and improve where necessary.


    So in conclusion, with the recently implemented improvements in our business systems and practices, we have raised the quality and the quantity of our production and in turn the level of customer satisfaction while simultaneously enabling us to participate significantly in efforts to downsize. Our strategic management plan commits us to four more dramatic improvements in performance and customer satisfaction with the goal to revolutionize our effectiveness in problem solving.

    And finally, sir, thanks to the direction set by leaders of this Committee and the trust placed in the Corps, the Civil Works Program does have a strong balance and is highly productive. And I will truly miss the invaluable contributions of our retiring members, you, Mr. Chairman, and Mr. Fazio and Mr. Parker. I look forward to a continuing partnership in this essential program that is so beneficial to our great nation.

    Sir, that concludes my statement. We are prepared to take your questions.


    Mr. MCDADE. General, thank you for your comments. As I look at the budget, your construction account is cut by $690 million, or 47 percent, is that right?
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    General BALLARD. That is correct, sir.

    Mr. MCDADE. Can you tell me when the Construction, general account, which is about $784 million, was last below $800 million? Can you tell me when that was?

    General BALLARD. Yes, sir, I have—we have had some research done on this. I asked the same question about three or four months ago. And it would depend on how you would calculate it. If you go back and look at just pure dollars, current dollars——

    Mr. MCDADE. We want real dollars.

    General BALLARD. Current dollars would be 1970. If you account for inflation, we have never had a budget quite this low.

    Mr. MCDADE. Never had a budget this low?

    General BALLARD. No, sir.

    Mr. MCDADE. Now as I understand it, many projects underway are not funded at all. 46 of 50 high-priority projects which were sent down in law, signed by the President, are now defunded—46 out of the 50 that were sent down. Is that an accurate assessment?

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    General BALLARD. I think that number is correct. I would look for General Fuhrman here, but I think that is accurate.

    Mr. MCDADE. Let me just try to put a little bit of specificity into that. General, how much is in the budget for the St. Paul Harbor Project, which was a project that was underway?

    General BALLARD. To give you the exact number, sir, let me have Mr. Caver look that up.

    Mr. MCDADE. Get ready because I am going to ask you about several. You can tell the general what the answer is, but we want to go pretty quickly if we can. I want to recognize Mr. Pastor.

    Mr. CAVER. The budget is zero.

    General FUHRMAN. The budget is zero, Mr. Chairman.

    Mr. MCDADE. Zero? How much for American River Watershed, California?

    Mr. CAVER. One million.

    General FUHRMAN. One million, Mr. Chairman.

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    Mr. MCDADE. How much is in for the Port of Long Beach?

    General FUHRMAN. Zero, Mr. Chairman.

    Mr. MCDADE. Zero. How about for the Palm Valley Bridge in Florida?

    General FUHRMAN. Zero, Mr. Chairman.

    Mr. MCDADE. Zero. How much for the Wabash River, New Harmony, Indiana?

    General FUHRMAN. Zero, Mr. Chairman.

    Mr. MCDADE. Zero. I am getting a lot of zeroes. We are pitching a shutout here.

    General BALLARD. Yes, sir.

    Mr. MCDADE. I want you to put at this point in the record, General, every project that was underway that is funded at the zero level.

    General BALLARD. Yes, sir, will do.

    [The information follows:]
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    "The Official Committee record contains additional material here."

    Mr. MCDADE. At this time I want to yield to my friend from Arizona, Mr. Pastor, who has a few questions.


    Mr. PASTOR. Well, Mr. Chairman, I hope I have a better batting average than that with some of the projects I am going to ask about. But first of all, before I ask the questions, I want to thank you for being with us and providing the information that will allow us to mark up a bill. So I know there is some dissatisfaction, but this is the budget that is before us and I think we need to work with it the best we can.

    But, Mr. Chairman, let me first recognize the efforts of General Ballard. I have had the opportunity to participate in at least two conferences in which he has tried to extend opportunities to the small business community and to the entrepreneurs who want to participate with the Corps of Engineers, and so I want to let you know that that effort is going on. And I want to congratulate General Ballard for his efforts and wish him the best, and I look forward to working with him on that.

    General BALLARD. Thank you very much, Mr. Pastor.


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    Mr. PASTOR. Most of the questions will deal with projects specific to Arizona, General, so I don't know if you want General Capka to respond. So let us start with this. My first question deals with the Rio Salado feasibility study for environmental restoration. The question is whether it is still on schedule to make authorization under this year's award?

    General BALLARD. Go ahead, please.

    General CAPKA. Yes, sir, it will be. In fact, the feasibility report position, engineer's notice, will be completed by the 10th of April. We expect that the chief's report will be provided to the Administration for forwarding to Congress within about 30 days. And we also expect to initiate the preconstruction engineering and design by May.

    Mr. PASTOR. The second question: What is your FY '99 capacity for furthering the Rio Salado project?

    General CAPKA. Sir, subject to the normal qualifying language that Dr. Zirschky had submitted for the record, the total funds of $2 million could be used in Fiscal Year '99 for additional design for the environmental restoration project. This would advance completion of the PED, the preconstruction engineering design, by about 24 months.


    Mr. PASTOR. General, what is the status of the recreation bridges over the Rillito River, Arizona, project?
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    General CAPKA. Sir, the Los Angeles District recently addressed comments by our headquarters on the limited reevaluation report and is working with the sponsor to negotiate an amendment to the project cooperation agreement. And it is tentatively scheduled for execution in June of this year. And we expect construction to be scheduled for start in September of this year.


    Mr. PASTOR. General, when will you be ready for construction of the Ajo detention basin and Section 1135 environmental restoration project and what is the current cost estimate?

    General CAPKA. Sir, if funding is made available, a construction award could be made during the first quarter of FY '99. The current total cost estimate is about $4.6 million, and would be cost shared on a 75/25 percent basis between the Federal government and local.


    Mr. PASTOR. General, Pima County, Arizona, is very interested in your Challenge 21 initiative. Can the Challenge 21 initiative be included in any part of the Santa Cruz River Basin?

    General CAPKA. Yes, sir. The Challenge 21 is an initiative being recommended by the Administration to Congress to plan and implement projects that restore riverine ecosystems while mitigating flood hazards. Los Angeles District is ready to propose the Santa Cruz River be included in the initiative, provided that there is legislation for Challenge 21 under the Water Resources Development Act, perhaps this year.
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    Mr. PASTOR. In view of the time, this will be my final question, Mr. Chairman, and I will submit the rest for the record. General Capka, if you were not limited by overall Administration budget objectives, how much additional funding could you productively utilize in FY '99 for the Tres Rios feasibility study?

    General CAPKA. Sir, we can use—again, subject to the limitations, we budgeted for $610,000 and can use $700,000 to advance a study completion in approximately three months.

    Mr. PASTOR. Mr. Chairman, I want to recognize the fine work of the Los Angeles District Office. They have been very cooperative, and in Arizona we have had very positive results from that cooperative endeavor. And I also want to thank General Capka for all the leadership he has given. So thank you, Mr. Chairman. I will submit the remaining questions.

    Mr. MCDADE. Without objection. We appreciate the gentleman's input. The gentleman from Kentucky is recognized.


    Mr. ROGERS. Thank you, Mr. Chairman. I am going to ask you specific questions about projects in my district, but I am doing it to make a larger point. You have spent $162 million so far on a flood control project in Harlan, Kentucky, and you are about 85, 90 percent finished. How much is in your budget for next year for Harlan?
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    Dr. ZIRSCHKY. Nothing, sir.

    Mr. ROGERS. Zero.

    Dr. ZIRSCHKY. Zero.

    Mr. ROGERS. Same thing for Middlesboro. We have spent $15 1/2 million out of $26 million. How much is in the budget for Middlesboro?

    Dr. ZIRSCHKY. Zero.

    Mr. ROGERS. Williamsburg, a flood wall. We have spent $19 1/2 million toward its total of $22 million. How much is in the budget for it for next year?

    Dr. ZIRSCHKY. Zero.

    Mr. ROGERS. City of Martin, same thing.

    Dr. ZIRSCHKY. Zero.

    Mr. ROGERS. Martin County, same thing.

    Dr. ZIRSCHKY. Zero.

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    Mr. ROGERS. Pike County?

    Dr. ZIRSCHKY. Zero.

    Mr. ROGERS. And with a good deal of those you have got people sitting in the mud with a wall half finished or a ditch half dug. They are not protected from the flood. We spent hundreds of millions of dollars and yet you propose to just stop them dead in their tracks, right?

    Dr. ZIRSCHKY. Yes.

    Mr. ROGERS. Now what can I tell those people? How can I explain to sensible people back there that their government is doing something like this? Help me out.

    Dr. ZIRSCHKY. Well, sir, at some point if I can return to my opening statement I think I could make it a little clearer, but short of that, there are only a limited amount of funds and the Administration does not view those projects as having a favorable benefit cost ratio and chose not to fund them.

    Mr. ROGERS. Well, the point is that they are 90 percent done. And in spite of what they may think about the original decision to do the projects, they are 90 percent done and the people are sitting in the mud and danger and we will have wasted all of that money. What do you say about that?

    Dr. ZIRSCHKY. Sir, on some of the projects if there is not a favorable benefit cost ratio on the work that remains to be done, then to continue the work OMB would view it as continuing to waste money. Many times we have been successful on cases where there is a positive benefit cost ratio to completing the last bit of work to get them to successfully fund it. And we could look to see if any of those are in that category. That is the only time we have been successful with OMB.
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    Mr. ROGERS. Now I am assuming that the list that I gave you is typical of the rest of the country. Is that right? There are ongoing projects which have been just stopped dead cold, correct?

    Dr. ZIRSCHKY. I would say that those projects are—they are more concentrated, sir, in your region of the country than——

    Mr. ROGERS. Because they are section 202 projects?

    Dr. ZIRSCHKY. Yes, sir.

    Mr. ROGERS. When the Congress passed that law, by definition the 202 projects were designated to occur regardless of the cost benefit ratio, correct?

    Dr. ZIRSCHKY. Yes, sir.

    Mr. ROGERS. So they don't stand on the same footing as other types of projects, but is it not true that projects around the country—although maybe not to this degree—have been zeroed out?

