Program Development & Management: U.S. Army Civil Works Program Gary Loew, Chief, Programs...

Program Development & Management:U.S. Army Civil Works Program

Program Development & Management:U.S. Army Civil Works Program

Gary Loew, Chief, Programs Integration DivisionDirectorate of Civil WorksU.S. Army Corps of Engineers

National Waterways ConferenceNational Waterways ConferenceAnnual MeetingAnnual Meeting

November 7-9, 2007November 7-9, 2007

One Corps, Serving the Army and the Nation

OutlineOutline

• FY07 Accomplishments• FY08 Appropriations• FY09 Budget• Future Budget Trends


FY 07 ACCOMPLISMENTS FY 07 ACCOMPLISMENTS

Executed about $6.8 billion in FY07

$1.6 bil obligated for NOLA System Repair & Strengthening 5 Planning and 15 Construction project completions scheduled Reprogrammings:

* Investigations = $3.5 mil * Construction = $36.9 mil * O&M = $48.2 mil * MR&T = $9.9 mil

Non-emergency Funding Carryover reduced to ~ $1 bil “Payback” requirement reduced to 75 projects for $147 mil Almost all new contracts fully funded * 135 continuing contracts today (as of 30 Jun) * 18 awarded in FY06 * 1 awarded in FY07


FY 07 ACCOMPLISMENTS (cont) FY 07 ACCOMPLISMENTS (cont)

Timely guidance and funding to FieldTimely budget submissions to AdministrationTimely information and response to CongressProgress on 5 Demonstration Watershed StudiesRisk Calculation, Risk Management, Risk CommunicationPrioritization, Planning and Construction of Portfolio of Dams with Dam Safety issues; applied also to levesLevee Certification Policy and Federal Levee data baseContinued rehab on major projects; more efficient fundingStrategic Planning & Plan implementationWRDA


FY 07 ACCOMPLISMENTS (cont) FY 07 ACCOMPLISMENTS (cont)

CIVIL WORKS CUSTOMER SURVEY

Scale Mean

Attitude 4.33

Services 4.27

Staff 4.41

Timeliness 3.90

Cost 3.91

Communication 4.29

Overall 4.20


TRENDS TO WATCH TRENDS TO WATCH

Cost of Infrastructure RecapitalizationImproved Inspection TechniquesModern Design StandardsCost of meeting ESA and other legal requirements

Cost of ConstructionFuel, Steel, ConcreteExpanding worldwide demand

Continuing Pressure on BudgetEntitlement Programs Medicare, Medicaid, Social Security


FY08 AppropriationsFY08 Appropriations


Budget & Appns ComparisonBudget & Appns Comparison

FY06 FY07 FY08 FY09 $ Millions

Investigations 95 94 90Operation & Maint.1,979 2,258 2471 Construction 1,637 1,555 1523 ???Miss. River & Tribs. 270 278 260Regulatory Program 160 173 180 F.C. & Coastal Emer.70 81 40F.U.S.R.A.P. 140 130 130 Expenses 162 164 177ASA(CW) - (6) (6)Total 4,513 4,733 4,871Appn 5,329 5,334 5,448Senate

5,584 HouseAppn>Budget +216 +401~+700


FY08 AppropriationLegislation Status

FY08 AppropriationLegislation Status

House Bill – HR 2641, 17 Jul 07 --Report 110-185 Parts I&II

Senate Bill – S 1751, 9 Jul 07 (Cmte passed) --Report 110-127 Continuing Resolutions

--CRA #1 (HJR #52) 1 Oct – 16 Nov --CRA #2 -- 17 Nov - ~14 Dec

--CRA #3 -- ? Final Resolution Possibilities

-- Conference – Conference House Bill and Senate Cmte Bill (~Nov-Mar?) or -- Omnibus Bill or Joint Continuing Res. (Jan-Mar?)

--Final Bill about 85% “fat free”


FY05 E&WD ACT CW EARMARKS As a % of the FY05 AppropriationFY05 E&WD ACT CW EARMARKS As a % of the FY05 Appropriation

87%

13%

Total Approp.

