04/01 CORPS ISSUES ITS CIVIL WORKS PLAN FOR NEXT FIVE YEARS

Under the best of scenarios, the nation’s civil works program would increase by only 2 percent per year between FY ‘07 and FY ’11. Earlier this month, the Corps provided Congress with three scenarios for funding its programs over the next five years. Each is budget policy neutral. Fir example, none assumes that the Office of Management and Budget restricts funding for new beach projects (as it has tried to do for each of the last 10 fiscal years) or that it sharply restricts funding fir new projects or requires projects to meet a benefit-cost ratio higher than that required by current law. In short, even the most pessimistic scenario in the five-year plan ignores OMB’s version of reality. Nevertheless, the Corps would not have been allowed to release its plan to Congress without OMB’s approval.

Since most businesses use the middle scenario when projecting revenue needs for the future, here’s what that view offers for the Corps. Compared to a $5.3 billion program as approved by Congress for the current fiscal year, the middle scenario drops FY ’07 spending to $4.7 billion and then drops its below $4.6 billion for the remaining four years. The Corps’ General Investigations program for studies continues to get starved at $94 million in FY ’07 dropping to $90 million by FY ’11. In fact, ever funding category drops at a similar pace, including construction, operations and maintenance, and emergency spending. The scenario provides for an additional $5 million for unspecific studies in FY ‘07 rising to nearly $45 million in FY 11. Increases such as this one and the one cited in the next paragraph occur solely because the five-year plan is strong on specifics for the next year or two only, leaving unspecified projects to fill in the flat-line gap for the remaining years.

Under the middle scenario, the following coastal studies would be funded over at least a portion of the five-year period: California Coastal Sediment Master Plan; Chesapeake Shoreline Erosion; Currituck Sound (NC); Edisto Island (SC); Dismal Swamp (VA); Louisiana Coastal Area (2 studies); Hereford to Cape May Inlet (NJ); Sabine Pass to Galveston Pass (TX). With the caveat that this plan is budget neutral, the following coastal construction projects would receive funding: Rockaway Inlet to Norton Point (NY); Barnegat Inlet to Little Egg Harbor (NJ); Chicago Shoreline (IL); Fire Island Inlet to Montauk Point (NY); NY and NJ Harbor; Oakland Harbor; Port of Long Beach (CA); Townsends Inlet to Cape May Inlet (NJ). In addition, the scenario lists an additional $55 million in unspecified construction projects that could be accommodated by this scenario of FY ’08, rising to a staggering $508 million by FY ’11.

Only under the high scenario would FY ’07 spending increase over the $5.3 billion appropriated by Congress, and then only by about 2 percent a year. It’s clear that OMB has no problem funding highways and aviation at growing levels, even though those programs are not based on a single study showing they produce benefits that exceed their costs.