    Dr. ZIRSCHKY. Yes, sir, most of the 1998 new starts have been zeroed out for reasons——

    Mr. ROGERS. Now I am not talking new starts. I am talking ongoing projects now, not new starts.
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    Dr. ZIRSCHKY. No, sir, most projects were not zeroed out. Almost none of them got the amount of money that they needed.


    Mr. ROGERS. All right, now let us talk about new starts. How much did OMB send up here for new starts, brand new starts? How much money?

    Dr. ZIRSCHKY. It wasn't very much. I don't know the exact——

    General BALLARD. I think, Fred, do you have that number?

    Mr. CAVER. No, I don't.

    Mr. ROGERS. I have got it for you. It is $410 million. Anybody dispute that?

    Dr. ZIRSCHKY. That is the total once they are all built.

    General FUHRMAN. It is total once they are all built.

    Dr. ZIRSCHKY. It is 16,100,000, roughly, for this year.

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    Mr. ROGERS. But you are committing yourselves with these new starts this year to a total construction cost of $410 million?

    Dr. ZIRSCHKY. Yes, sir.

    Mr. ROGERS. These are new projects, right?

    General BALLARD. That is correct, sir.

    Mr. ROGERS. They are not in the middle of construction or anything. They are brand new starts.

    Dr. ZIRSCHKY. Yes, sir.

    Mr. ROGERS. And so you are proposing to stop construction or underfund existing projects around the country in order to start new starts that OMB says should be started, correct?

    Dr. ZIRSCHKY. No, sir. What I was trying to get to with my presentation is to explain why this budget request was so low and to make an offer that Frank Raines has put in writing to meet with the committees personally and try and come up with a new number that addresses those concerns.

    Mr. ROGERS. We don't meet with them. We will do our budget, and if he likes it, fine. If he doesn't, who cares?
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    Dr. ZIRSCHKY. Well, sir, the——

    Mr. ROGERS. He does not write this Committee's spending priorities. He does not spend the taxpayers' monies. By the Constitution and the law, we spend those dollars, and by God, we will. Tell him that.

    Dr. ZIRSCHKY. Yes, sir. I don't actually get to talk to him very much. He is higher up the food chain than I am. But yes, sir, we did request some new starts. The message we are trying to send is that the Administration does want new starts. What they would like to get an agreement on is what level of a construction budget in the future.

    And it does matter, because if we can't come to some agreement, our lives become increasingly unmanageable, because every year we put together the budget—I had two choices this year with the amount of money that I had. I could have chosen to fund only a few of the projects at their optimal rate and left a lot of other projects zeroed out. But instead, to do the best I could to work with the Committee, I told the Corps to at least try and give every project that OMB would let us some amount of money to keep it going so that at least you wouldn't have to get it added back to the budget. It would become an issue of agreeing on how much extra money to put in that program. That has us in a very difficult situation, because if we can't get some agreement next year we are going to be up here with probably a bigger problem.


    Mr. MCDADE. Let me interrupt for just half a second, only because my colleague has asked a good question and you are trying to give a good answer. You are basing your answer on the amount of money that OMB apportioned to you for that portion of the budget?
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    Dr. ZIRSCHKY. Yes, that is what we are required to do.

    Mr. MCDADE. What did you request?

    Dr. ZIRSCHKY. $1.8 billion for Construction, General.

    Mr. MCDADE. I yield to the gentleman from Kentucky.

    Mr. ROGERS. You requested $1.8 billion?

    Dr. ZIRSCHKY. Yes, sir.

    Mr. ROGERS. And how much did you get?

    Dr. ZIRSCHKY. I successfully argued for $784 million.

    Mr. ROGERS. And you didn't even get to talk to Raines?

    Dr. ZIRSCHKY. Yes, sir, I did talk to Raines at several points during the line item veto discussions to urge a moderation of line item vetoes and to urge a negotiation with the Congress to try and get some agreement, because the situation is getting more and more unmanageable.

    Mr. ROGERS. Well, surely he will understand one of these days that it is better for him to send up a credible budget request here on your behalf and other agencies' behalfs and have us discuss it sensibly because he sent up a rational budget spending plan. Surely he understands that that is much preferable to sending up a nonsensical budget plan that we throw in the waste basket. He loses all input into our deliberations at that point, because it is a nonsensical budget. Does he understand that? Well, you don't know.
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    Dr. ZIRSCHKY. Well, I would hope that he would. There is some disagreement, frankly, about the levels of our funding. And I believe Director Raines understands the issues now. And I would hope that we could sort of all take the moral high ground, and even if this budget is unacceptable still get together and try and work out a new one.

    Mr. ROGERS. No, I mean, once you send up your budget and it is nonsensical enough not to be considered, you lose all input. I mean, we will take it and do it over. We have to. And you lose all credibility. You lose all input. And that is unfortunate, because you are the experts. You are the people that are doing the work and are charged to do the work and should be doing the work. But when you give us something that is incredible, we throw it in the waste basket and we write it ourselves and OMB loses all input into the process. Is that what they want?

    Dr. ZIRSCHKY. I would hope not, sir. The problem for us is we have got to figure out what to do the rest of this fiscal year, and we don't know what we are going to have for '99. And we are going to be faced with the potential for work stoppages or not keeping projects going. I think we can handle all of them right now, but I would like to get some guidance before I leave from this Committee on reprogramming to at least keep your work going. I would be happy to discuss that at your convenience, Mr. Chairman.


    Mr. MCDADE. Do you mean reprogramming from within the construction account?
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    Dr. ZIRSCHKY. Yes, sir.

    Mr. MCDADE. You are going to rob Peter and pay Paul. Is that what you are saying?

    Dr. ZIRSCHKY. I am going to rob Peter.

    Mr. MCDADE. Yes. We don't like robbing up here.

    Mr. VISCLOSKY. Mr. Chairman, I would object to that last remark.

    Mr. MCDADE. You know, as we sit in this committee room, we tend to forget what the impacts are. The gentleman from Kentucky was referring to citizens in his state with uncompleted projects and the consequences. Are you familiar with the Los Angeles County Drainage Area Project?

    Dr. ZIRSCHKY. Yes, sir.

    Mr. MCDADE. Do you know what the impacts are if this budget remains the same on that project?

    DMr. ZIRSCHKY. Yes, sir. And if the future allocations or assignments don't change, it will probably delay the project roughly 10 years.
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    Mr. MCDADE. And what does it do to the local citizenry?

    Dr. ZIRSCHKY. The people who will not be removed from the 100 year flood plain, are lower income people, and will have to spend a considerable amount of money, at least for them, on their flood insurance. I have written to Director Witt to ask him that if we cannot find more money within our program to keep LACDA going, would he consider trying to work something out where the flood insurance premiums would go directly to the project rather than to some insurance pool so we can get the job done.

    Mr. MCDADE. The information that has come to the Committee from the citizens of that area and the local sponsor is that their flood insurance of the, as you said, mostly lower income people will be 10 times greater if this budget stays in effect. Do you agree with that?

    Dr. ZIRSCHKY. I don't know about exactly 10 times, but their costs will be much more significant, and the chances of having a flood——

    Mr. MCDADE. You don't know that it is 10 times, do you?

    Dr. ZIRSCHKY. No, sir.

    Mr. MCDADE. Okay. The gentleman from Michigan is recognized.

Opening Remarks of Mr. Knollenberg
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    Mr. KNOLLENBERG. Thank you, Mr. Chairman. Welcome, I think. Well, I don't believe we have any——

    Mr. MCDADE. Forgive me for interrupting. I don't want your questioning to be interrupted, and I am advised a vote is going to occur across the hall in just a few minutes. So we have to go, gentlemen, and be a party to the vote. The committee will recess for 15 minutes.



    Mr. MCDADE. The Committee will come to order. The Chair recognizes the gentleman from Michigan.

    Mr. KNOLLENBERG. Thank you, Mr. Chairman. Let me start with a couple of questions about a local situation in the State of Michigan. The first question concerns the Soo Locks. It is a replacement lock. Can you give me an update on the status of the Soo? How much have we spent, and how much will the total project cost?

    Dr. ZIRSCHKY. I can give you an update on the current status and would ask the General to provide the financial figures. We are in the process of trying to finalize a draft reevaluation report.

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    Mr. KNOLLENBERG. If you can, please be very brief in this analysis.

    Dr. ZIRSCHKY. Okay. All right. Right now we are looking for a state or states to be a cost-sharing partner for those locks and have not yet identified such a partner. And, General, if you want to go over the economics?

    General FUHRMAN. We are continuing to use the FY '98 money to do that. There is no money requested in FY '99 for that project.

    Mr. KNOLLENBERG. So then how much will the total project estimate be? How far are we from paydirt—from closure?

    General FUHRMAN. Well, the entire project would be in the neighborhood of $300 million if we go to construction.

    Mr. KNOLLENBERG. $300 million?

    General FUHRMAN. Ultimately go to construction.

    Mr. KNOLLENBERG. All right. But the whole thing is kind of on hold then. What you are saying is that there is no money in the budget to continue that?

    General FUHRMAN. Yes, and the key piece, Congressman, is a cost-sharing partner sponsor for that project.
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    Mr. KNOLLENBERG. What are the risks if we don't proceed with this replacement lock?

    General FUHRMAN. At this point in time, the locks that are there—the major lock that is there is adequate to handle the traffic. The issue is what sort of risk does one want to take in the future.

    Mr. KNOLLENBERG. And by the future you mean, General, when?

    General FUHRMAN. In the next—I guess it would be in the next 10 to 15 years depending on an analysis of what the traffic patterns and commerce associated with that lock are and the Great Lakes are.


    Mr. KNOLLENBERG. Let me go to a question about Lake St. Clair, which is also a Michigan lake. There is a program called the Aquatic Plant Control Program in Lake St. Clair. I don't know who would have the specifics on that. But I want to know just what progress the Corps is making in fighting the invasive plant species. We have a real problem in Lake St. Clair, as you well know.

    And I know in 1998 Congress appropriated $5 million for that program, which was a $3 million increase over '97, and I see this year the President's '99 request is $2.6 million. What level of funding is necessary to maintain control of Lake St. Clair? Is it adequate at the present? Is that reduction proper?
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    General FUHRMAN. That money is only for R & D. It is not for any actual removal of materials.

