U.S. Army Corps of Engineers: Annual Appropriations Process and Issues for Congress
Released: 2020-04-21T00:00:00

Introduction

The U.S. Army Corps of Engineers (USACE) is an agency within the Department of Defense with both military and civil works responsibilities. Congress directs USACE's civil works activities through authorization legislation, annual and supplemental appropriations, and oversight activities. This report summarizes USACE's annual discretionary appropriations for civil works activities, which typically are funded through Title I of annual Energy and Water Development appropriations acts. First, the report introduces USACE and its funding. Second, it summarizes the appropriations process through discussions of three major milestones: President's budget request, congressional appropriations process, and annual USACE work plan. Third, the report provides a brief discussion of trends and policy questions related to USACE annual appropriations.

USACE Primer

A military Chief of Engineers commands USACE's civil and military operations. The Assistant Secretary of the Army for Civil Works (ASACW) provides civilian oversight of USACE. The agency's responsibilities are organized into eight geographically based divisions, which are further divided into 38 districts.

As part of USACE's civil works activities, Congress has authorized and appropriated funds for the agency to perform the following:

water resource projects for maintaining navigable channels and harbors, reducing risk of flood and storm damage, and restoring aquatic ecosystems, among other purposes; environmental infrastructure assistance; regulation of activities affecting certain waters and wetlands activities; and remediation of sites involved in the development of U.S. nuclear weapons from the 1940s through the 1960s, administered under the Formerly Utilized Sites Remedial Action Program (FUSRAP).

USACE Funding

From FY2010 to FY2020, Congress provided USACE with appropriations ranging from $4.72 billion in FY2013 to $7.65 billion in FY2020. Unlike federal funding for highways and municipal water infrastructure, the majority of federal funds provided to USACE are not distributed by formula to states or through competitive grant programs. Instead, USACE generally expends the appropriations on its congressionally authorized water resource projects. That is, the majority of USACE's appropriations are for the planning, construction, and operation of the agency's water resource projects, such as multipurpose dams and commercial navigation improvements along coasts and inland waterways.

Congress generally funds USACE civil works through Title I of annual Energy and Water Development appropriations acts. In addition to funding the agency's water resource activities, Congress provided $100 million for environmental infrastructure activities, $210 million for USACE regulatory activities, and $200 million for FUSRAP in FY2020.

Each year, some USACE projects receive construction funds; however, many authorized USACE construction projects have not been federally funded for years after their authorization. That is, Congress has authorized construction projects and rehabilitation and repair work that totals an estimated $96 billion: approximately $32 billion of authorized but unfunded projects and approximately $64 billion of rehabilitation and repair work (e.g., for dam safety). This is often referred to as the agency's construction backlog . The backlog includes much more authorized work than can be accomplished with annual construction appropriations, which has ranged from $2.1 billion to $2.7 billion annually during FY2018 through FY2020. A subset of the projects in the backlog are funded in a given year, and many projects in the backlog receive no funds for years.

Congress also has provided USACE with emergency supplemental appropriations in some years, typically in response to floods. Most of these supplemental funds are directed to repairing damage to existing USACE facilities, paying for flood fighting and repair of certain levees and dams maintained by nonfederal entities, and constructing new riverine and coastal flood control improvements. For more information on supplemental funds for USACE and associated congressional direction, see CRS In Focus IF11435, Supplemental Appropriations for Army Corps Flood Response and Recovery , by Nicole T. Carter and Anna E. Normand.

In addition to federal funding, most USACE activities require a nonfederal sponsor to share some portion of project costs. For some project types (e.g., levees), nonfederal sponsors are required to perform operation, maintenance, repairs, replacement, and rehabilitation of the works once construction is complete. For more information on nonfederal cost-share requirements, see CRS Report R45185, Army Corps of Engineers: Water Resource Authorization and Project Delivery Processes , by Nicole T. Carter and Anna E. Normand.

Annual Appropriations Process

The annual appropriations process generally involves three major milestones: President's budget request, congressional deliberation and enactment of appropriations, and Administration development of a USACE work plan (see Figure 1 ). The process begins with the release of the President's budget request, typically in early February (i.e., roughly eight months before the start of the fiscal year addressed by the request), although it is sometimes delayed. Congress may consider the President's budget request, stakeholder interests, and other factors when creating an annual Energy and Water Development appropriations bill that includes USACE civil works activities. The length of the congressional appropriations process varies from year to year, as shown in Figure 1 . Following enactment of the Energy and Water Development bill, the Administration develops a USACE work plan, which identifies the amount of additional funding provided to specific studies and projects. The following sections describe these major milestones in more detail.

