Winter Leader Conference February 4, 2009 “ Building Strong “1 Budgets and Appropriations: Restoring our Infrastructure Budgets and Appropriations: Restoring our Infrastructure National Waterways Conference National Waterways Conference Gary A. Loew Headquarters, U.S. Army Corps of Engineers March 11, 2009 Gary A. Loew Headquarters, U.S. Army Corps of Engineers March 11, 2009 BUILDING STRONG

Winter Leader Conference February 4, 2009 “ Building Strong “2 Budgets and Appropriations ( $ Millions ) * No FY09 Energy & Water Development Appropriation has been passed. We are operating at FY08 levels under a Continuing Resolution Authority until Mar 09. FY08 Execution FY08 Budget FY08 Approp FY09 Budget FY09 Conference Investigations Construction 2,2211,5232,2941,4022,140 Operation & Maintenance 1,9712,4712,2442,4752,202 Mississippi River & Tributaries Regulatory Flood & Coastal Emergencies F.U.S.R.A.P Expenses ASA(CW) Sub - Total 6,1554,8715,5924,7415,401 Supplemental Approps 3,383 5,761 Stimulus Bill 4,600 Total6,1558,2548,97510,50215,694

Winter Leader Conference February 4, 2009 “ Building Strong “3 Civil Works Business Programs in FY2009 Budget & Supplemental Environmental Protection & Restoration Flood & Coastal Storm Damage Reduction Hydropower Recreation Navigation Water Supply Regulatory Support for Others Emergency Management Figures from FY09 Budget + Supplemental. Total = $9.475 M (includes $183 M Management & Oversight not listed in pictures) $1,892 M ** Estimated reimbursement from supported agencies, not in budget $7,083 M$511 M $319 M $58 M $270 M $2,400 M** $6 M $180 M

Winter Leader Conference February 4, 2009 “ Building Strong “4 Civil Works Program Trends FY06 – 13

Winter Leader Conference February 4, 2009 “ Building Strong “5 FY Budgets and Appropriations 1 Oct Mar 09–FY09 Continuing Resolution Act (CRA) 17 Feb 09 – ‘American Recovery and Reinvestment Act’ -- PL (ARRA) 24 Feb 09 – FY09 Omnibus Appns Conference Rpt Filed 26 Feb 09 – President presents FY10 Budget Overview ~11 Mar 09? – FY09 Appropriations Act 11 Mar 09 – FY11 Budget Guidance to field offices ~16 Mar 09 – ARRA funds issued to field offices Mar 09 – FY09 Appns Act funds issued to field offices ~24 Apr 09 – FY10 Budget details released to public ~Apr 09 – House T&I ARRA Oversight Hearing 30 Apr 09 – House FY10 Budget Hearing Early-mid 2010 – Another Stimulus Bill?

Winter Leader Conference February 4, 2009 “ Building Strong “6 FY2009 Appropriations ---Some Provisions--- CRA and FY09 Appropriations exempt inland waterway Rehabilitation (not new construction) projects from Inland Waterways Trust Fund cost sharing for FY 2009 Executive Order (E.O.) instructs agencies to ignore Report directions. Current version of Bill incorporates Conference Report text and tables into law by reference to counteract E.O. except for Section 1, Reprogramming instructions. New Administration position on E.O. unknown

Winter Leader Conference February 4, 2009 “ Building Strong “7 Economic Stimulus American Recovery and Reinvestment Act $4.6 billion for Corp programs ARRA funds are not to be cost shared with Inland Waterways Trust Fund No cost-share exemption from the HMTF or cost-shared projects Significant “transparency” requirements for tracking, monitoring and reporting of specific metrics Final selection of projects scheduled for approval in mid Mar 09 with work allowances to Districts immediately following selection. All unobligated funds (except for E&D, S&A and claims) expire 30 Sep 2010.

Winter Leader Conference February 4, 2009 “ Building Strong “8 ARRA Appropriations APPROPRIATIONS by ACCOUNT ($Billions) Investigations$0.025 Construction$2.000 O&M$2.075 MR&T$0.375 Regulatory$0.025 FUSRAP$0.100 TOTAL$4.600

Winter Leader Conference February 4, 2009 “ Building Strong “9 Other ARRA Provisions Projects are eligible only if funded “heretofore or hereafter” [i.e. no new starts] Relief from cost sharing with IWTF Unlimited reprogramming authority (?) Up to 0.5% to administer the Act (Mgmt & Oversight) NLT $200M for Environmental Infrastructure Section 902 relief Ceiling relief for Section 14, 205, 206 and 1135 Programs Funds may be retained after 30 Sep 2010 expiration for E&D, S&A, Claims WRDA Sec 9006 relief (levee surveys )

Winter Leader Conference February 4, 2009 “ Building Strong “10 Stimulus-Project Selection Criteria Project selection criteria in Conference Report are projects, programs or activities that will: be obligated/executed quickly; result in high, immediate employment; have little schedule risk; be executed by contract or direct hire of temporary labor; and complete either a project phase, a project, an element, or will provide a useful service that does not require additional funding.