    Mr. KNOLLENBERG. Would that reduction in the budget, though, impair or negate what it is you are trying to do there?

    General FUHRMAN. It would slow down the speed of the research and from that perspective would delay any solutions for implementation.

    Mr. KNOLLENBERG. As you know, the zebra mussels and the sea lamprey are the problem there, and it has been a real problem. Sometimes it is up, sometimes it is down, but it is never gone entirely. So you are saying there would probably be a negligible effect upon that situation if the funding were not maintained?

    General FUHRMAN. Clearly, it would affect the rate at which we can conduct the research to find a plausible solution.


    Mr. KNOLLENBERG. Let me go to a question on FUSRAP. And, by the way, I applaud what is being done in that regard. I think, General Ballard, you might be the one to speak to this. But I am interested in learning how the transition of the FUSRAP program to the Corps of Engineers is going, and I was encouraged when we moved that program from the DOE to the Corps of Engineers. I had some optimism about the fact that this will help clean up those sites that much faster.
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    Specifically, in the report language in the conference report for the Energy and Water Appropriations Act for '98, it provided the following: the Corps should determine if it is possible and/or reasonable to meet the proposed 2002 completion date and report to the Committee on Appropriations within 90 days on what steps must be taken to meet this date. Number 1, has the Corps met that 90-day deadline?

    Dr. ZIRSCHKY. No, sir, we did not. We got the report cleared late last week, and I believe it was submitted this morning.

    Mr. KNOLLENBERG. So it will be another——

    Dr. ZIRSCHKY. No. I mean, it was submitted to Congress I believe this morning.

    Mr. KNOLLENBERG. All right. So it is——

    Dr. ZIRSCHKY. It is late.

    Mr. KNOLLENBERG. It is late. Okay. I am not trying to come down on the Corps on this thing—not necessarily. In fact, I am trying to encourage you to prove your worth in that regard if you are capable of cleaning up and closing out the FUSRAP sites. That is really the area that I want to investigate with you. The DOE failed in getting this program closed out. If the Corps proves effective with FUSRAP, could they become a player in other defense cleanup sites?
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    General BALLARD. Let me take that, sir. It is not if. We will execute the FUSRAP program when the——

    Mr. KNOLLENBERG. I am not advocating that you take on everything that is out there because you have got——

    General BALLARD. No, sir. I fully understand.

    Mr. KNOLLENBERG [continuing]. Some limitations too, of course.

    General BALLARD. We do have some limitations. When the program was transitioned to us, we established four key priorities: Number 1, that we would transition a program without slippage from the DOD original time line. We have done that. The second one was to do a complete assessment of the 22 sites——

    Mr. KNOLLENBERG. It is 22 sites?

    General BALLARD. It is 22 that were transitioned to us, sir. And then to prepare that report, and, as you requested, we did that within the time that was given to us. The third priority was to then transfer that program from the DOE contractors and get it down to the districts and the divisions who were actually executing that work, and we have done that. The other priority that I laid on on my commanders was to leverage the dollars that were given to us without any growth in FTE so we have done that. This program I feel is on a sound footing, and we are beginning to move out on it.
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    Mr. MCDADE. Will the gentleman from Michigan yield?

    Mr. KNOLLENBERG. I would be glad to, Mr. Chairman.

    Mr. MCDADE. General, not only are you and your officers to be commended for not increasing employment, but in terms of administrative costs, the Corps beat the old system. I believe that we are saving about 30 percent in the administration of these contracts in the way you are executing them.

    General BALLARD. I think in the rough order of magnitude, that is about correct, sir.

    Mr. MCDADE. And we have a roll call vote across the hall. We will recess for 10 minutes this time and will see you at 3:15, we hope.

    General BALLARD. Yes, sir.



    Mr. MCDADE. The Committee will come to order, and the Chair recognizes the gentleman from Indiana.

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    Mr. VISCLOSKY. All right. Thank you very much, Mr. Chairman. Now, Mr. Secretary, you have a chart up here on fund expenditures in recent years with two bar graphs; the red indicating how much money was available to spend, a green bar indicating how much money we were able to spend. Is the green bar your capability, or is it simply what you spent?

    Dr. ZIRSCHKY. Well, sir, for the past years '94, '95, '96, that was our capability. That is what we were able to actually put out the door. We are proposing a half a billion dollar increase in our capability in '98, that we will be able to put out a half a billion dollars more work. That is a pretty significant growth in performance.

    Part of the difficulty, and I have skipped a number of charts in my presentation that we are looking at, is we will have a billion dollars in carryover at the end of fiscal year 1998. And what I hope I can get from the Committee—not all that billion dollars we can use. I don't want to give that impression. I would be delighted to explain what that money is. I need some guidance from the Committee on how I might use some of that money to reduce the amount of carryover.

    That is why OMB reduced our Construction, General request is that we got so much money in fiscal year '98, they wanted to keep our outlays at roughly a billion dollar range so they subtracted the money we were going to carry over in construction from what they hoped we would spend in construction to come up with the $784 million. That is not the number they wanted either, but we got money faster than we could use it on many projects in fiscal year '98.

    And OMB and CBO agree that roughly on new construction money, we spend about 60 percent of that in the year we get it, and 40 percent of it carries over. And our growth in funding was so great that we will probably carry even some more of that over. Before I leave, Mr. Chairman, I would like to discuss with you how I might reprogram more money to reduce that carryover and get some projects back on schedule.
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    Mr. MCDADE. Go ahead. We would like to hear from you. You might as well do it now. Mr. Visclosky?

    Mr. VISCLOSKY. If you want to do it right now, that is fine with me.


    Dr. ZIRSCHKY. Okay. The next chart—it sounds like, you know, a billion dollars is a huge amount of money, and that is, frankly, how we got into this situation of not having a very big budget request that is in '94 and '95. In '94 we had $1.4 billion left over, and to get our carryover down, we got our budget authority cut, and we have never been able to get that budget authority back.

    Of that $1 billion, about $145 million of it is easily reprogrammable. We have follow-on funding for those projects. It is budgeted in '99. Of that $145 million, about $112 million of that is construction money, and we have identified that we need $80 to $90 million of that and will be submitting a reprogramming request very soon to make——

    Mr. MCDADE. Let me ask you a question. Do you have to submit a request for reprogramming to the OMB?

    Dr. ZIRSCHKY. For certain amounts, yes, we do.

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    Mr. MCDADE. What is the threshold?

    Dr. ZIRSCHKY. It depends on the kind of project. Fred, could you give a good rundown on the rules?

    Mr. CAVER. Yes. In the construction account, which is mostly what we are talking about here, first we can restore any amounts that were reprogrammed away from those projects in the past up to the full amount of what was taken away. We can also restore savings and slippages that have been taken out of the projects. And then beyond that, we have——

    Mr. MCDADE. Is there a ballpark figure in there that you can put in for me? Is there a way you can articulate what the monetary equivalent might be?

    Mr. CAVER. Well, it depends——

    Mr. MCDADE. I know it depends on the project.

    Mr. CAVER [continuing]. On the project.

    Mr. MCDADE. But historic record.

    Mr. CAVER. Historic record, I would say that we would be able to restore in most projects most of what we would need to continue them.

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    Mr. MCDADE. But is there a dollar value that we have to clear?

    Mr. CAVER. No.

    Mr. MCDADE. That is what I am trying to get from you.

    Mr. CAVER. I am sorry.

    Mr. MCDADE. If you can amplify it for the record. Excuse me. Go ahead, Dr. Zirschky.

    [The information follows:]


    Generally, reprogrammings to Construction, General (CG), projects in any fiscal year are limited to 15 percent of the sum of the conference amount plus the unobligated carryover from the prior fiscal year, except as noted below.

    Up to $300,000 may be reprogrammed to a project without regard to the percent limit for projects on which the amount available for the fiscal year is $2,000,000 or less.

    Up to $5,000,000 may be reprogrammed to a project without regard to the percent limit when the increased requirement results from a settled contractor claim, increased contractor earnings due to accelerated rate of operations, or a real estate deficiency judgement.
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    Funds reprogrammed away from projects experiencing non-funding delays in prior years or the current year may be restored if needed. Similarly, savings and slippage amounts assigned in prior years or the current year may also be restored if needed.

    The Assistant Secretary of the Army (Civil Works) (ASA(CW)) reports quarterly to Congress on cumulative CG reprogrammings of $500,000 or more to specific projects.

    For reprogramming actions that exceed the Corps limits, the ASA(CW) confers with the Office of Management and Budget and then sends letters to the Subcommittees on Energy and Water Development of the House and Senate Appropriations Committees to coordinate such actions.

    Dr. ZIRSCHKY. I am sorry. The problem is that we have this carryover. A lot of it we can't use, but it counts against us in putting the budget process together. They kind of, I don't know—pink, orange, whatever color that is—there is about $681 million that is currently unavailable for reprogramming, partly by policy. The Flood Control and Coastal Emergencies Account, we have got about $300 and some million in there; $165 million of it is unidentified for needs so that is a surplus.

    Mr. MCDADE. Million or billion?

    Dr. ZIRSCHKY. Million, I am sorry—$165 million currently uncommitted. That cannot be reprogrammed to construction because it is a different account. The coastal wetlands account, that is money in a trust fund that we are holding for other agencies, and it can't be used for construction.
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    But here is my problem. I have about 25 percent of that amount of money is in the construction budget. Past Administrations would have tried to reprogram that money. This Administration has tried to work by the Committee by not reprogramming it because it is kind of a double-edged sword. We didn't budget for it in '99. So if I take the money for those projects, I have no way to pay it back.

    Mr. MCDADE. On his watch, we are back to robbing Peter again?

    Dr. ZIRSCHKY. Right. Past Administrations didn't care. They did that. I don't want to do that at least without talking to you.

    Mr. MCDADE. What are you suggesting to Mr. Visclosky and the Committee?

    Dr. ZIRSCHKY. I am suggesting, sir, that if we can try and get some better understanding with OMB. I would like to take some of that money, even though I can't promise to pay it back, and get some projects done that are being starved for money and get that carryover down because a billion looks bad.

    Mr. MCDADE. There are an awful lot of them, and every day that we don't proceed in an orderly way, it is costing everybody a lot more money and inflicting the kind of pain on people that we were discussing a bit ago.