Earmarks


WRDA StatusWRDA Status

23 Oct -- Sent to President 2 Nov – President Vetoed 6 Nov -- House Overode Veto 361-54 7 Nov – Senate??


SUPPLEMENTAL APPRORIATIONS ARE

IMPORTANT TO PROJECT PERFORMANCE

SUPPLEMENTAL APPRORIATIONS ARE

IMPORTANT TO PROJECT PERFORMANCE


Four FY05-7 Emergency Supplementals

Four FY05-7 Emergency Supplementals

Approp $ Millions Four Bills FCCE $7,169.0 P.L. 109-62 (FY 05)GI 48.8 P.L. 109-148 (FY 06)CG 687.3 P.L. 109-234 (FY 06)O&M 533.7 P.L. 110-228 (FY 07)MR&T 153.7 GE 1.6

TOTAL $8,594.1


FY07 Emergency Supplemental PL 110-28

FY07 Emergency Supplemental PL 110-28

Approp $ Millions Comments

FCCE $1,300.0 LPV & WBV-to auth level107.7 Mississippi

128.4 Various damaged projects 11.7 Missouri R. Flood

3.7 Nor’easter Flood2.6 Texas7.0 Drought Assistance

GI 8.0

CG 36.5 SELA & Nor’easter Flood

O&M 3.0 Katrina-dredging, Alabama-Coosa R.TOTAL $1,608.7


FY09 Budget FY09 Budget


FY09 Civil Works Budget FY09 Civil Works Budget

Supports the President’s Overall Budget Priorities:– Continue Long Term Economic

Growth – Win the Global War on

Terrorism– Secure the Homeland

• Supports Mission Priorities– Commercial Navigation– Flood & Coastal Storm Damage

Reduction– Aquatic Ecosystem Restoration


FY 09 Program Process FY 09 Program Process

Apply Policy Direction and Guidance • Rank competing investments in each business program• Demonstrate improved outcomes from added increments Establish Amounts for Programs with Internal Performance Metrics• General Expenses; Regulatory; Flood Control & Coastal Emergencies; Recreation; Environmental Stewardship; FUSRAPDevelop Performance Based Metrics for projects in competing business lines:• Initial level (No new work, phases or contracts, previously budgeted projects only)• Categorize and Prioritize CG projects into Priority levels • Add Performance Base High Return items and increments for GI and O&M itemsAdd to Highest Priority, ongoing projects & contracts


Budgeting MetricsBudgeting Metrics

Main Ranking Criteria for Business Lines• Flood Risk Mgmt. (FRM) - People in 100-year

floodplain• FRM- Flood “Risk” Index• FRM, Navigation - Dam safety & seepage stability• FRM, Navigation, Hydropower – Benefit/Cost Ratio• Navigation - Tonnage movements• Navigation, Hydropower - “Risk” Assessments• Environmental - Loss prevention for significant

natural resources• All Business Lines – New or Continuing; Years to

Complete• All Investigations (Studies) - Watershed Elements • All Construction – Endangered Species Act &

compliance needs• ALL O&M - Safety, Caretaker, Compliance,

Subsistence


FY 08 Construction Budget – National Priority Projects

FY 08 Construction Budget – National Priority Projects

Sims Bayou

Oakland Harbor

OlmstedLock & Dam

New York-New

Jersey Harbor

Navigtion

Flood Damage Reduction

Aquatic Ecosystem Restoration

S. Fla. Everglades

Upper Miss.R.Restoration


Budget Arithmetic – FY08Budget Arithmetic – FY08

FY08 Civil Works Budget Ceiling $4,800 million

Allocate GE, REG, FCCE, REC, FUSRAP… - 900Allocate Base O&M (~75% of required) - 1,800Essential Dam Safety - 500Assign National Priorities - 400Continuing Construction at Base Level - 700Planning Studies - 100Minimum Essential Allocation = - $4,400

Left for all other CW Projects & Programs ~$ 400 million

THAT’S IT!