President's Budget Request

The President's budget request for USACE typically is for funding at the account level (i.e., Investigation, Construction, and Operation and Maintenance), as shown in the appendix to the President's FY2020 budget request. The agency's budget justification includes more detailed information regarding the request by providing information for specific activities, such as the level of funding requested for particular USACE studies and construction projects. USACE also publishes a summary of this information in a document it refers to as the p ress b ook . The press book shows the requested funding for USACE projects for each state and identifies how the President's requests for various accounts are distributed across the agency's business line s (i.e., types of activities, such as navigation, restoration, and recreation) in a crosswalk (see Appendix A ).

In recent years, the executive branch has used various metrics, including benefit-cost ratios and other performance criteria, to identify which projects and activities to include in the President's request. For example, to identify operation and maintenance investments, the Administration's budget development guidance has used risk assessments, which consist of an evaluation of an existing project's condition and the consequences of reduced project performance (i.e., the consequence of not making an investment). USACE budget development guidance describes these metrics and other aspects of the budget development process each year. Recent Administrations also have limited funding for new starts to focus on completing existing projects and on actions to address aging infrastructure.

Congressional Appropriation Acts

As shown in Figure 2 , since FY2006, Congress has appropriated more for USACE civil works than the President requested in all but one year. In the text of enacted appropriations laws, Congress generally provides appropriations to USACE at the account level (see Table 1 for a description of the accounts and their FY2018 to FY2020 appropriations amounts). Accompanying appropriations reports (i.e., conference reports, committee reports, or explanatory statements), which sometimes are incorporated into law by reference, often identify specific USACE projects and programs to receive appropriated funds.

In addition to regular appropriations, Congress provided USACE with various emergency supplemental appropriations from FY2006 to FY2019. For example, Congress provided a total of more than $47 billion for flood fighting (e.g., construction of temporary levees) and flood recovery (e.g., construction of flood risk reduction in states and territories affected by flooding) over those years, as well as $4.6 billion for economic recovery as part of the American Recovery and Reinvestment Act of 2009 ( P.L. 111-5 ). These supplemental appropriations are not shown in Figure 2 .

Generally, Congress provides the majority of USACE's funding to two accountsâthe Construction account and the Operation and Maintenance (O&M) account. The O&M account has made up a growing portion of the agency's use of annual appropriations, as shown in Figure 3 . Between FY2006 and FY2020, the O&M account increased from 37% of USACE annual appropriations in FY2006 and FY2007 to a high of 53% in FY2018 and FY2019.

Additional Funding

For decades, Congress provided funding to USACE projects that were not included in the President's request until the House and Senate earmark moratoriums limited Congress's ability to select which site-specific projects would receive funding. Since the 112 th Congress, in lieu of increasing funding for specific projects, Congress has provided additional funding for specified categories of work within some USACE budget accounts. That is, in recent appropriations cycles, Congress has included additional funding categories for various types of USACE projects (e.g., additional funding for inland navigation), along with directions and limitations on the use of these funds on authorized studies and projects. Recent levels of additional funding are shown in Figure 4 . For example, Congress provided $2.69 billion more in P.L. 116-94 than the President's request for FY2020. Of this $2.69 billion, $2.53 billion was identified as additional funding for 26 categories of USACE activities in four budget accounts (see Appendix B ). In Figure 4 , categories are aggregated into navigation activities, flood risk reduction activities, and other authorized project purposes (e.g., environmental restoration). Since FY2014, Congress also has specified in each appropriations bill the number and types of studies and projects to be selected to receive funding for the first time (referred to as new starts ). For example, Congress directed USACE to use FY2020-enacted funding to initiate a maximum of six new studies and six new construction projects.

Agency Work Plan

Since FY2012, Congress has directed USACE to produce an annual work plan describing how funds will be allocated at the project level. For example, in FY2020, the explanatory statement accompanying the Further Consolidated Appropriations Act, 2020 ( P.L. 116-94 ), called for USACE, within 60 days after enactment of the appropriations bill, to issue a work plan that includes the specific amount of additional funding to be allocated to each project. The Administration develops the work plan, which typically consists of tables that list the projects, the amount of additional funding that each project is to receive, and a one- or two-sentence description of what USACE is to accomplish with the funds for the project. For projects not in the budget justifications that accompanied the President's budget request, the information included in the work plan may be the extent of the Administration's public explanation of the project-level work to be accomplished during the fiscal year.