    Dr. ZIRSCHKY. But my problem is I can't promise to pay it back.
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    Mr. MCDADE. Excuse me. I am taking——


    Mr. VISCLOSKY. No, not at all, Mr. Chairman, not at all—which leads me to my original question. On the red and green bar graphs, from what you are telling me in your discussion with the Chairman about reprogramming, there would be no point in reprogramming if you didn't have greater capability?

    Dr. ZIRSCHKY. Correct.

    Mr. VISCLOSKY. So the shortfall here isn't because of a lack of capability, it is a lack of money that you can apply to certain projects, whether it is because of a legal impediment, or a lack of reprogramming; it is not lack of capability?

    Dr. ZIRSCHKY. Well, it is not entirely correct. There are projects——

    Mr. VISCLOSKY. Well, if I followed your conversation with the Chairman and your conversation about requesting reprogramming, is there any point in the Committee reprogramming a penny for you if you can't use it?

    Dr. ZIRSCHKY. We would put it on projects that we could use, but the problem is——
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    Mr. VISCLOSKY. Well, that is capacity. That is capability. Right?

    Dr. ZIRSCHKY. But the problem is if we had full follow-on funding for all the projects that were started in 1998, we would exceed our capability to spend the money in the out years and starting in 2000.

    Mr. VISCLOSKY. The out years?

    Dr. ZIRSCHKY. Yes.

    Mr. VISCLOSKY. In the out years, not this year?

    Dr. ZIRSCHKY. Not this year.

    Mr. VISCLOSKY. Not this year. All right.

    Dr. ZIRSCHKY. I hope not.

    Mr. VISCLOSKY. And what you are simply suggesting is in the out years based on—and I don't say it in a derogatory fashion—arbitrary decisions that were made last year, you lacked the capability because you lack money?

    Dr. ZIRSCHKY. This year. In the out years, we will lack capability because we don't have the ability to get the work done. We are currently projecting growth of $5 billion. That chart you are looking at shows full follow-on funding of about $5 billion.
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    Mr. VISCLOSKY. Because of your assumption you won't have the money?

    Dr. ZIRSCHKY. No, because we have not executed $5 billion in 20 years. General Ballard is working very hard to get our efficiencies up to get the work out the door. But we had over $5 billion we could have spent in fiscal year '94, and we didn't do it. We got $3.3 billion worth of work out the door. Right now today if you gave us $5 billion, we couldn't effectively spend it in this year. Now, we could build to it. We could grow back up to what we used to have, but it has been a long time. And I don't think we can grow fast enough to get that done, and that is part of the problem.


    Mr. VISCLOSKY. Let me get back to your bar chart. Do you have a bar chart for simply your construction budget?

    Dr. ZIRSCHKY. No, sir. And that is a program that we can oftentimes spend great deals of money if we get some big projects going, but I don't have a separate bar chart for execution of our construction budget with me. I can get that for you.

    Mr. VISCLOSKY. Could you, for the record, for the years covered by this bar chart give us the figures, and I don't need a——

    Dr. ZIRSCHKY. Yes, sir.
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    Mr. VISCLOSKY. The committee doesn't need a chart—just figures as far as what that would look like for construction?

    [The information follows:]

    "The Official Committee record contains additional material here."


    Dr. ZIRSCHKY. Yes, sir. In fact, in that package for our total budget is a chart prepared by the Corps. It has a blue line and a red line and kind of a big multicolored hump. The red line is our current capability to do work. This was prepared by the Corps—that chart—and I think we could put it up over there.

    Everything above that red line exceeds our ability to get the work done at our current levels of efficiency, and we can work hard to do better. But that is a snapshot. If we don't get any better than we are right now, that is what we can do. And, trust me, this is not a story people want me going around telling the world.

    Mr. VISCLOSKY. So that I understand your answer, in the short term, the shortfall is money?

    Dr. ZIRSCHKY. Yes.

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    Mr. VISCLOSKY. In the long term, it is money and capabilities, because given your current staffing and your current expectations and plans, you literally lack the personnel?

    Dr. ZIRSCHKY. No. We have plenty of people. We have a smaller budget than we had 30 years ago and the same number of people roughly. What we have done and part of it is in years we have made ourselves inefficient; not that the people aren't great, but we have rules and procedures that make things take time. They are not efficient. We are trying to fix those. But we put out less workload per person today than we did 10 years ago.

    Mr. VISCLOSKY. And that is why you would lack capability in the out years?

    Dr. ZIRSCHKY. Yes.

    Mr. VISCLOSKY. Even if we gave you more money?

    Dr. ZIRSCHKY. Yes. We don't need more people. I have probably 500 more FTE's in our Support for Others Program than I have clients to do the work.

    Mr. VISCLOSKY. So what do we have to change so that we can give you more money and increase your capability if the Committee would be so inclined?

    Dr. ZIRSCHKY. On behalf of the Administration, we don't want more money until we get an agreement because of these issues, but I think General Ballard——
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    Mr. VISCLOSKY. Let us forget about more money. Let us talk about efficiencies for the personnel you have today.


    Dr. ZIRSCHKY. Okay. All right. We have a strategic plan as required under the Government Performance Results Act, and some goals were set that General Ballard has included in his strategic plan.

    Mr. VISCLOSKY. And I don't mean to interrupt, but is that the one that you scored 11 out of 105 on last year?

    Dr. ZIRSCHKY. I hope—no, sir. This is a much different plan. We didn't do very well on that plan, and one of the first things I did was to restart that process. I hope you will like our new plan better. And General Ballard has a strategic vision and a plan to implement the Administration's goals that I believe he can get our efficiencies up. He has a tough job ahead of him.

    Right now today, I mean, you can ask him, I don't think we could do $5 billion worth of work. But I think given his vision, some chances to push it, to do better, to focus on how we can do a better job and start saying what is it we can do instead of it is somebody else's fault, we will get there. And I think he can get us there. But right now we are not there.

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    Mr. VISCLOSKY. What do we have to do?

    Dr. ZIRSCHKY. It is not what you have to do, it is what we have to do and all the commanders sitting here have to do. We have to get more, find new ways of doing business, be more efficient, work together more as a team. I mean, frankly——

    Mr. MCDADE. If I may interrupt you, we have another recorded vote in the Committee across the hall. We will recess for 10 minutes and will be back. The Committee stands in recess.



    Mr. MCDADE. The Committee will come to order. At this juncture, let me ask you a question, doctor. That number you are mentioning, $5 billion, represents what? The total account of the Corps? What does it represent?

    Dr. ZIRSCHKY. That was if we fully funded everything at its optimal schedule that we currently have ongoing, it would require about $5 billion in future funding at future budget requests.

    Mr. MCDADE. Well, the construction budget that is under discussion is about $1.8 billion, isn't it?

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    Dr. ZIRSCHKY. That was our request to OMB.

    Mr. MCDADE. Is it yes or no? That is the amount, isn't it?

    Dr. ZIRSCHKY. Yes.

    Mr. MCDADE. Are you saying that couldn't be executed by the Corps?

    Dr. ZIRSCHKY. Sir, I would be very doubtful that if you gave us $1.8 billion in fiscal year '99 that we would spend over 80 percent of it.

    Mr. MCDADE. You doubt it. General, let me get your personal opinion. Do you believe that the Corps could execute efficiently a $1.8 billion construction budget?

    General BALLARD. Yes, I do, sir, and that was the budget we submitted.

    Mr. MCDADE. And I would assume that having submitted the budget you believe you could execute it?

    General BALLARD. I think that is correct, sir.

    Mr. MCDADE. Let me ask you a question. And this isn't going to happen, this is hypothetical. But if we were to move that line up—and as I say to you I don't see that happening; we are trying to get back to ground zero is what it amounts to—would you have capacity beyond that?
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    General BALLARD. Yes, sir.

    Mr. MCDADE. Is it not a fact that all of the slowdowns that were referred to and decreased productivity are a result of regulation and not the Corps' capacity to let contracts and build?

    General BALLARD. Well, that is part of the problem. Let us if I might——

    Mr. MCDADE. Please, General.

    General BALLARD [continuing]. Just talk about the execution of the program. To go back to what Congressman Visclosky said, capacity is driven by dollars because if I had the dollars, then I could increase the capacity, either by growing the number of contractors or partners or building the workforce in-house if necessary. The uncertainty of not having the dollars preclude such things as making reasonable agreements with our cost-sharing partners because of the uncertainty of the dollars being there.

    In many cases, and I think you know of projects where if we were certain that the Federal share would be there, then our partners would move more aggressively towards coming up with their share of the money. Then you run into problems with real estate. You run into problems of environmental restrictions that hold down the ability to execute the project.

    Mr. MCDADE. A lot tougher today to do it, isn't it?
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    General BALLARD. Very tough, very tough. But in terms of building efficiency, yes, we are aggressively addressing efficiency and trying to raise that to become much more productive and customer focused. But I could execute it, the $1.8 billion.

    Mr. MCDADE. I thank you for your opinion, General, and I yield to the gentleman from Mississippi, Mr. Parker.


    Mr. PARKER. Thank you, Mr. Chairman. General, how long have you been with the Corps?

    General BALLARD. I have been in USACE, sir, 18 months—this Corps right here, but I have been an engineer officer for 32 years.

    Mr. PARKER. I am very much concerned, of course, about the direction that the Corps is going. I get a little perturbed sometimes. I keep getting people playing these little political games and that bothers me. It appears to me that sometimes decisions are made somewhere that certain water projects should not be done regardless of what Congress says or any legal directive that is there. And on the other hand, it seems okay if you are asked to spend enormous sums of money on projects that I never even thought were in the scope of the Corps' primary mission, and I will get to that in just a second.

    Now, I know politics involve just about everything. My daddy was a country preacher, and I watched politics up close early on in my life. And it just seems to me that the current Administration thinks it is okay to play politics with any congressional adds that we have. They want to refer to them as pork, and they think that they can shut off anything with a very simple bureaucratic directive. Now that bothers me.
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    Now, you have already come before this Committee and said that the request that you have brought doesn't represent a true accounting of the Army Corps' funding priorities. What you have said is, ''I am going to defend this budget by the President.'' Now, that is disingenuous. I don't think that it smacks of a great deal of honesty from my viewpoint, but you have come to us with that.

