A little more than a year after the passage of the Water Resources Reform and Develop Act (WRRDA), the U.S. Army Corps of Engineers (USACE) has issued the draft guidance required by section 1018. And, from a local perspective, the draft guidance is quite good and appears to reflect a softening on some crediting issues that have plagued locally constructed projects for nearly five years.
If we climbed into the “wayback” machine we would find that over the past decades Congress has passed a number of provisions that allowed non-Federal sponsors to do work in advance of Federal planning or construction and then treat those costs as a credit toward the non-Federal sponsor’s cost share on the related Federal project. One of the most popular provisions for this was Section 104 of the Water Resources Development Act of 1986. Section 104 was highly liberal in its ability to lock in potential credit, with very few limitations. Unfortunately for aggressive non-Federal sponsors, the Office of the Assistant Secretary of the Army (ASA) became concerned that as non-Federal sponsors were able to “lock in credit” for planning or construction activities, each of those investments made it harder and harder for USACE to ultimately recommend a project which didn’t align perfectly with the already-constructed and locally-performed work. In other words, USACE awarding credit was actually driving USACE decisions to be made later. As a result, the ASA decided that credit could no longer be issued under Section 104, and instead should be evaluated under Section 221 of the Flood Control Act of 1970 (as that section was amended by section 2003 of WRDA 2007).