During the FY2014 to FY2019 period, investments in some USACE business lines increased and investments in other business lines decreased. As shown in Figure 5 , Congress provided year-to-year increases in funding for navigation, which exceeded annual navigation spending in the FY2006 to FY2013 period. In contrast, annual funding for the environment (i.e., environmental restoration and environmental stewardship business lines) was less from FY2014 to FY2019 (ranging from $470 million to $591 million annually) compared with funding in the earlier FY2006 to FY2012 period, which ranged from $609 million to $680 million annually.

Funding for flood risk reduction has remained around 30% of the total annual appropriations for most of the years in the FY2006 to FY2019 period shown in Figure 5 . The majority of the annual flood-related funds shown in Figure 5 are for riverine flood risk reduction activities. For example, of the construction funds for flood risk reduction provided in annual appropriations acts for FY2017, FY2018, and FY2019, funding for coastal storm damage reduction represented 11%, 9%, and 7%, respectively. The explanatory statement accompanying the FY2020 appropriations act ( P.L. 116-94 ) includes the following statement: "Within the flood and storm damage reduction mission, the Corps is urged to strive for an appropriate balance between inland and coastal projects."

Of the previously mentioned $47 billion in flood-related supplemental appropriations from FY2006 to FY2019, Congress provided around $24 billion for construction of flood risk reduction projects. Congress provided almost $15 billion of the $47 billion to the Flood Control and Coastal Emergencies (FCCE) account for flood fighting and repair of certain nonfederal flood risk reduction projects during the FY2006 to FY2019 period. In contrast, annual appropriations for FCCE generally have been less than $35 million and used for emergency response training and preparedness ( Table 1 ).

Trends and Policy Questions

Congress may consider the following trends and policy questions when determining future appropriations and funding allocation language directed to USACE.

Shift to Administration -Developed Work Plans

Since earmark moratorium policies were introduced in the 112 th Congress, Congress has provided annual appropriations above the President's request to fund various additional categories of work (see Figure 4 for funding levels from FY2012 to FY2020). The Administration follows congressional guidance regarding priorities, new starts, and other matters, in part, to develop post-enactment agency work plans that specify which projects are to receive the additional funding. Unlike the justification documents that accompany the President's budget request, the Administration limits the project-level details in the work plan to a few sentences per project. Potential policy questions related to the shift to Administration-developed work plans include the following:

What is the effect on congressional oversight when the USACE work plan provides fewer project-level details than the budget request? As Congress debates the limits on congressionally directed spending (or earmarks), will considerations include the type of direction Congress can provide USACE on the use of additional funding? How might Congress address differences between its priorities and the Administration's priorities for USACE in future fiscal years' appropriations?

Construction Backlog

According to USACE, in early FY2020, there was a construction backlog of $96 billion, including projects with signed Chief's reports (i.e., reports recommending new projects for congressional construction authorization), dam modifications, and deferred maintenance. At the FY2021 budget release press conference, the Chief of Engineers stated that since the enactment of the last Water Resources Development Act (Title I of America's Water Infrastructure Act of 2018; P.L. 115-270 ), he had signed 19 Chief's reports, representing over $9 billion in proposed construction; he also said he anticipated signing another 19 Chief's reports by the end of CY2020. If Congress authorizes these projects, the construction backlog would likely continue to increase more quickly than construction would progress using available USACE appropriations. For example, Congress appropriated $2.2 billion in FY2019 and $2.7 billion in FY2020 for the Construction account and required five new construction starts in FY2019 and six new construction starts in FY2020. Potential policy questions related to the construction backlog include the following:

How might Congress address the national demand for water resource infrastructure projects, in part illustrated by the USACE construction backlog? How might Congress address stakeholder interest in new starts and identify a path to construction for authorized but unfunded USACE projects?

Shift to Operation and Maintenance

U.S. water infrastructure is aging; the majority of the nation's dams, locks, and levees are more than 50 years old. An increasing share of USACE's annual discretionary appropriations goes to O&M activities, including activities to maintain USACE-constructed water infrastructure (see Table 1 for description of activities funded by the O&M account). The O&M account increased from 37% of USACE annual appropriations in FY2006 and FY2007 to a high of 53% in FY2018 and FY2019. The following is a potential policy question related to the shift toward more annual appropriations being used to for O&M:

How might Congress address the funding of aging USACE infrastructure, while also meeting the other demands for agency projects and funds?