    Now, I have got a couple of questions. Can you explain to me the validity of requesting $117 million for fish mitigation on the Columbia River in Washington state and nearly $100 million on Everglades restoration and not requesting funds to continue ongoing construction projects around this country? Now, that is just a basic, simple question.

    Before you say anything, let me just add one thing here. Now, I know that our Vice President, the Honorable Al Gore, has said that what he wants is a third of the Corps' projects to be environmental in nature. And if I am wrong about that, I would like to be corrected. But how does that fit in with your answer? And I would like to have it answered.

    Dr. ZIRSCHKY. First, sir, would you like to put me under oath?

    Mr. PARKER. No.

    Dr. ZIRSCHKY. You have questioned my veracity.

    Mr. PARKER. No. Before you start this little game, you told us that the numbers, the President's numbers that you are up here justifying did not meet the Corps' priorities.
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    Dr. ZIRSCHKY. Yes. And I also said that OMB was not happy with those numbers and desired to try to come to an accommodation on those numbers.

    Mr. PARKER. The accommodation is that the Office of Management and Budget should have told you to send up the numbers that you need to do your job that you are charged to do under your mission from the Congress of the United States, and you didn't do that.

    Dr. ZIRSCHKY. No, sir, we did. We submitted the numbers to OMB that we felt——

    Mr. PARKER. Dr. Zirschky, you can't have it both ways. Either you come up with the numbers that you know will work and that you have to have to do the projects like they should be done in a forthright manner, or you don't come up with the numbers. You decided to bring up bogus numbers from the White House through OMB, and here we are sitting here now, and you are now telling me, ''No, I am being very honest about this. This doesn't represent our priorities, but these are the numbers I have to stand here and justify.'' If that weren't the case, you would have never started off this thing about don't shoot the messenger.

    Dr. ZIRSCHKY. Sir, it is a very constrained budget request that Director Raines has put in writing, that he wants to come talk with the Members because they realize that it is a difficult situation. Maybe they didn't realize that at the time. There are hopefully no jobs that will be shut down. None of them will proceed at their optimal rate.

    I am not trying to be disingenuous. Everyone at this table is an Administration official—everyone. Everyone wearing a uniform is an Administration official. The Army works for the Executive Branch, sir. We will do our best, however, to implement the law. We don't make the budget decisions. I may not like it, I may hate it, but it is my job to at least try and explain it, and I regret that I didn't get an opportunity to explain it. Now, as for a fish——
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    Mr. PARKER. Do you want to answer the question about the——

    Mr. ZIRSCHKY. Yes, sir. I would like to answer the question.

    Mr. PARKER. I will tell you, let me ask the General. What is the validity of requesting those sums of money, $117 million for fish mitigation, $100 million for Everglades restoration? Is that part of your core mission?

    General BALLARD. Well, first of all, the short answer is yes. We do have—part of our Corps' mission—fish mitigation is one. The environmental mission is a growing portion of the Corps' mission, and it has been for a number of years. I think what is really at odds here is a balanced approach between those missions that I have for flood control, environment, et cetera.

    Mr. PARKER. Do you think the numbers that have been brought forward to this Committee are balanced?

    General BALLARD. As opposed to my other missions of flood control, no, sir.

    Mr. PARKER. Would you like to respond, doctor?

    Dr. ZIRSCHKY. Sir, the Administration—first of all—well, okay. Let me start—the Administration believes that those numbers are correct because if we do not save the fish, you don't get a second chance, and the Everglades is a vital natural resource that, again, if it is lost cannot be recovered. That is the Administration's belief. The Army put no projects on a high priority list. We did not recommend that any project get special treatment.
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    General BALLARD. I want to make sure I understood Mr. Parker's question, and I thought I did. You were asking the question of balance in between what came out of the budget as opposed to what I perceive my mission to be?

    Mr. PARKER. That is right.

    General BALLARD. Okay, sir.

    Mr. PARKER. Let me point out, I love fish. I mean, they are delicious. That is not the point. The point is is that you are talking about $217 million on these two projects, and we are juxtapositioning those against other ongoing projects that we basically zeroed out. And that has been a decision made by a bureaucrat.


    I want to ask you about a letter you received last November from T.J. Glauthier, Associate Director of OMB. In this letter, he stated that due to the continuing problem of inadequate funding for Corps projects ''we are directing the Corps to enter into only lump sum contracts with the funds provided by Congress for the unrequested new construction projects.''

    Now, I have got a list of those projects here, and you have got the letter. So I want to know whether you and others at the Army Corps: number 1, agree with this decision; and, two, consider it a sound financial approach to funding shortfalls in your agency of addressing the problems that you are experiencing now?
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    Dr. ZIRSCHKY. Well, I am not sure it is addressing shortfalls. That letter has been changed, sir. As of yesterday, the Administration has added its projects that it started in fiscal year—for fiscal year 1998 to that list. Our recommendation was that there not be such a list, but now all of the projects that were started in fiscal year '98 are on that list, including the Administration's.

    Mr. MCDADE. It is a budget that changes every day.

    Mr. PARKER. And if you don't like it today, wait till tomorrow. I have got one final thing. When you look specifically to the list provided by OMB, two of the projects on the list are from the State of Mississippi. And I know that it winds up being local politics.

    Now, neither one of these projects are in my district. But neither of these projects are new construction projects either. But they are ongoing projects. And you have got local people down there that have been working on these projects for years. It is something that you have a tremendous amount of community involvement on.

    Did anyone at the Corps inform them that these projects, are zeroed out? In general, does OMB or the Corps contact people and say we are going to zero out this project? How do you handle that?

    Dr. ZIRSCHKY. To my knowledge, sir, no one at OMB contacted anyone, nor did anyone at the Corps contact anyone. We received the list and we implemented it, and through I guess the implementation process, they would have been informed after the fact.
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    Mr. PARKER. Let me just close by saying this. My problem that I have is that—and I consider this a major change—I consider the Corps of Engineers the crown jewel of a lot of government programs. It has done tremendous things for our country both in wartime and specifically in peacetime. If you come to my part of the country, there are great things that the Corps has done. We would not be able to be the society we are today if it had not been for the Corps. And I consider its budget and these are very strong words—dishonest.

    Somewhere somebody has got to stand up to OMB and stand up to the Administration and say this is not right. You are destroying the Corps of Engineers and the projects that we have out there and what we want to do for the country and what we have to do for the country for us to survive as a nation, and to have the type of living standards for our people that we want them to have. Somebody has got to stand up.

    I have a hard time believing that Martin Lancaster would have ever put up with what is going on. He would have left. He wouldn't have come up here and justified this. I have a hard time believing that he would have. But I have to tell you I have very strong feelings about this, and there are a lot of other people—that have those same feelings.

    The problem is that we are letting it just kind of mull along. I think this Committee has a responsibility not to accept it. We have to change it and do what is right, and that is going to be going straight in the face of OMB, which is an anarchy. I mean, these people are nuts. And if you don't realize that, somebody had better realize it.

    These people are not elected officials. These people counter a legal directive that we have in law; they turn around and with a bureaucratic device, they just say, ''well, we don't have to do that.'' It is astounding to me. And I have to tell you there are going to have to be changes. Thank you, Mr. Chairman.
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    Dr. ZIRSCHKY. Sir, we did file two vigorous appeals. Again, my only—I guess I don't understand your comments about my honesty. I came here to say that the OMB is not happy with this budget request, that it is workable in all parts but Construction, General, and I think I have not acted in any way that would reflect on my integrity.

    Mr. MCDADE. The gentleman from New Jersey is recognized.

Opening Remarks of Mr. FRELINGHUYSEN

    Mr. FRELINGHUYSEN. Thank you, Mr. Chairman. The gentleman from Mississippi is a hard act to follow, Mr. Chairman. As you told me once when I got on this Committee, if you don't ask parochial questions, somebody will be replacing you as a member of Congress. I have 32 questions I would like to put forward, but I am not going to ask you, although I would like to get to the issue of congressional direction and intent.

    And as I see it from New Jersey's perspective, there has been a refusal on the part of OMB to budget for a number of important coastal and dredging projects, not only in New Jersey, but all across the United States. In my state alone, the Corps' budget, from what I understand, is some $60 million below your planned capability for these projects.

    The budget request for New Jersey's top priorities is totally inadequate. In fact, when I looked at the budget, there were so many zeroes in it I thought maybe there was a typographical error. Congress, for as long as I have been here, has told OMB and the Administration to incorporate coastal protection projects into your budget submission. The Administration continues to refuse to do so, and I want to know why.
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    What is even more galling, again this year—after a strong commitment by Vice President Gore at a press conference two years ago to address the dredging needs in the New York/New Jersey harbor—you have underfunded critical projects for the Port of New York and New Jersey. It is simply not acceptable. You cannot have it both ways and make promises you can't keep.


    For example, a critical project for our port—and there is $70 billion worth of commerce that comes into metropolitan New York and New Jersey—is the Kill Van Kull Channel Deepening Project. That project is underfunded, as I understand it, by $22 million. The Vice President was there in the flesh to promise it would move forward. Yet, you have chosen to underfund this project. Can you tell me why this project is underfunded if the Vice President was there to highlight the need to get this project moving?

    Dr. ZIRSCHKY. I guess like all of our projects, we chose not to I guess pick, within our ability projects to be fully funded. We decided that we would take the allocation we have and try and spread it out to keep as many projects as we could going. 10 million dollars is actually, in that light, a large amount compared to what other ports have gotten. I know it is much below what that project needs, and at the current funding levels it will be 2020 before that project is done.

    I would be happy to try and do all I could to advance that project. Again, my only source—I have a little bit of money left available to easily reprogram, and then I am going to have to get into—well, it is not showing up here—some of the CG money that you—Construction, General money you have provided for '98 of which I can't guarantee there will be follow-on funding in '99 to pay them back. I would love to see that project get done faster. I would love to see——
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    Mr. FRELINGHUYSEN. Well, what is the point of designating it a high priority channel if the funds aren't there to do the job, or is everybody's project designated high priority?

    Dr. ZIRSCHKY. No, sir, not by any stretch are everyone's projects high priority. $10 million was actually viewed within the context of our current constraints a large amount of money.