Future Budget TrendsFuture Budget Trends


Budgeting from the TopBudgeting from the Top

• Goal and Performance-Based Budgets– Define strategy, objectives and performance metrics– Budget to achieve those objectives– Systems budgeting—national, regional, local– More emphasis on program, system and regional benefits;– Less emphasis on individual project benefits

• More emphasis on multi-dimensional benefits• Changing focus

– HQs focus on capital decisions, future revenue, funding strategy

– Field will have more influence over funding for execution


Five Year PlanningFive Year Planning

ExampleFY08-12 Five Year Plan

• Construction Wedge, Enhanced Plan, FY08-12• $2.2 bil available for new starts in next 5 years• 79 eligible projects @ $9.5 bil• 131 other projects @ $6 bil

• If past funding trends continue we have ~15%-23% of funds needed for approved projects


ExampleGoal-Based Budgeting for

Navigation

ExampleGoal-Based Budgeting for

Navigation

Goal: Maintain projects to meet present and future needs

– Objective: Maintain Ports• PM 1 – Percent time navigation channels are

available to commercial users– high-commercial traffic (>10 mil tons @~95%?)– medium traffic (1-10 mil tons @~85%?)

• PM 2 – Percent project features that exceed Facilities Condition Index (FCI)

• PM 3 – O&M cost per ton cargo shipped

*PM = Performance Measure


Example (cont)Goal-Based Budgeting for

Navigation

Example (cont)Goal-Based Budgeting for

Navigation

Goal: Maintain projects to meet present and future needs

– Objective: Maintain Inland Navigation Channels• PM 1 – Segment Availability; no instances where

mechanical failure results in lock closure >24 hours• PM 2 – Percent high commercial use segments with

sufficient preventive maintenance to achieve good service level

• PM 3 – Total O&M funds/segment ton-mile (5-yr avg)• PM 4 – Percent of funding to construct and expand

projects allocated to high return investments• PM 5 – Percent of navigation asset inventory with

recent structural or operational risk assessments

*PM = Performance Measure


Communicating OutcomesCommunicating Outcomes

• Budget is developed to achieve program objectives

• USACE will be able to display and communicate on a segment, system and national basis if funds budgeted and appropriated will achieve objectives

• Thru the 5-yr Plan, USACE will be able to forecast improving or worsening conditions– By system, region and nation– We will be able to forecast progress (or not)

towards national goals


Risks and ChallengesRisks and Challenges

• System Objectives

• Systems Analysis• “High Commercial Traffic” navigation

channels and segments

• Segment focus vs Systems focus


Industry RoleIndustry Role

• Grow with us as we learn to better communicate importance of infrastructure to the nation’s economic well being, national defense and quality of life.

• Stay engaged as we examine funding sources and improve our decision processes

– Systems objectives and benefits– Future planning for riverine and coastal systems– Measurement

• Support system, regional and national needs



EARMARKSDefinition

EARMARKSDefinition

• Reference: January 25, 2007 OMB Memo M-07-09• It is an Earmark IF:

– A) Add-ons. The Administration asks for $100 million … and Congress provides $110 million and places restrictions (such as site-specific locations) on the additional $10 million, the additional $10 million is … an earmark.

– B) Add-ons. The President budgeted $0 for a project and Congress added funds, even if there were no written directions within the Act language, Conference report, House report, or Senate report, the added amount IS an earmark.

– C) Carve-outs. The Administration asks for $100 million and Congress provides $100 million but places restrictions on some portion of the funding, the restricted portion is counted as an earmark. [Of the $1.5 bil appropriated, $30 mil is for Project XXX…]


FY05 E&WD ACT CW EARMARKS% Earmarked $$ by Account

FY05 E&WD ACT CW EARMARKS% Earmarked $$ by Account

6%8%

72%

12%2%

MR&T GI CG O&M FC&CE


Program ComparisonProgram Comparison

FY07 Bud FY07 WP FY08 Bud FY08 House FY08 Sen $ Millions

Investigations 94 163 90 120 172Operation & Maint. 2,258 1,975 2,471 2,655 2,292Construction 1,555 2,336 1,523 2,009 2,059Miss. River & Tribs. 278 397 260 278 375Regulatory Program 173 159 180 180 180F.C. & Coastal Emerg. 81 0 40 40 50F.U.S.R.A.P. 130 139 130 130 140Expenses 164 167 177 171 175ASA(CW) 5 4 0 6 5Total 4,738 5,340 4,871 5,589 5,448

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