DEPARTMENT OF THE ARMY
OFFICE OF THE ASSISTANT SECRETARY OF THE ARMY (CIVIL WORKS)
STATEMENT OF MICHAEL L. DAVIS
DEPUTY ASSISTANT SECRETARY OF THE ARMY FOR CIVIL WORKS
BEFORE THE COMMITTEE ON ENVIRONMENT AND PUBLIC WORKS
ON S. 1222, THE ESTUARY HABITAT RESTORATION PARTNERSHIP BILL

INTRODUCTION

Mr. Chairman and members of the Committee, I am Michael L. Davis, Deputy Assistant Secretary of the Army for Civil Works. I am here today to present the Department of the Army's views on S. 1222, the Estuary Habitat Restoration Partnership Act.

ARMY CORPS OF ENGINEERS ENVIRONMENTAL MISSION

For over 200 years the nation has called upon the Army Corps of Engineers to solve many of its water resources problems. Historically, the Corps has emphasized its flood damage reduction and navigation missions. In recent years, however, pursuant to the Water Resources Development Act (WRDA) of 1986 and subsequent WRDAs, the Corps has elevated its environmental restoration and protection mission to a status equal to its flood damage reduction and navigation missions. The Corps now uses its engineering, project management, real estate, and environmental expertise to address environmental restoration and protection opportunities. The Corps environmental mission has been expanding over time with major changes in environmental law and policy, such as the National Environmental Policy Act of 1969, which requires each Federal agency to assess fully its actions affecting the environment, and the Federal Water Pollution Control Act of 1972 (commonly called the Clean Water Act) in which the Corps was given a major responsibility for regulating the discharge of dredged or fill material into all of our Nation's waters, including wetlands. Subsequent WRDAs have expanded further the environmental protection and restoration mission of the Corps of Engineers.

The Corps has a powerful toolkit of standing authorities and programs that can be brought to bear to help solve environmental problems. Over the last decade alone the Corps has helped to restore hundreds of thousands of acres of habitat of many types, and which benefit thousands of fish and wildlife species. Examples include: 28,000 acres of habitat restored for the Upper Mississippi River (98,000 projected by 2005); hundreds of acres of coastal wetlands restored in Louisiana; 35,000 acres of restored flood plain under construction for the Kissimmee River Restoration Project in the Florida; and, hundreds of acres of coastal wetlands restored under authorities which authorize the Corps to beneficially use dredged material for ecosystem restoration.

If enacted, S. 1222 would add to the Corps environmental portfolio. Specifically, S. 1222 would allow the Corps to use its unique skills to restore and protect estuary habitat and help achieve an economically and environmentally sustainable future for the nation and the world.

SIGNIFICANCE OF ESTUARINE AND COASTAL AREAS

Throughout the world, estuarine and coastal areas serve as focal points for human use and development. These same areas also perform critical functions from an ecosystem perspective, providing habitat and food for myriad fish and wildlife species. Estuaries are unique in that they serve as a transition zone between inland freshwater systems and uplands, and ocean marine systems. There is an urgent need to protect and restore these ecosystems recognizing the economic, social, and environmental benefits they provide. As with many environmental issues, future generations depend upon our actions today. In this regard, we applaud the co-sponsors of S. 1222 for their vision and leadership in this area.

S. 1222

The Department of the Army supports efforts to enhance coordination and efficiently finance environmental restoration and protection projects. The goal of restoring 1 million acres of estuary habitat by the year 2010 is in consonance with the President's Clean Water Action Plan and the goal of restoring 100,000 acres of wetlands, annually, beginning in the year 2005. We also agree with the philosophical basis for the legislation, that estuaries and coastal areas are being degraded rapidly, and that there is an urgent need to attain self-sustaining, ecologically-based systems that are integrated into surrounding landscapes. The proposed national framework, or national estuary habitat restoration strategy, to be completed at the end of the first year, should help partners identify and integrate existing restoration plans, integrate overlapping plans, and identify processes to develop new plans where they are needed. This framework document could help us maximize incentives for participation, leverage Federal resources, and minimize duplication of efforts. We support the requirement to publish the draft strategy in the Federal Register for review and comment to enhance public involvement. We believe that the legislation is consistent with the National Estuary Program (NEP) which was established to manage and protect aquatic ecosystems in coastal watersheds. The NEP strives to protect and restore habitat through consensus and initiatives which are community-based. The legislation also is consistent with the Coastal Wetlands Preservation Protection and Restoration Act (CWPPRA), or Breaux Bill, a unique multi-Federal and State agency partnership which is working to restore and protect approximately 73,000 acres of coastal wetlands in Louisiana over a 20 year period.

Thus, with a few important changes, the Department of the Army could support S. 1222. First, it is unclear which, if any, agency is to lead the Collaborative Council. This language implies a lead role for the Department of the Army and directs the Secretary to convene meetings. In addition, funds are authorized to be appropriated to the Department of the Army for administration and operation of the Collaborative Council. Funds also are authorized to be appropriated to the Department of the Army to implement estuary restoration and protection projects. While S. 1222 does not explicitly state the intent of Congress, the Department of the Army is prepared to take a leadership role if that is the desire of the Congress.