    Mr. FRELINGHUYSEN. I am not sure that that response or any response, quite honestly, Mr. Chairman, is going to be adequate. I am angered not only because of the dredging issue, but I am angered that critical shore protection and flood protection projects throughout my state are either zeroed out or underfunded.

    And as much as I love to participate in this process, let me compliment the General and all the good people who come from the Army Corps. We get the definite feeling that they would do whatever they could if they weren't hamstrung by, as Congressman Parker says, other Administration priorities that appear to have more political and environmental visibility than the traditional work that the Army Corps has been doing for 170 years. I mean, something has got to give here.

    I think they need to get back to your core missions and get off these high visibility projects no matter how important they are to the retention of fish populations and the Everglades. Little wonder you have a lack of resources, given the amounts of money that we learned are budgeted for the Power Marketing Authorities, who were in here the other day. And I don't want to get into another issue, but the amounts of money are just staggering.
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    That having been said, let me give you some kudos for what you are doing on FUSRAP. It was cited that there has been an orderly transition, and let me credit you also for the good work you do—you never get the credit—on a variety of Superfund programs.

    I come from the school of thought that would like the Army Corps to take over the management of all our national Superfund projects. This is not to say that you wouldn't need money to do it, but indeed there is plenty of money. Most of it is tied up in litigation and overhead. But I would love to see you get more of those resources so the job could actually get done. But if the Chairman has no objection, I would like to put my questions into the record to get responses.

    Mr. MCDADE. Without objection, so ordered.

    Mr. FRELINGHUYSEN. Thank you.

    Mr. MCDADE. We thank the gentleman from New Jersey. I am pleased to recognize my friend from California, Mr. Fazio.

Opening Remarks of Mr. Fazio

    Mr. FAZIO. Thank you, Mr. Chairman. And let me not apologize for being late because, unfortunately, we were meeting at the same time down the hall. And it tees me off that we would have this conflict. It is not Mr. McDade's fault. He has tried to deal with people from all over the country who have made an effort to be here today, and I certainly don't want to fail to accommodate them as well.
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    But it does irritate me when we have done so little this year in this Congress that on the first real day we have to have a hearing that takes the Committee's time down the hall when we have perhaps the most important issue to come before this subcommittee this year, the Corps of Engineers' budget.

    Let me say I am just as dissatisfied as my colleagues have reportedly been with the Corps' budget submission, but I am not about to shoot the messenger because I have been struggling with all of you, as you knew that you were sending us not only an inadequate but a politically indigestible budget. So there is no point in firing away at you folks any further.

    We have a problem here, and the only place we can go to solve that problem is to the full Committee for an enhanced allocation, and that won't be easy either. As we have learned today, as we try to balance the cost to the supplemental, it isn't easy to find money to move around. But I know that my colleagues in both parties are going to consider a proposal that cuts below last year's construction budget by $800 million or so a nonstarter.

    I would admit that the Committee has been probably asking more of you than you are capable of doing, and I think that is a measure of the degree to which there is demand here in Congress for these projects in an El Niño year. But neither can I agree to the Administration's budget. I mean, that is basically an insult to the priorities that have been established on a bipartisan basis. What did we lose on our bill last year, the Nevada delegation?

    Mr. MCDADE. That is about it.

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    Mr. FAZIO. Yes. And they have their special problem. So, in effect, it was unanimous. So the question is where do we go to fix this, and we don't have a lot of time or running room. And we will need to work together, and we probably ought to begin now instead of continuing to beat each other up for fun and profit.

    The Administration has got to step up and I think take more responsibility for the kind of projects that, I think, transcend the category of pork. You have got good cost benefit ratios. You have got broad political support and little environmental or taxpayer group opposition to 98 percent of what is in here.

    It is a question of following Mother Nature around and trying to clean up after her. And I can only tell you that in California the needs are growing, not diminishing. So maybe we ought to try to say what can we do to put things back together from this point. It is obviously incumbent on all of us that we do that. Dr. Zirschky, do you want to respond?

    Dr. ZIRSCHKY. I wouldn't say this has been either fun or profitable for me. I am hopeful that Director Raines will indeed discuss this issue with you so that next year we are not back up here in the same situation. It is not fun, but it is our mission.


    Mr. FAZIO. Well, I would want to just take a second to lay down the cudgel. This is my last year on this Committee after 19, and I really do want to indicate to the Corps how much I have appreciated working with all of you. Some of you I have seen almost all of those 19 years; some of you a fraction of that time.
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    But we have done a lot of good things, and it seems to me we can do a lot more, and I think the Corps' capability has got to be maintained, and enhanced in some places so that we can fulfill more of the needs the country has identified. There is somebody in the audience who is retiring as well, and that is a friend of mine, the Deputy District Engineer for Project Management from the Sacramento District, Lew Whitney. Would you stand up, Lew?

    Mr. WHITNEY. Sure.

    Mr. FAZIO. I want to thank you for your career at the Corps and your contributions to those of us in our region.

    Mr. WHITNEY. Thank you very much. I appreciate that. I appreciate the opportunity really having grown out of UCD in the 60's where everyone wanted to find out what it was they could do to do something for humanity. We had pretty broad goals at that time, and, frankly, I was delighted to be able to serve the United States through the Corps of Engineers, and I want to thank you and Mr. McDade and all the other Committee members for that opportunity. You have all been great about supporting the Corps over the years, and it meant a lot to me to have a great 30-year career with the Corps. Thank you.

    Mr. FAZIO. Thank you very much.

    Mr. MCDADE. We thank you for your public service, sir.

    Mr. FAZIO. There are a lot of other people out there like you, Lew, and despite our frustrations, I think all the Members of this Committee have friends like you in almost every district of the country who have made the kind of contributions that have really enhanced the public interest.
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    I would like to commend the Corps for its response to the '97 floods and some of the advanced measures taken on El Niño in California. I would be more than happy to yield to anyone who would like to briefly indicate for the Committee just how much we have accomplished in the last 12 months. I know General Capka is here.

    General BALLARD. Sir, I would like to have General Capka to address that. I visited out there several times, as you know, but General Capka and his great team has been on the front line day to day. So, Rick, if you would step up?

    Mr. FAZIO. They have done a great job. I would like to just have the Committee get a sense of what the problem was and how much ground we have covered in a relatively short period of time.

    General CAPKA. Thank you very much, sir, and I appreciate the opportunity. And, of course, I will talk a little bit about El Niño and just be very brief. But those comments are interim comments since we are still in the middle of the El Niño winter out in California and the West so the books haven't been closed on that.

    But unlike last winter, the El Niño hasn't been confined to just central and northern California. It has impacted the entire state. From the coastal structures and channels on the coast to the interior, levee systems have been affected. And I am confident that we are going to see more before the season is over, and we will be seeing more as waters recede from the levees, and we will be able to take a better look.
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    The good news though is that the fruits of our last year's response have paid great dividends. As you know, the preparation for El Niño began with our recovery from last January's floods. Together with your decisive efforts and that of the entire Committee, the cooperation and efforts of other Federal and state agencies working together, we were able to complete contracts worth more than $120 million, to repair more than 600 damaged levee sites in less than 11 months.

    Additionally, we worked closely with other Federal, state, and local agencies to coordinate response plans in anticipation of this year's El Niño winter. And I would also like to say that even in the regulatory function we got our act together, and all the districts had regional general permits in place to facilitate response to anything that might happen during the winter, and it has worked very well.

    The winter, however, has brought additional challenges. We have had to respond to more than 45 flood fights as a result of El Niño, many on and most on non-Federal levees at a cost of about $20 million; 30 technical assistance requests. We have had other work for others. We have done other things for about $5 million.

    But before the winter is over, we have got the snowpack to look at. If we have some warm rains combined with that, we will have some challenges left, but it was a real sobering experience out in California to know that we have got a Federal team, a state team, a local team, and the folks back here in Washington tugging on the rope in the same direction.

    Mr. FAZIO. Well, I think everybody in California on a bipartisan basis certainly appreciates what has been accomplished, and I think the cooperation with state and local government really helped facilitate that. I want to thank the Chairman and, even though they are not here, the Chairman and Ranking Member on the other side for the report language that went into the bill that we adopted last October, because it allowed for Public Law 84–99 money to be spent on what had been, in the opinion of some, problems that had preceded last winter's emergency. And that has permitted about $25 million—cost shared, with state and local government putting up 25 percent—to be expended. Would you touch on how that is working and when we hope to accomplish our goals there?
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    General CAPKA. Yes, sir. As you pointed out, the work that we did last year in the immediate aftermath of the floods was focused on conditions that weren't preexisting; in other words, restoring the system back to its original shape in December of '96. The cost shared 84–99 work is designed to look at the more challenging work that perhaps had preexisting conditions.

    And in order to execute this, because there is some sense of urgency to get that work done, it is being done not in a business-as-usual mode. We are planning to get work under contract this year for many of the projects, and some of those will be finished before next winter, the 1st of November '98. And we anticipate that all the work under this expanded Public Law 84–99 will be done before 1 November of '99. And, again, it has required the same cooperation among all agencies—Federal, state, and local—in order to execute this properly.

    Mr. FAZIO. It is unprecedented for us to have local cost share on what has been emergency money, flood-fighting money, under 84–99. For the record, it seems to me it was worth it to those communities to belly up to the bar and put some money down in order to attract the Federal money, and I certainly hope we will make more use of this flexibility in the future and certainly in other parts of the country.

    We almost eliminated the ESA for purposes of flood control projects last year. Would you tell the Committee whether or not environmental factors have played a part in the work you have just discussed with us, and in what way have we made them less of a factor in slowing down our work?
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    General CAPKA. Well, sir, certainly the environmental piece is a major consideration when we design any kind of work and execute that work. In the aftermath of last year's floods, we knew that we had to get a lot of work done very quickly. And some of that Federal agency cooperation that I mentioned to you had to do with working very carefully with the Fish and Wildlife community, with California Fish and Game, and a number of those folks who are interested in precisely what you have pointed out. But by working with them very carefully up front, we were able to obviate what could have been some major problems. And that particular issue did not hold up our execution.

