Waters and Wetlands:

Corps of Engineers Needs to Ensure That Permit Decisions Made Using Funds from Nonfederal Public Entities Are Transparent and Impartial

GAO-07-478: Published: May 16, 2007. Publicly Released: Jun 8, 2007.

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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.

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.

Status Legend:

More Info
  • Review Pending-GAO has not yet assessed implementation status.
  • Open-Actions to satisfy the intent of the recommendation have not been taken or are being planned, or actions that partially satisfy the intent of the recommendation have been taken.
  • Closed-implemented-Actions that satisfy the intent of the recommendation have been taken.
  • Closed-not implemented-While the intent of the recommendation has not been satisfied, time or circumstances have rendered the recommendation invalid.
    • Review Pending
    • Open
    • Closed - implemented
    • Closed - not implemented

    Recommendations for Executive Action

    Recommendation: To ensure that the permits processed under the section 214 authority comply with federal regulations and guidance, the Secretary of the Army should direct the Corps of Engineers to provide training to district officials to ensure that they are aware of the requirements that apply to permits processed under the section 214 authority.

    Agency Affected: Department of Defense: Department of the Army

    Status: Closed - Implemented

    Comments: The Corps held training sessions in August 2007 and May 2008 at national conferences attended by all regulatory staff, during which the following topics relating to the section 214 permitting authority were discussed and clarified: the revised guidance in draft form, expectations regarding impartial decision making and disclosure of decisions to the public, and the annual reporting process. Furthermore, discussion of the WRDA section 214 program was also included in the curriculum for a development course to help train new regulatory chiefs. As part of its dissemination efforts for the revised guidance, the Corps also sent a memo to regulatory chiefs across all Corps districts and divisions highlighting sections of the guidance where clarifications were made that could impact the districts' implementation of the section 214 authority. Among the items highlighted were the increased annual reporting requirements designed to improve the Corps' ability to assess the program's impacts.

    Recommendation: To ensure that the permits processed under the section 214 authority comply with federal regulations and guidance, the Secretary of the Army should direct the Corps of Engineers to clarify the documentation that district officials must include in project files to justify and support their decisions.

    Agency Affected: Department of Defense: Department of the Army

    Status: Closed - Implemented

    Comments: We believe the Corps has taken appropriate steps to ensure that the documentation that district officials include in project files will justify and support their permitting decisions. Specifically, the Corps has completed a checklist, or template, of the decision documents necessary to support its general, or nationwide, permitting process. In addition, the Corps completed a template for its standard permits decision-making process that includes additional elements necessary to document compliance with the National Environmental Policy Act and other relevant statutes and regulations. As part of its efforts to develop these decision document templates, the Corps completed an analysis of all nationwide permitting processes in December 2008 and incorporated the results of this analysis into these templates to help ensure consistent and complete support documentation.

    Recommendation: To ensure that the permits processed under the section 214 authority comply with federal regulations and guidance, the Secretary of the Army should direct the Corps of Engineers to clarify the guidance that the districts must follow when evaluating permit applications under the section 214 authority.

    Agency Affected: Department of Defense: Department of the Army

    Status: Closed - Implemented

    Comments: The Corps issued revised guidance on October 1, 2008, that improves on the prior guidance and addresses a number of points we raised in our May 2007 report. Specifically, the revised guidance includes a list of acceptable activities for which section 214 funds can be used and more explicitly describes the circumstances under which funds can be accepted. In addition, the section of the revised guidance related to accountability has been revised, and additional items that need to be tracked and reported to the Corps headquarters on an annual basis are now delineated. These items include performance metrics and a statement certifying that all project managers are aware of and trained on the requirements contained in the guidance. Furthermore, the Corps also significantly expanded upon the requirements in the guidance related to impartial decision making. Specifically, under the revised guidance, participating Corps districts are to ensure that all documents involved in the decision-making process are reviewed and approved by someone at least one level higher than the program manager who is funded by the authority. In addition, the guidance now requires that all final permit decisions need to be updated monthly on the district's Web page in an area separate from any other final actions and that the decision be clearly identifiable as being for projects funded through the WRDA section 214 authority.

    Recommendation: To ensure that the permits processed under the section 214 authority comply with federal regulations and guidance, the Secretary of the Army should direct the Corps of Engineers to 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.

    Agency Affected: Department of Defense: Department of the Army

    Status: Closed - Implemented

    Comments: In our 2010 review of the Corps' efforts to implement our recommendation, we found that the Corps had taken some positive steps to address our concerns regarding oversight of Water Resources Development Act section 214 authority, but that the Corps' actions had fallen short in two significant areas: (1) ensuring the quality and thoroughness of the annual reports and (2) improving the transparency of decision making to the public by clearly posting public notices of funding decisions on the district Web sites. Our 2011 review of these two items indicates that the Corps has addressed our concerns and has made significant progress in these two areas. First, the Corps issued a memorandum detailing annual reporting expectations, as well as a template for the annual reports to follow to make it easier to monitor that key aspects of the section 214 authority. Second, the Corps finalized and issued a new decision document template that addresses prior concerns with lack of standardization in decision making. Third, the Corps standardized training materials to ensure that all staff were adequately and consistently being trained on the requirements associated with section 214 authority. Finally, our review of annual reports for FY2010 indicates that almost all of the 19 Corps Districts that have entered into section 214 agreements had fully complied with the annual reporting guidance and template; any deviations were minor in nature. In addition, nearly all of these District's Web sites clearly identify where information on and decisions regarding section 214 authority can be found.

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