The amount and type of information the Corps requests from  the applicant may vary by the type of applicant and project, as well as the  extent and functional values of the water resources that may be impacted. In 2000, the Congress included a provision  in the Water Resources and Development Act to expedite permit  processing for nonfederal public agencies. However, two  applicants were private companies that were allowed to submit permit  applications for expedited review under a nonfederal public entity’s  agreement with the Corps. An additional 19 districts told us that they would  consider using the authority if it were made permanent. Although the agreements are  generally between the Corps and one entity, such as a city or county,  various departments within that entity may submit permit applications for  expedited review under the agreements. Using the funds received under the section 214 authority, the four districts  evaluated and approved 187 permit applications, as of August 2006. Most of the permit applications were from city or  county departments, port authorities, or regional water authorities. The legislation does not expressly prohibit the  practice of allowing private companies from requesting permit approval  under a nonfederal public entity’s section 214 agreement with the Corps. Corps Districts Received More Than $2 Million in Section 214 Funds That Were Used to Primarily Cover Personnel- Related Costs

From December 2001 through September 2006, nonfederal public entities  provided over $2 million in section 214 funds to the four Corps districts  with whom they had section 214 agreements. Each of the four Corps districts that received section 214 funds was able  to increase its regulatory staff by either (1) combining the section 214  funds with appropriated funds to hire new project managers to process  section 214 applications or (2) paying existing employees to process  section 214 applications and using the offsets in regular program  expenditures to hire new project managers to process non-section 214  applications. Processing Times Have Both Increased and Decreased Since the Use of the Section 214 Authority Began

Although a main goal of the Corps in using the section 214 authority is to  expedite permit processing for section 214 applicants, the processing  times for these applicants have not consistently decreased. We believe that several factors may have influenced the permit processing  times and masked the effect, if any, that the use of the section 214  authority had on them. Officials Cited Other Benefits of Using the Section 214 Authority

Officials from the Corps and from nonfederal public entities that entered  into section 214 agreements with the Corps told us that they believe the  use of the section 214 authority has significantly expedited processing of  permits for these applicants. As a result, for the projects for which it approved  standard permits, the Sacramento District did not show that the adverse  effects of the projects were outweighed by the positive impacts of the  projects and did not conclude that the projects were in the public interest. Corps officials  cited several reasons for the variance in their adherence to the additional  requirements. Recommendations for Executive Action

To ensure that the permits processed under the section 214 authority  comply with federal regulations and guidance, we are recommending that  the Secretary of the Army direct the Corps of Engineers to take the  following four actions:    clarify the guidance that the districts must follow when evaluating permit  applications under the section 214 authority,   clarify the documentation that district officials must include in project  files to justify and support their decisions,   provide training to district officials to ensure that they are aware of the  requirements that apply to permits processed under the section 214  authority, and   develop an effective oversight approach that will ensure that the districts  are following all the appropriate requirements when evaluating projects  under the section 214 authority. In this context, we were asked to review the (1) extent to which  Corps districts have entered into agreements with nonfederal public  entities to receive section 214 funds since 2001 and how many permit  applications the Corps has evaluated using these funds, (2) amount of  section 214 funds the Corps has received and how it has used these funds,  (3) extent to which permit processing times have changed since the Corps  began using section 214 funds, (4) extent to which the Corps districts have  followed the basic permit review processes when evaluating applications  using section 214 funds, and (5) extent to which the districts have met the  additional requirements for ensuring that permit decisions made using the  section 214 funds are impartial and transparent. To determine the extent to which the Corps followed the existing permit  review processes, we first identified key steps for processing permits.
Why GAO Did This Study

When a nonfederal public entity such as a city or county wants to build a public works project that could degrade or damage federally regulated waters and wetlands, it must obtain a permit from the U.S. Army Corps of Engineers (Corps) before proceeding. To help expedite the permit process for these entities, the Congress enacted section 214 of the Water Resources and Development Act of 2000, providing the Corps with temporary authority to receive funds from such entities and use the funds to process permits. To ensure the impartiality and transparency of section 214 permit decisions, the Corps requires its districts to adhere to all existing permit review processes, as well as some additional requirements. GAO was asked to identify (1) how many districts have used the section 214 authority, (2) the amount of funds they have received, (3) how permit processing times have changed, (4) the extent to which districts have adhered to the existing review processes and the additional requirements.

What GAO Found

As of August 2006, 4 of the Corps' 38 districts had agreements with 11 nonfederal public entities to receive section 214 funds, which have been used to evaluate permit applications. These districts received, evaluated, and approved 187 applications using section 214 funds. The types of projects for which permits were requested included ecological restoration, water storage, transportation, and port construction. Most of the section 214 applicants were city or county departments, port authorities, or regional water authorities, but two applicants were private companies that were allowed to submit applications under section 214 agreements with the Corps. The legislation does not expressly prohibit private companies from submitting applications under section 214 agreements. The use of the section 214 authority may become more prevalent in the future because 7 additional districts are in the process of entering into such agreements, and 19 other districts told GAO that they would consider using the authority if the Congress makes it permanent. The Corps received more than $2 million in section 214 funds from nonfederal public entities between December 2001 and September 2006 and used these funds primarily to hire additional project managers to process permits. About 61 percent of the funds were used to cover personnel costs for the project managers who processed section 214 permits; the remainder covered overhead and other costs incurred to implement the authority. Since the Corps began using the section 214 authority, permit processing times have increased in some districts and decreased in others for both section 214 applicants and non-section 214 applicants. However, it is difficult to attribute the changes in processing time directly to the use of the section 214 authority because many other factors may have influenced processing times and may have masked the effects of the authority. For example, the complexity of 214 permit applications may have resulted in greater processing time for these applicants. Generally, Corps officials and nonfederal public entities who used the authority believe that it has expedited permit processing, saved them cost and time, and improved communication between the Corps and the section 214 applicants. The four districts varied in the extent to which they adhered to the existing permit review process and the additional requirements to ensure impartiality of section 214 permit decisions. For example, one district did not follow a key step in reviewing certain types of section 214 permits because officials did not know they were required to do so. In two other districts, lack of documentation in the permit files prevented GAO from determining whether they followed the existing review processes for another type of permit. With regard to the additional requirements imposed by the Corps for section 214 permits, some districts did not comply with these requirements because they were not aware of them, and others did not comply with them because they interpreted the requirements differently than Corps headquarters intended.