    Mr. FAZIO. I understand the Fish and Wildlife Service is cutting its normal 135-day assessment to 45 days on this Public Law 84–99 work. Is that correct?

    General CAPKA. Yes, sir. In fact, we are working that issue with them right now. Normally, it is 135 days to turn around response on some of the issues, and we are looking to push that to 45.

    Mr. FAZIO. Not longer?

    General CAPKA. Yes, sir. Some of those are very difficult.

    Mr. FAZIO. Do we seem to have their attention at the moment?
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    General CAPKA. Yes, sir. The situation has everybody's attention.


    Mr. FAZIO. Would you give the Committee some sort of an evaluation of where we are on the five phase Sacramento River Project that was put in law in 1990 after the floods of 1986? We were in some cases embarrassed that some of that work hadn't been completed by the floods of last winter. But could you give us a status report?

    General CAPKA. Yes, sir. Last year, in fact, you asked us if it was possible to accelerate some of the delivery of that work, and I am happy to report that in that intervening time we have been successful in positioning that work to be accelerated for the most part by an entire year, if not more.

    We now expect to have all construction complete by September of the year 2000 with all levee work essentially done by December of '99. That, of course, is dependent upon the availability of funding to do that work. But we are in a position to execute, as I have described, subject to that adequate funding. And if you would like, I could go through each phase individually.

    Mr. FAZIO. Would you do that for the record for the benefit of the Committee?

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    General CAPKA. Yes, sir, I will.

    [The information follows:]

    "The Official Committee record contains additional material here."


    Mr. FAZIO. I appreciate that. We have a comprehensive study of the Sacramento-San Joaquin River Basins currently underway. I think it is a joint state-Federal study. Obviously, this is our attempt to get sort of an assessment as to the flood system that is in place; some of it obviously is largely Federal, but some of it not. Could you give us your estimate of when that can be completed? Obviously, as usual, we are in a hurry and want to get it done as quickly as we can so we can begin to further pursue the Corps' capability.

    General CAPKA. Yes, sir. As you are well aware, this particular study was initiated as a result of the overwhelming floods that we had last January that affected not just one of those watersheds, but the entire watershed of the Central Valley and really attracted our attention to the requirement to have an overall, comprehensive look at the system.

    That is underway. In fact, we have an initial report due to you here in Congress by April of next year, an 18-month report, and that report will provide information on some hydraulic and hydrologic modeling, post-flood assessments, and they are fully funded. This particular piece—$4.5 million. We will have that work to you. We will have the initial assessment of what we will have for a blueprint and how to attack the problems that are associated with what damage prevention. We expect to deliver that report April of '99.
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    Mr. FAZIO. Well, I realize that there will be a large state contribution. We may see a bond act in California for flood control activity, and for those who are concerned that we just fix old and maybe outdated, antiquated project solutions, we are going to be looking at meander builds and other nonstructural solutions in part of the region. And that is all going to be encompassed in the study that the Corps and the state are working on.

    General CAPKA. Absolutely, sir. There is no alternative that will be left out of the equation, whether it is a structural alternative, a nonstructural alternative. They will be all considered as far as the best fit for a specific problem.


    Mr. FAZIO. I realize that I am taking a lot of time here. There is a lot to talk about. I apologize to my colleagues, but we have in the Sacramento area the largest urban community threatened by flooding in the nation. Certainly parts of Los Angeles may be equally vulnerable but not the entire community. We are making tremendous progress in Los Angeles and in Orange County as we deal with some of their ongoing concerns.

    But in Sacramento in the American River Floodway, we have yet to really reach consensus on what would be best for us. The Auburn Dam was before the Congress last year and did not seem to have broad support. We have recently had a Sacramento Area Flood Control Agency vote, which urged us to proceed with changes in the way Folsom Dam is configured and improve levees downstream of that facility.

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    Could you explain the differences between the work you have undertaken already to make a recommendation as to the NED project that we supported in the last Congress and the work that is now being discussed as an alternative, a fallback that might come before this Congress as part of a WRDA amendment?

    Dr. ZIRSCHKY. I am sorry. Would you repeat the question?

    Mr. FAZIO. No.

    Dr. ZIRSCHKY. Is it about how we would handle the WRDA issue on American River?

    Mr. FAZIO. Yes. What can you do for us, Dr. Zirschky, to get WRDA to take care of our problems on the American River?

    Dr. ZIRSCHKY. We actually had a meeting on that yesterday afternoon at OMB. The Administration does want to support that project subject to, of course, all the budget concerns. One of the things—these are just considerations, no decisions have been made—we are looking at is to do a two-part authorization.

    Because we are looking for a WRDA bill of about $2 billion, we would probably want to divide up that project and in '98 seek authorization for modifications to Folsom Dam and in 2000 perhaps seek authorization for increasing levees. But the discussions are extremely preliminary, and, sir, if you have specific views on what you would like——

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    Mr. FAZIO. Well, it is very important to the community that we find consensus, and you know how hard that has been. But we had a common element that was included in the last authorization that would have required $9.4 million in funding from the Administration to keep faith with our consensus; instead, it was funded at $1 million in this year's budget.

    I guess that is just one of a thousand cuts, so to speak, that we have all felt. But in this case, it is sort of indicative of whether or not we are serious about going on and dealing with the problem in general. We know the common elements are just the beginning, and we hope that we can bring you a community-based and congressional-delegation-agreed-upon solution that would perhaps be a large project but far less expensive than this Auburn Dam proposal that the Congress rejected last year. Your thoughts of dividing that into two are based upon what?

    Dr. ZIRSCHKY. Simply, the Administration would like to tentatively limit a WRDA bill to about $2 billion on authorized projects, and the total cost of the levee raising and Folsom Dam could become a significant chunk of that amount so we are going to try and consider spreading that out if we cannot get some consideration for a higher authorization bill.

    Mr. FAZIO. Is that something that is still on the table down at the OMB?

    Dr. ZIRSCHKY. Yes. We have submitted draft legislation. We are still working——

    Mr. FAZIO. If it is $3 billion, it is a veto; if it is $2 billion, it will be signed?
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    Dr. ZIRSCHKY. I have a feeling, sir, that decision will be made when the bill shows up in final form.

    Mr. FAZIO. So do I, so I would say we should go for it. I am not asking you to comment, but I am just telling you this Congressman's reaction.

    Dr. ZIRSCHKY. This Administration would prefer a $2 billion WRDA bill at this time. I have given similar advice to anybody who has asked me.

    Mr. FAZIO. How much demand is there for that $2 billion?

    Dr. ZIRSCHKY. We could probably on a handful of projects use up that $2 billion. Our problem isn't so much authorization, it is how we fund it in the future, which is——

    Mr. FAZIO. Right. But here we are, and I don't think anybody disputes my assessment of the flood threat. Do you know how much it would cost if we lost $16 billion of assessed valued property? What are we talking about here? What are we doing this for? We are doing this to protect life and limb and the Federal taxpayers' vulnerability, aren't we?

    Dr. ZIRSCHKY. Yes, sir.

    Mr. FAZIO. But we can't get there from here?

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    Dr. ZIRSCHKY. Sir, I hope we can get an agreement on future funding levels to allow us to do all the critical work, but we are not there yet, and we need your help to get there. I know——

    Mr. FAZIO. Well, we will do better in Congress but we have a long way to go. We admit that. And our appetite does exceed our ability to feed it. But at the same time, I think we all are making the same point in many different specific ways, and that is the need is out there. We are not kidding. This isn't just to make somebody we know wealthy or something. This is because the people we represent are threatened, and I think this is a prime example.

    I would love to be able to give you a project that is far less expensive than the one we were toying with, and yet we can't even find a way to get that into the WRDA this year if we could reach agreement? Gosh, I find that pennywise and pound foolish to say the least. Mr. Chairman, I have a number of other issues that I will put in the record at this point.

    Mr. MCDADE. Without objection.

    Mr. FAZIO. And I do appreciate the time of my colleagues. The anguish we all feel is evident. Again, I know the Corps would like to do more and would like to have asked for more, and I hope we can work together to find a way to patch this together to the best of our mutual ability.

    Mr. MCDADE. The Chair recognizes the gentleman from Arkansas, Mr. Dickey.
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Opening Remarks of Mr. Dickey

    Mr. DICKEY. Thank you, Mr. Chairman, and I don't plan to take the rest of the afternoon as Mr. Fazio did.

    Mr. FAZIO. Mr. Dickey, I was actually restrained, and I have to apologize.

    Mr. DICKEY. Well, I finally——

    Mr. FAZIO. I could have really gotten carried away.


    Mr. DICKEY. All right. Dr. Zirschky, I want to tell you I believe what you are saying is——

    Mr. ZIRSCHKY. Thank you.

    Mr. DICKEY [continuing]. What you mean, and you have to consider the source. I wish you were here when Mr. Parker starts embellishing some of his stories and tries to play them off as true. We have the same problem with him. You have got a problem though and that is that you are trying to defend an insult, and I think that is what we have here. And I don't quite understand it myself. I don't understand how we can get about it, but I want to talk specifically about something, and maybe we can work into more general things. Montgomery Point Lock and Dam is on the Arkansas River. Are you familiar with it?
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    Dr. ZIRSCHKY. Yes, sir.

    Mr. DICKEY. Can you briefly tell this Committee what the present status is of construction on that lock and dam?

    Dr. ZIRSCHKY. Currently, sir, construction has been stopped on that project. The reasons are still under review. It has been—one view is that it is from lack of funding, another is from high water. We are still sorting that out. But we currently do not have sufficient funds to restart that project and will need to do a reprogramming to get it back online.

    Mr. DICKEY. What is this Committee going to be required to do in that reprogramming process?

    Dr. ZIRSCHKY. We just had sort of a—I guess it has been a couple hours ago now—the reprogramming rules are very difficult. We would notify the Committee of our desires to reprogram and hope for the Committee's approval.

    Mr. DICKEY. Is there a dollar amount?

    Dr. ZIRSCHKY. I think we need probably at least $30 million would be my guess.

    Mr. DICKEY. $30 million more plus the reprogramming?
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    Dr. ZIRSCHKY. No, the reprogramming of $30 million to get the job back up and running.

    Mr. DICKEY. Okay. Now, do you need that for the '99 budget?

    Dr. ZIRSCHKY. No. I have to use '98 funds to do that, sir.