Winter Leader Conference February 4, 2009 “ Building Strong “11 Stimulus-Project Selection Criteria - II CriteriaImplementation Obligate/execute quickly; High, immediate employment Sort by award date. For same date, sort by completion date Little schedule riskDistricts filter out all projects with schedule risk Complete project phase, project, or element, or will provide a useful service that does not require additional funding Districts prepare work packages accordingly Execute by contract or direct hire of temporary labor No in-house labor except for OH/E&D/S&A No reimbursements No land purchase

Winter Leader Conference February 4, 2009 “ Building Strong “12 Stimulus-Project Selection Criteria III In addition, some CW Program Goals Reasonable distribution across programs, e.g. flood risk management, coastal and inland navigation,, environmental restoration, hydropower, recreation Reasonable geographic distribution These goals were applied in select cases: –IWTF project funding set at a reasonable appropriation level FY /4 = $368/ IWTF Stimulus projects = $358 M) –Environmental Infrastructure = $201M, consistent with legal minimum –CAP requests totaled $60 M; all were included; –Element size was capped at $50 M to enable geographic and business line balance

Winter Leader Conference February 4, 2009 “ Building Strong “13 Stimulus Projects Submitted Civil Works Data Base of Eligible Projects that could be Executed by 30 Sep 2010 AccountNumber of Work Packages Amount (Millions) Construction3,600$7,700 Opns & Maint6,600$7,000 MR & T 700$ 700 Total10,900$15,400

Winter Leader Conference February 4, 2009 “ Building Strong “14 Projects Selected - PREDECISIONAL AccountWork Packages Projects Amount Construction - IN ($2 billion) 272 packages 250 projects $25 K - $49 M $25 K - $90 M Construction – OUT 468 packages 117 projects $2 K - $355 M $2 K - $1.2 B O&M - IN ($2.075 billion) 2,164 packages 516 projects $1 K - $36 M $23 K - $85 M* O&M – OUT3,418 packages 655 projects $1 K - $43 M $12 K - $147 M Investigations - IN 69 projects $20 K - $2 M Investigations – OUT 420 projects $1 K - $4 M MR&T – IN ($375 M)247 packages 39 projects $25 K - $24 M $231 K - $41 M

Winter Leader Conference February 4, 2009 “ Building Strong “15 Benefits-Jobs Created Jobs created by USACE portion of stimulus estimated at 139,000. –Direct creation of ~37,000 new private sector jobs with average annual wages between $38,000 and $42,500 –Additional 102,000 new jobs in industries supplying construction and O&M activities and sell goods and services to new workers and their families.

Winter Leader Conference February 4, 2009 “ Building Strong “16 FY2010 Budget - Status President will delivered the FY10 Budget Overview to Congress on Feb 27th. It is a high level document (with no accompanying agency detailed project information) OMB has provided the Corps a FY10 Budget ceiling ASA/Corps staff are working with OMB on the final criteria, program amounts and project details. Target is to release FY10 Budget detailed information in mid-late April

Winter Leader Conference February 4, 2009 “ Building Strong “17 And for the Out Years … FY 2011 Budget Guidance to divisions and districts to be sent on Mar 11 th Expect a major debate on Federal funding priorities to commence with the FY 11 budget We will continue to place a high priority on accurate ‘capability’ estimates from We will continue to place a high priority on execution of all that is appropriated We will seek to improve our budget ‘defense’ of the value to the nation of the water resources infrastructure for which we are responsible

Winter Leader Conference February 4, 2009 “ Building Strong “18 Trends To Watch Continuing Pressure on Budget Entitlement Programs ( Medicare, Medicaid, Social Security) Interest on the National Debt Status of US & World Economies Cost of Infrastructure Recapitalization Improved Inspection Techniques Modern Design Standards Cost of meeting ESA and other legal requirements

Winter Leader Conference February 4, 2009 “ Building Strong “19 National Economic Efficiency?National Economic Efficiency? Environmental Sustainability?Environmental Sustainability? Security?Security? Quality of Life?Quality of Life? All of the Above?All of the Above? None of the AboveNone of the Above Other????Other???? Making the Case for Infrastructure What is the Message?

Winter Leader Conference February 4, 2009 “ Building Strong “20 BUILDING STRONG