Navigation

As discussed in the box titled "Navigation Trust Funds," in P.L. 116-136 , Congress altered how some Harbor Maintenance Trust Fund spending is accounted for in relation to budget caps. Congress, as recently as for FY2020 appropriations in P.L. 116-94 , has reduced the funds to be derived from the Inland Waterways Trust Fund for some projects to allow more inland waterway construction projects to proceed. The Administration has proposed identifying additional ways for waterway interests to contribute to the costs of inland waterway construction and O&M. Potential policy questions related to funding navigation actives include the following:

How might Congress address the interest of the inland waterways industry and its stakeholders in spending on waterway construction that exceeds the Inland Waterways Trust Fund's ability to cover 50% of the construction costs? Will the anticipated changes to Harbor Maintenance Trust Fund accounting toward budget caps and allocations result in congressional adjustments to the annual appropriations levels for USACE or other federal agencies' appropriations?

Flood Risk Reduction

Congress has directed around 30% of USACE's annual appropriations to support flood risk reduction activities, with around 90% of these funds, in most years, supporting riverine flood risk reduction. In addition, as previously noted, the FCCE account typically receives annual appropriations around $35 million, and its flood response and repair activities are primarily funded through supplemental appropriations. Potential policy questions related to funding flood risk reduction actives include the following:

Will Congress or the Administration address the balance between inland and coastal projects referenced in the explanatory statement accompanying USACE's FY2020 appropriations in P.L. 116-94 ? What are the consequences of primarily using supplemental appropriations to fund FCCE activities, including repair of damaged nonfederal levees?

Environment

As previously noted, appropriations for USACE's environmental activities in recent years have been less than in the late 2000s. Annual funding for the environment was less from FY2014 to FY2019 (ranging from $470 million to $591 million) compared with funding in the earlier FY2006 to FY2012 period, which ranged from $609 million to $680 million annually. Postponed investments in aquatic ecosystem restoration may result in missed opportunities to attenuate wetlands loss and realize related ecosystem benefits. Potential policy questions related to the funding of USACE environmental actives include the following:

What are the consequences of the current level and distribution of USACE restoration funding?

Appendix A. USACE Business Line/Account Crosswalk

Congress appropriates funding to the U.S. Army Corps of Engineers (USACE) for its civil works activities at the account level (e.g., Investigation, Construction, and Operation and Maintenance [O&M]). Table 1 provides a description of each account. Activities funded in these accounts are categorized by business lines based on the type of activities. Whereas some business line activities (e.g., navigation, flood damage reduction, restoration, recreation) are spread across accounts (e.g., Investigations, Construction, O&M), other business line activities are exclusive to one account with the same name (e.g., Formerly Utilized Sites Remedial Action Program, regulatory, expenses). Along with the President's budget request, USACE publishes a press book that identifies in a crosswalk how the President's requests for various accounts are distributed across the agency's business lines. For example, Figure A-1 shows the crosswalk for the FY2018 President's budget request for USACE; the columns are the accounts, and the rows are the business lines. Following enactment of appropriations and work plan development, USACE typically also calculates the level of funding for each business line.

Appendix B. Additional Funding Categories and Amounts

Since the 112 th Congress, Congress has provided additional funding for specific categories of work within some USACE budget accounts (e.g., Investigations, Construction, O&M, Mississippi River and Tributaries). Table B-1 shows the additional funding Congress provided in FY2018 to FY2020 for 26 categories of USACE activities across four budget accounts. Congress directed USACE to produce a work plan no later than 60 days after enactment of the appropriations bill, allocating these additional funds to projects meeting the criteria of the categories and any other direction provided in the explanatory statement or conference report. Some states received funding for larger projects, whereas others received funding for less extensive work. For example, under the Construction account, the work plan allocated $100 million or more per state in additional funding to 10 statesâAlabama, California, Florida, Illinois, Louisiana, North Dakota, New Jersey, Pennsylvania, Tennessee, and Texasâin at least one of FY2018, FY2019, or FY2020; the work plans over that same period included between $1 million and $7 million annually per state for other states (e.g., Minnesota, Montana, New Mexico, Nevada, and Utah).