In order to maintain consistency and avoid confusion, I strongly recommend that the legislation be amended to 65 percent Federal cost sharing in accordance with WRDA 1986, as amended, especially since the bill states that estuary restoration projects could be implemented under section 206 of WRDA 1996 on Aquatic Ecosystem Restoration. As noted in the legislation, successful implementation of estuary habitat restoration projects will depend upon partnerships. At the heart of partnerships are the beneficiary pay reforms, especially cost sharing, which were first included in WRDA 1986, and expanded upon in subsequent WRDAs. These reforms allowed local sponsors the opportunity to be active participants in the water resources development process, thereby revitalizing the Army civil works program. Cost sharing serves as a market test of a project's merits, ensures active participation by project sponsors and beneficiaries, and ensures project cost effectiveness. We have found it to be an eminently successful policy. We are concerned that S. 1222 deviates from the basic cost sharing policies established in the WRDAs for environmental restoration projects, and that the variation in range of possible Federal cost shares, from 25 to 65 percent, could cause confusion amongst the public.

Section (d)(1) of S. 1222 states that the Collaborative Council shall not select an estuary habitat restoration project until each non-Federal interest has entered into a written cooperation agreement in accordance with section 221 of the Flood Control Act of 1970. This requirement was developed with flood damage reduction projects in mind, and provided the Federal government with some measure of certainty that non-Federal sponsors were fully recognized public bodies empowered to act on the behalf of constituencies, and to assume certain financial and legal obligations. Our experience is that while the need to meet section 221 requirements are still valid for most civil works projects, there are situations where these requirements eliminate very good potential non-Federal sponsors from consideration. For example, certain well-known and established environmental organizations could serve as sponsors for environmental restoration projects envisioned by this legislation. Environmental projects often differ significantly from flood damage reduction projects in that structural measures are kept to a minimum. These projects are formulated to simulate natural functions and values and often result in projects with minimal or no operations and maintenance requirements. Finally, many environmental restoration projects are located in areas where project operations pose no threat to human life or property. For all of these reasons, the Corps has put policies in place to enable consideration of non-governmental organizations for section 1135 projects (Project Modifications for Improvement of the Environment), and our WRDA 1998 proposal contains a provision that would amend section 206 of WRDA 1996, Aquatic Ecosystem Restoration, and a provision that would amend section 204 of WRDA 1992, Beneficial Use of Dredged Materials, to also allow the Corps to consider, where appropriate, non-governmental organizations (NGO) as sponsors for environmental restoration and protection projects. Because of the similarities between these environmental authorities, we recommend revising S. 1222 to allow NGOs to sponsor estuary habitat restoration projects. Further, we recommend that the Collaborative Council make recommendations to the Secretary of the Army on case-by-case bases.

Turning to the factors to be taken into account in establishing criteria for determining project eligibility, we recommend that the legislation require a consideration of the quality and quantity of habitat restored in relation to overall project cost. For environmental restoration projects implemented by the Corps, decision criteria of this kind tend to force a discipline to into the plan formulation and benefit analysis process that facilitates achieving optimal project designs. The criteria help benchmark performance reviews, and stand as a context for describing trade-off decisions. A requirement to address both quality and quantity of habitat restored would provide that information required to evaluate performance, at both the project and program levels, and facilitate production of bi-annual reports tied to the national estuary restoration strategy.

Many environmental restoration techniques and approaches are new, and when dealing with natural systems, there is a need to test new ideas, learn from successful projects and not so successful projects, and manage adaptively to adjust to ever-changing conditions. Adding a demonstration component with a cost share that is consistent with the rest of the program, and a requirement for non-Federal sponsors to manage adaptively, would encourage the partners to try out new ideas, and learn more about how to restore and protect estuary and coastal areas. Environmental restoration efforts for the Florida Everglades, the Upper Mississippi River System Environmental Management Program, and the Breaux Bill, all acknowledge, to varying degrees, the value of demonstration projects and adaptive management approaches.

The Army Civil Works program plays a critical role in providing and maintaining water resources infrastructure to meet future needs in consonance with other national priorities and a balanced budget. We try to avoid creating false hope by not authorizing projects that we cannot reasonably expect to fund or complete within a reasonable time frames. In light of the $20 billion backlog of ongoing Corps construction projects, and other authorized projects awaiting construction, the dollar magnitude for new projects and programs in the Administration's proposal for WRDA 1998 was constrained. Thus, while we could support being involved in a program to restore and protect estuaries and coastal areas, we are concerned that this new program could negatively impact other new and ongoing projects and programs which have been carefully prioritized and evaluated for phased implementation over a period of years. We are committed to a sustainable long-term construction program and more timely project delivery to non-Federal sponsors. The Administration's proposal for a new harbor services fee is one means to help address these funding constraints.

CONCLUSION

The Corps has been increasingly involved in recent years with efforts to protect and restore the benefits of estuaries and their surrounding habitat. We are especially proud of our efforts in conjunction with the Coastal America initiatives. Some examples of actions where the Corps, using its available programs, was in the lead for multi-agency, multi-level efforts (Federal, state, local and private) include restoration of a coastal salt marsh area in the Galilee Bird Sanctuary, Rhode Island; the initial demonstration area for restoration of tidal wetlands in the Sonoma Baylands, California; and, the Sagamore Salt Marsh Restoration, Massachusetts. Our FY 1999 budget request includes study funds for 10 potential projects directed at protecting or restoring the benefits of estuaries, as well as funding for many other activities that would be beneficial to the environment in or adjacent to our Nation's estuaries.

My staff and I have enjoyed working with you and your staff on S. 1222 and other legislation before your committee, including a 1998 WRDA. We look forward to continuing this relationship as work on this important legislation continues. The Department of the Army is looking forward to working with the Departments of Commerce, Agriculture, Interior, and Transportation, and the U.S. Environmental Protection Agency to restore and protect our nation's aquatic resources as outlined in the President's Clean Water Action Plan. Mr. Chairman, this concludes my testimony. I would be pleased to answer any questions you or the committee may have.