Coastal States Organization, Inc.

444 N. Capitol Street, NW • Washington, D.C. 20001

Phone: (202) 508-3860 • Fax: (202) 508-3843 • Email: cso@sso.org

Testimony of Tony MacDonald

Executive Director

Before the Committee on Environment and Public Works

U.S. Senate

June 18, 2002

Introduction

Mr. Chairman and Members of the Committee:

Good afternoon. I am Tony MacDonald, Executive Director of the Coastal States Organization (CSO). On behalf of CSO, I want to thank Chairman Jeffords and the Members of the Committee for the opportunity to present testimony on the US Army Corps of Engineers water resources programs and Water Resources Development Act of 2002 (WRDA). Since 1970, the Coastal States Organization (CSO) has represented the Governors of the nation’s coastal and Great Lakes states, Commonwealths and Territories on issues relating to the improved management of coastal development and the protection of coastal resources.

My comments today focus primarily on the need to get beyond the criticism of the implementation of the Corps of Engineer’s current limited single-purpose, project approach to water resources management to building support for an affirmative national policy that encourages efficient and sustained investment in the nation’s water resources and port infrastructure. This must include investment in the nation’s “green” infrastructure including wetlands, critical habitats, nonstructural and natural flood and storm protection features, and the beneficial use of dredged material. In CSO’s view, this can best be achieved by making individual Corps projects accountable to a consistent national policy to manage the nation’s shoreline and navigable waterways. This policy should be supported by an enhanced partnership with the states that builds upon the expertise of states and other local project sponsors in coastal, watershed and basin-wide management.

Pursuant to the Coastal Zone Management Act of 1972 (CZMA), states develop programs for the management of rapidly developing coastal areas, and protection of water dependent uses and coastal resources. Under the CZMA, States must develop a planning process for assessing the effects and ways to control or lessen the impact of improper development in flood prone, storm surge and shoreline erosion prone areas, and to restore areas adversely affected by coastal hazards. Corps and other Federal activities are required to be consistent to the maximum extent practicable with federally approved coastal zone management plans.

Under WRDA ‘86, States share in the cost of Corps Civil Works projects. States also serve as local project sponsors, or work with port authorities and local governments that serve as local project sponsors. States have a public trust responsibility to their citizens to protect coastal resources including navigation, fishing and public access. Increasingly, states and local governments are also embracing initiatives to manage coastal sprawl and collaborative community-based planning and management models such as the National Estuary Programs. Effort to “reform” the Corps must take into account these multipurpose, multi-stakeholder efforts that go beyond traditional economic benefit analysis to take into consideration the value of environmental, cultural and social inputs, as well as so-called national economic development benefits.

Recent conflicts over significant port expansion projects in Delaware River and Charleston, SC and challenges posed by port expansion in places like the Columbia River, Houston and New York demonstrate the importance of a broader incorporation of local and regional concerns into national port planning. A closer look at port project success stories such as Oakland and Houston reveal that port and transportation benefits can and must be matched with environmental restoration and enhancement efforts.

The National Interest in the Coastal Water and Natural Resource Infrastructure

The critical importance of the Corps’ Civil Works programs to the nation should not be lost amidst the often legitimate criticism. More than half of the nation’s population lives within 50 miles of the shore. Our ports and harbors are the nation’s interface with the global economy. Ports are connected by inland waterways and other transportation access to every state. Ninety-five percent of international trade by volume passes through US ports. In 1996, U.S. Customs revenues totaled $15.6 billion. A recent report by the Federal Reserve Bank of Kansas City, The US as a Coastal Nation, observed: “...the coastal concentration of U.S. economic activity reflects a productivity effect of access to navigable water.” In addition, the report examined the significant historical and cultural importance, as well as quality of life factors that draw people to live, work and recreate along the nation’s coasts and beaches.

The coast provides a staging area for fishing fleets, seafood processing, and offshore oil and gas production, as well as supports critical habitats for spawning fish, shellfish and threatened and endangered species. Any visit to the beach confirms that they are the nation’s premier recreation areas. Their beauty and accessibility provide a magnet not only for international visitors, but also provide readily accessible recreation and respite for millions families from diverse urban and rural areas that may not have other options. Travel and tourism is the nation’s largest industry with more than 85 percent of industry revenues being generated in coastal areas. Federal tax revenues from beach tourism activity has been estimated to generate $14 billion in California alone. Most importantly, these same beaches provide protection of life and property as natural barriers to flooding, waves and storm surges. A recent Corps of Engineers study of six coastal communities in North Carolina showed that communities with shore protection projects suffered significantly less from Hurricane Fran.

Arcane cost-benefit ratios and budgeting exercises obscure the full range of benefits — the economic stimulus, tax revenues, environmental protection, and life and property protection — derived from our nation’s coastal infrastructure. For example, we spend billions on constructing highways and transportation corridors to enable people to get to coastal areas and the beach. Yet, to spend several million on ensuring that the beach exists protecting the natural and economic resource which justifies the transit project is characterized by some as extravagant. The entire national budget for beach nourishment projects – approximately $135 million in FY 2002 – would be a virtual rounding error on most significant transportation projects.

I want to dispel several myths which too often distort the debate over shore protection projects.

< Shore protection projects do not simply wash away into the sea. They absorb wave energies that typically save millions of dollars in property damages. Although the sand is lost temporarily from the beach, many times the majority of the sand remains in the littoral system and is either returned to the beach or deposited on downstream beaches.

