Process for Feasibility Studies and Construction Projects Led by Nonfederal Sponsors

Alternatively, when a nonfederal sponsor undertakes a feasibility study or  construction project, the sponsor typically manages and funds the total  cost of the feasibility study or construction project and may later seek  reimbursement or credit for the federal share of the work it conducts. Nonfederal Sponsors May Conduct Feasibility Studies and Construct Water Resources Projects under Various Statutory Authorities

The authorities that allow nonfederal sponsors to undertake feasibility  studies and construction projects have been included in various federal  statutes since 1968. The Number of Federal Water Resources Projects Undertaken by Nonfederal Sponsors and the Amounts Reimbursed to Them Cannot Be Reliably Determined

Corps headquarters could not provide the exact number of, or specific  information about, projects undertaken by nonfederal sponsors because it  has delegated the responsibility for overseeing such projects to the  districts. In addition, the information that Corps headquarters collected  from the districts on the number of such projects and reimbursements to  nonfederal sponsors did not match the information that districts provided  to us. For example, Corps districts  reported that from 1986 through 2014, 28 nonfederal sponsors undertook  32 water resources projects: 11 feasibility studies and 21 construction  projects. However,  according to Corps headquarters data, the Corps reimbursed  nonfederal sponsors for the federal share of 20 projects. Corps headquarters officials stated they were not aware of Corps policies  or procedures that provide guidance to the districts on the type of  information to collect and maintain on projects led by nonfederal  sponsors, in general, including what information to record; how, when,  and where to record it; and how long to maintain it. Federal standards for  internal control call for internal controls and all transactions and other  significant events to be clearly documented in management directives,  administrative policies, or operating manuals and for accurate and timely  recording of transactions and events. Without developing documented  guidance for districts to have procedures for accurate recordkeeping for  transactions and other relevant information related to projects led by  nonfederal sponsors, the Corps does not have reasonable assurance that  districts will consistently record information on such projects and that the  information districts provide to headquarters on such projects will be  accurate and reliable. Corps District Officials and Nonfederal Sponsors Identified Partnerships and Communication As Areas That Worked Well on Projects Led by Nonfederal Sponsors

In discussing what worked well on projects led by nonfederal sponsors,  Corps district officials and nonfederal sponsors we interviewed identified  various factors. Eight of the 20 nonfederal  sponsors we interviewed said the Corps does not have clear guidance on  the project implementation process, which in some cases hindered the  nonfederal sponsors’ ability to efficiently implement projects. In February 2016, the Corps issued implementation guidance for  feasibility studies led by nonfederal sponsors under WRRDA 2014. In  this guidance, the Corps clarified that it is generally not authorized to  provide assistance to nonfederal sponsors undertaking feasibility studies,  except in certain circumstances in which the Corps is permitted to provide  limited technical assistance under the Intergovernmental Cooperation Act. However, the  number of federal water resources projects undertaken by nonfederal  sponsors and the amounts reimbursed to them cannot be reliably  determined because the Corps does not have guidance for districts— which are responsible for overseeing such projects—on how to collect,  record, and maintain accurate information about these projects. Recommendation for Executive Action

To ensure that the U.S. Army Corps of Engineers has accurate  information about federal water resources feasibility studies and  construction projects led by nonfederal sponsors, we recommend that the  Secretary of Defense direct the Secretary of the Army to direct the Chief  of Engineers and Commanding General of the U.S. Army Corps of  Engineers to establish documented guidance for accurate recording of  transactions and other relevant information related to these projects. Appendix I: Objectives, Scope and Methodology

This report examines (1) the authorities that enable nonfederal sponsors  to undertake a feasibility study or construct an authorized water resources  project, (2) the extent to which nonfederal sponsors have undertaken  federal water resources projects and the information the Corps has about  them, and (3) Corps officials’ and nonfederal sponsors’ views on the  lessons learned from these projects. We  administered the data collection instrument to all 38 Corps districts  responsible for civil works projects.
Why GAO Did This Study

Through its Civil Works program, the Corps designs, constructs, and maintains federal water resources projects, such as levees for flood risk management. Under certain authorities, nonfederal sponsors, such as states and local governments, may undertake studies or construct projects and may be eligible for reimbursement or credit for the federal share of costs.
GAO was asked to examine federal water resources projects undertaken by nonfederal sponsors. This report examines (1) the authorities enabling nonfederal sponsors to undertake studies or projects, (2) the extent to which such sponsors have undertaken federal projects and the information the Corps has about them, and (3) the Corps' and sponsors' views on lessons learned from projects. GAO reviewed federal laws and agency guidance; collected information about studies and projects led by nonfederal sponsors from 1986 through 2014 from all 38 Corps districts responsible for civil works; and interviewed Corps officials in 16 districts that have overseen at least one such study or project, as well as 20 nonfederal sponsors that have undertaken projects.

What GAO Found

Authorities that allow nonfederal sponsors to undertake federal water resources projects, including feasibility studies and construction projects, have been included in various federal statutes since 1968. Until June 2014, when Congress enacted the Water Resources Reform and Development Act, five federal statutory authorities allowed nonfederal sponsors to undertake studies or construction of federal water resources projects such as flood control projects. The 2014 act amended and consolidated prior statutory provisions authorizing water resources projects.
The number of federal water resources projects nonfederal sponsors have undertaken and the amounts they have been reimbursed for the federal share of these projects cannot be reliably determined. The U.S. Army Corps of Engineers (Corps) does not track this information at the headquarters level and has delegated the responsibility for tracking and overseeing such projects to the districts. While Corps headquarters collects information from the districts on reimbursements, the information that headquarters provided GAO did not match the information that the districts provided to GAO. For example, the number of reimbursed projects and the amount of reimbursements made to nonfederal sponsors were inconsistent in the two data sets. Corps headquarters officials could not fully explain why differences existed and could not identify any Corps policies or procedures that provide guidance to the districts on the type of information to collect and maintain on projects led by nonfederal sponsors. Federal standards for internal control call for all transactions and other significant events to be clearly documented, and for accurate and timely recording of transactions and events. Without documented guidance for districts regarding recordkeeping for projects led by nonfederal sponsors, the Corps does not have reasonable assurance that districts will consistently record information on such projects and that the information districts provide to headquarters on these projects will be accurate and reliable.
Corps district officials and nonfederal sponsors GAO interviewed identified several lessons learned from projects undertaken by nonfederal sponsors. For example, officials and nonfederal sponsors frequently cited enhanced partnerships and communication as areas that worked well on projects led by nonfederal sponsors. In contrast, both Corps district officials and nonfederal sponsors cited various challenges in existing Corps guidance. For example, officials noted that Corps guidance does not clearly establish roles and responsibilities for these projects, and nonfederal sponsors said the Corps does not have clear guidance on the project implementation process. The Corps issued implementation guidance for feasibility studies led by nonfederal sponsors in February 2016 in which it clarified that it is generally not authorized to provide assistance to nonfederal sponsors undertaking feasibility studies, except in certain circumstances in which the Corps is permitted to provide limited technical assistance to nonfederal sponsors. The Corps has also developed draft guidance for construction projects led by nonfederal sponsors, which it estimates it will issue later in 2016.

What GAO Recommends

GAO recommends that the Corps develop guidance for accurate recording of transactions and other relevant information about projects undertaken by nonfederal sponsors. The agency agreed with GAO's recommendation.