    Mr. DICKEY. Okay. And how much do you want for the '99 budget to keep it going at its anticipated pace?

    Dr. ZIRSCHKY. Okay. I have the exact numbers here for that. There was a disclaimer that, again, we will submit for the record, but subject to that, we have asked for $19 million, and we believe we could effectively use $60 million.

    Mr. DICKEY. Now, you take 60 minus $19 million or are you talking about $79 million?

    Dr. ZIRSCHKY. No. I am talking we would need another $41 million.

    Mr. DICKEY. All right. What has been the impact on the completion schedule, as stated in the contract with the builder, of the amount in the Administration's 1999 budget request, as well as the Administration's proposed subsequent budgets?

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    Dr. ZIRSCHKY. I don't know about the contract, but I know we have slipped the schedule about four more years because of our funding shortfalls.

    Mr. DICKEY. Is there a problem with the contractor?

    Dr. ZIRSCHKY. I would prefer—because with contractors those get worked out on a different channel if there is a contract dispute through the acquisition folks. We would prefer if we could to answer that one for the record?

    [The information follows:]

    There is not any known problem with the contractor resuming work once funds are made available.


    Mr. DICKEY. Okay. That will be fine. All right. Now, we have a project in Arkansas called the Grand Prairie Irrigation Project and the Bayou Meto Basin Project. Are you familiar with that?

    Dr. ZIRSCHKY. Yes, sir.

    Mr. DICKEY. There is $11.5 million for construction in Grand Prairie and $2.5 million for the Bayou Meto study. Is that adequate for this coming year?

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    Dr. ZIRSCHKY. Yes, sir, I believe so on both of those projects.


    Mr. DICKEY. And then there is a Boeuf-Tensas study of $500,000. Now, PED, is that a study?

    Dr. ZIRSCHKY. Oh, that is engineering design, sir.

    Mr. DICKEY. And that is not a study?

    Dr. ZIRSCHKY. No. I mean, there may be some studies to help us do the design, but it is mostly design, sir. It is engineering work.

    Mr. DICKEY. Do we have a study for Boeuf-Tensas in Arkansas?

    Dr. ZIRSCHKY. Zero.

    Mr. DICKEY. What is the recommendation? Is there a recommendation, General Fuhrman?

    General FUHRMAN. The capability for that is $1.8 million, Congressman.

    Mr. DICKEY. In the coming year?
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    General FUHRMAN. In '99, yes.

    Mr. DICKEY. For the study?

    General FUHRMAN. Yes.

    Mr. DICKEY. Assuming I don't have enough clout from way down on this end of the table, what is the least amount that we could get by with on that study?

    General BALLARD. Let me defer that to——

    General FUHRMAN. We will need to provide that for the record.

    [The information follows:]

    Sir, the minimum amount that could be used effectively in FY 1999 is $500,000.


    Mr. DICKEY. Okay. Good. Now, let me ask General Anderson something. Are you awake over there, General Anderson?

    General ANDERSON. Yes, sir.
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    Mr. DICKEY. Briefly describe the condition of the levees on the Mississippi River as to what storm level or project flood level these levees could protect against, and what would be the damage impact if we were to face a major storm such as a 100-year or more flood?

    General ANDERSON. Yes, sir. At this time, the Mississippi River levees could not sustain the project flood. It was based upon what we experienced in 1927 and some other hydrologic effects. We are working towards meeting project completion on the Mississippi River and Tributaries Project as quickly as we can, but we do at this time have deficient sections of levee. They are deficient in both height and section. They are deficient with respect to seepage problems that require remedy, and that work remains to be done. And without correcting those deficiencies, then we find ourselves in a flood-fighting situation as we face potential project flood flows.

    Mr. DICKEY. Now, is that taken care of in this budget or in this insult, excuse me?

    General ANDERSON. The Mississippi River and Tributaries amount in this particular budget is $280 million subject to the previously made caveats and limitations. We have the capability in fiscal year '99 for $330 million.


    Mr. DICKEY. Okay. Thank you, sir. Let me go one step further. General Fuhrman, can we continue on Montgomery Point Lock and Dam? Can we continue?
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    General FUHRMAN. With the reprogramming of money and if we have a minimum of about $44 million in FY '99, we can continue.

    Mr. DICKEY. But other than that, it is going to be a stoppage?

    General FUHRMAN. Yes, sir. If we do not have that money, we will have to stop. If I cannot reprogram those dollars into that program, we will have to stop it.

    Mr. DICKEY. Now, we have already had the ribbon-cutting ceremony, haven't we?

    General FUHRMAN. Yes, we have.

    Mr. DICKEY. How can you stop something where we have gone on and christened it?

    General FUHRMAN. Well, it is our desire not to stop it.

    Mr. DICKEY. All right.

    Mr. MCDADE. Would you yield, Jay?

    Mr. DICKEY. Yes, sir.

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    Mr. MCDADE. I just want to clarify the number in the next fiscal year on the gentleman's project.

    Mr. DICKEY It is $41 million.

    Mr. MCDADE. I thought I heard $40 million at one point and $30 million at another.

    Dr. ZIRSCHKY. $30 million is for this year, sir.

    General FUHRMAN. $30 million is what is required to be reprogrammed in FY '98.

    Mr. MCDADE. And then $40——

    General FUHRMAN. And a minimum of $44 million in FY '99 with a capability of $60 million.

    Mr. DICKEY. Now, General Fuhrman, would that $44 million replenish the reprogrammed money or not? Would you just have to deal with that some other way?

    General FUHRMAN. We will have to deal with that somewhere else.

    Mr. DICKEY. I want to thank General Ballard, Dr. Zirschky, General Fuhrman, and Mr. Caver, and General Anderson. You all have been very kind to answer all my questions, and I think we are all in this thing together. Let us just hold hands while we go through it. Thank you, Mr. Chairman. I have no further questions.
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    Mr. MCDADE. I thank the gentleman from Arkansas. General Ballard, let me touch on a couple of points with you. The Corps has about 1,200 facilities to maintain around the country, and a lot of them have reached beyond their designed capable life. They are still going, correct?

    General BALLARD. I would say that is an accurate assessment, sir.

    Mr. MCDADE. And we are proud of the work that you have done and the fact that they are still onstream. When I look at the operation and maintenance budget, you are $137 million below last year in this account. Is that a correct number?

    General BALLARD. That is about right, sir.

    Mr. MCDADE. What kind of number do you need, General, to be able to efficiently maintain and care for the facilities that you are responsible for?

    General BALLARD. I will turn it——

    General FUHRMAN. Our recommended budget was $1.8 billion.

    General BALLARD. Was this O & M you are talking about?
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    Mr. MCDADE. Yes, operation and maintenance. What did you ask from OMB?

    General FUHRMAN. $1.8 billion.

    Mr. MCDADE. And what did you get? Is it $137 million below the——

    General FUHRMAN. Yes.


    Mr. MCDADE. You were cut $137 million somewhere along the line. Okay. Let me, General Ballard, if I may, turn to the FUSRAP program, which we are all very interested in and in which this Committee has a special interest.

    General BALLARD. Okay, sir.

    Mr. MCDADE. I have heard that there have been some procedural roadblocks put in the way of the project as a result of DOE's conversations with the Corps, that there are some colloquies back and forth that are not advancing the project. Would that be an apt characterization on what is happening?

    General BALLARD. I wouldn't call them roadblocks. Let me say that there have been some difficulties in addressing certain issues; primarily the issues involving real estate, some regulatory issues in terms of authority to designate new sites if need be, some issues that speak to the condition of the status of cleanup of previous sites. We currently are involved and working with DOE and OMB to try to reach some agreements on a memorandum of understanding, if I understand your question correctly.
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    Mr. MCDADE. So the discussion is still ongoing. It has not been settled?

    General BALLARD. No, sir, not yet.

    Mr. MCDADE. Does it need legal clarification or a memorandum of understanding? What do you need to get this behind you?

    General BALLARD. I think that the letter that the Committee submitted as to clarification of the original language was sufficient enough as far as I was concerned. I clearly understood the intent of Congress. I would say it probably would need some agreements on the part of DOE to come to the table and seriously negotiate on this issue. OMB is assisting us in that endeavor.

    Mr. MCDADE. Yes, but you are still kind of one party at the table, are you?

    General BALLARD. Yes, sir. I think that would be accurate.

    Dr. ZIRSCHKY. We are in agreement with OMB. The Corps has now reached agreement with OMB as to where we would like it to end up. So I guess there is two out of three of us agreeing so far.

    Mr. MCDADE. You mean OMB has not been able to bring DOE to the table?
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    Dr. ZIRSCHKY. I think, sir, they were a bit surprised in an answer that was given to this Committee a few weeks ago.

    Mr. FAZIO. OMB was?

    Dr. ZIRSCHKY. Yes, sir.

    Mr. MCDADE. General, we are going to invite you to keep us informed as to how this thing is progressing because we don't want to see any artificial roadblocks. We want cooperation. We want to see the Corps solve this problem. We are happy that you have it. We don't want to see it impeded. We have another vote on, I am informed. Are there any other questions from the Members? The gentleman from Indiana, Mr. Visclosky, is recognized.

    Mr. VISCLOSKY. Mr. Chairman, simply to state that relative to earlier comments, I have found the Corps offices—and particularly the regional office in Chicago—to be very dedicated, very flexible, very hardworking, and I personally think understaffed. That is my comment. That is not theirs.

    I think you have greater capacity, and I did not bring up the score on your strategic plan earlier to be critical, but I don't see how anybody could expect you to come up with a plan given the way you are tugged and pulled with these various budgetary figures. I think it is an impossible task that you have been dealt here. So that was not meant to be a negative comment.

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    And I will stop while I am ahead, except to say you do many useful projects that preserve the environment, save lives, and make our economy more efficient. And you deserve the dollars you are capable of spending.

    Dr. ZIRSCHKY. Thank you.


    Mr. MCDADE. Gentlemen, we have additional questions, which we will be submitting to you. We appreciate your attention to them and frank answers. Thank you for being here. We appreciate all your work on behalf of the country. The Committee is in recess till tomorrow at ten o'clock.

    [The questions and answers for the record follow:]

    "The Official Committee record contains additional material here."