Final Version of First “Minibus” Appropriations Includes $7.0 Billion for Water Resources in FY19

September 13, 2018 (updated)

On September 10, Congressional negotiators released the final conference report version of the first three-bill “minibus” package of fiscal year 2019 appropriations bills, including the Energy and Water Development bill. The package appropriates $7.0 billion for the water resources program of the U.S. Army Corps of Engineers, $172 million more than last year and $72 million more than the Senate bill (but $279 million less than the House bill).

The Senate approved the conference report yesterday evening by a vote of 92 to 5 and then the House Rules Committee met shortly thereafter to issue a special rule waiving all points of order against the conference report. The House then agreed to the conference report this afternoon by a vote of 377 to 20, clearing it for the President’s signature. This puts the legislation well on track to be signed into law before the end of fiscal year 2018 on September 30, a partial return to the “regular order” of the good old days.

The legislative text of the package is here and the joint explanatory statement of the conferees (which includes funding totals for individual projects) is here. The Energy and Water Development portion is Division A of the package.

HMTF. The long-running dispute between appropriators and authorizers over the Harbor Maintenance Trust Fund (HTMF)  is not finally resolved, but the spending target for the HMTF under the 2014 water resources law for FY19 was $1.442 billion and the final bill provides $1.55 billion. HMTF funding is largely a subset of the overall Operation and Maintenance appropriation level (it depends on the blend of individual dredging projects funded and their depth, which determines the overall federal cost share). But this level does not begin to “spend down” the $9.1 billion HMTF balance that has been allowed to accumulate over the years, and estimated FY 2019 HMTF receipts are estimated by Treasury to be $1.85 billion ($1.735 billion in actual tax receipts and $113 million in interest on those large balances).

IWTF. The conference agreement does not state an amount for the Inland Waterways Trust Fund (IWTF) appropriation (tax receipts and interest for the IWTF are estimated to be about $104 million this year), but the conference agreement had this to say:

Recent statutory changes regarding the Inland Waterways Trust Fund (IWTF) have resulted in an increase to the size of the capital improvement program that can be supported by the IWTF. The agreement reflects congressional interest in supporting this larger program. The Corps is directed to take the preparatory steps necessary to ensure that new construction projects can be initiated as soon as can be supported under the larger capital program (i.e., as ongoing projects approach completion).

(Speaking of those future projects – the IWTF is currently being used to fund the Olmsted Locks and Dam project on the Ohio River. The water resources authorization bill introduced in the House on September 10 and already “pre-conferenced” between the House and Senate authorizes $471 million in future appropriations out of the IWTF – $379 million for one-half of the Chickamauga Lock replacement near Chattanooga and $92 million for one-half of the Three Rivers project in Southeast Arkansas. At the $113 million per year of new IWTF tax receipts and interest predicted by Treasury, these projects will take a while.)

Reorganization. The conferees firmly reject the element of the Trump Administration’s proposed government reorganization plan  that would move the navigation functions of the Corps of Engineers to the Department of Transportation. (Ed. Note: This is by no means a far-out idea and has been under serious discussion at high government levels, on and off, for decades – as ETW recently noted, this was first proposed by the Brookings Institution back in 1937.)

The conference agreement has this to say on the issue:

The conferees are opposed to the proposed reorganization as it could ultimately have detrimental impacts for implementation ofthe Civil Works program and for the numerous non-federal entities that rely on the Corps’ technical expertise, including in response to natural disasters.

The conferees are extremely concerned that an action of this magnitude, which crosses multiple jurisdictional lines and has far-reaching consequences, was not properly brought to Congress as a proposal, allowing for oversight and hearings as to its effects. Notification and discussion with Members of Congress and Committee staffs was nonexistent. Further, this type of proposal, as the Department of Defense and the Corps are well aware, will require enactment of legislation, which has neither been proposed nor requested to date. Therefore, no funds provided in this Act or any previous Act to any agency shall be used to implement this proposal.

Total funding. The $7.0 billion total appropriation for the Corps in this package is an all-time high (excluding emergency funding, which comes along every few years and can more than double the regular Corps budget – see Katrina, Sandy, Harvey-Maria). This total is $2.25 billion (47 percent) more than the final $4.75 billion Corps funding total in the sequestration year of FY 2013. The chart below shows the trend (dollar amounts on the left axis are millions of dollars of budget authority).

Chronic OMB underfunding. The systemic mismatch between what the White House Office of Management and Budget requests for new projects (the Construction account) and the studies that will eventually lead to new projects (the Investigations account) is getting ridiculous. Ever year, OMB requests total funding for these accounts that is far lower than the previous year’s appropriation – but OMB is secure in the knowledge that Congress will always, always, restore this funding. So it is the equivalent of OMB “padding” the budget request to make it look a billion dollars or so lower than it realistically is.

This is a bipartisan trend – under Presidents dating back at least to Jimmy Carter, OMB has just not liked the symbiotic relationship between the Corps and Congress.

In the FY 2019 cycle, OMB requested a total of $992 million for these accounts, which was $1.2 billion below the total that Congress was in the process of appropriating for 2018 when the 2019 budget was submitted.  The total for these accounts in the new 2019 conference agreement is $2.308 billion, which is $1.3 billion more than the request.

The chart below shows how this OMB-versus-Congress mismatch on these accounts has grown since 1997.

Reminder: Every budget document, bill, hearing, report, debate and agreement on the fiscal year 2019 federal transportation and infrastructure budget can be found at 

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