< Nourishment projects are typically less expensive in current dollars than structural solutions as much of the costs are deferred well into the future while structures must be paid for at the time of initial construction.

< In addition, nourishment projects are preferable to hard structures which would undermine the natural protective features of the shoreline and would be less environmentally acceptable and adversely impact downdrift beaches.

< Finally, the federal investment is justified based on formulating a project for hurricane/storm damage protection and not recreation. In addition, for federal participation, all shore protection projects must have a benefit / cost ratio of greater than 1.0 and more than 50 percent of that justification must be based on storm damage reduction benefits.

In addition to the clear national interest and economic return of investment in the coastal water resource infrastructure, many Corps Civil Works projects have historically had, and continue to have, adverse effects upon the proper functioning of littoral system. Dams, channelization and improvements to navigation including navigational dredging and jetties often disrupt the natural flow of sand and other sediment material resulting in sediment starvation and erosion. While it is a federal responsibility to mitigate damages resulting from these Civil Works projects, current Corps policies only support mitigation of damages directly induced by the project and do not give priority to a comprehensive solution to overall shore protection problems. While it is important to remedy past errors, it is even more important to provide a framework for planning and implementing Corps projects that encourages not simply mitigation but the maximization of economic and environment benefits.

Problems Identified with the Civil Works Program

There are significant opportunities for project savings by simplifying Corps project reviews and allowing local sponsors, working with private sector partners, to take the lead more often in planning and implementing water resource projects. However, given the Corps continued insistence in controlling the planning process and the uncertainties in obtaining sufficient funding to reimburse project sponsors, there is no incentive for the Corps to take advantages of the efficiencies that could be generated by implementing these changes.

There is a catch-22, which is common among all Corps project types, that results from the gap between construction authorizations under WRDA and annual Congressional appropriations for the Civil Works Program. With huge project backlog within the Civil Works Program, the Corps has allocated funding among as many projects as it can keep going. By allocating less funding per project to sustain a greater number of projects, the Corps has lengthened the completion times and costs for projects, and consequently for local project sponsors. Timelier project completion is one of the primary means of reducing costs within the Civil Works Program and reducing the project backlog.

There are fundamental problems with the Civil Works Program which should be addressed in the Water Resources Development Act of 2002.

1. The project by project approach to project planning and authorization does not take into account how projects affect each other, including opportunities for achieving efficiencies among projects or limiting cross-project impacts.

2. It simply takes too long to complete a project. If greater local participation in projects is sought, projects, particularly project studies, needs to be simplified and streamlined.

3. The Corps Districts and Divisions are effectively discouraged from finding creative ways for the beneficial uses of dredged material. The so-called “federal standard,” least-cost environmentally acceptable alternative requirement, favoring open water disposal of clean dredged material, thwarts the long-term cost savings to the federal government and resource benefits resulting from keeping sand within littoral systems. The effect of the least-cost alternative policy is to miss opportunities for environmental restoration and shift costs from the Corps budget to other federal accounts such as disaster assistance due to the lack of protection that would otherwise have been available from sand starved beaches.

4. The full range of benefits resulting from projects, both economic and environmental, are not being credited. For example, states with comprehensive planning in place which limits development along the shore and bans sea walls have difficulty meeting the benefit thresholds for renourishment assistance, thereby penalizing states for good coastal planning. Without the availability of renourishment assistance, the pressure to allow sea walls or other shore protection structures can be overwhelming. The effect of hard structures is increased erosion as wave energy is focused at the point of impact with the wall. With the loss of the beach, the associated recreational, economic and environmental benefits are also lost.

5. The increasing pressure to reduce spending is impairing the ability of the Corps to fulfill its service functions to support state and local efforts. In addition to assistance for project planning and construction, the Corps provides much needed services to states and coastal communities, such as technical advice and data for flood plain management, planning assistance for state constructed projects, and research for improved understanding of coastal littoral systems and project designs.

WRDA 2002: An Opportunity

WRDA 2002 presents the opportunity to improve the Army Corps of Engineers Civil Works Program through requiring more comprehensive and strategic planning, rational project selection, effective project design, and enhancement of the cost effectiveness of Civil Works projects. Making these improvements will require institutional and legal changes, as well as changes in the overall approach to managing the nation’s coastal infrastructure.

There are lessons to be learned by passage of laws like the Estuary Habitat Restoration Partnership Act, which was championed by this Committee. That law not only set out a clear national policy goal of restoring one million acres of estuarine habitat, but also called for the Corps to take the lead in development of a multi-agency national restoration strategy to guide selection of the Corps projects funded under the Act and to serve as guidance other federal, state and local investment in estuarine restoration.

In changing the overall approach to managing coastal water resources infrastructure, we recommend that Congress incorporate the following basic premises:

Our management of coastal infrastructure needs to take a systems-based approach . . ..

The entry and movement of the sediment which forms our shoreline is a dynamic system. Man has made many alterations to the system through the erection of dams, navigational dredging, jetties and groins. While man has altered the system in many ways, we cannot stop it. We can work with the system or against it. The difference is found mostly in long-term project effectiveness and overall costs.

Working within the littoral system, we need to develop a strategy for meeting regional and state needs . . .. We need to move away from taking a project by project approach to the coast and develop a framework that addresses crosscutting coastal shoreline issues along with setting priorities and strategies for meeting our Nation’s coastal infrastructure protection needs including targeted needs for specific inlet and regional management plans.

CSO Recommendations

(1) Use of Dredged Material –

(a) Congress should declare sand within littoral systems a natural resource which is in need of management and conservation.

(b) The federal standard should include a presumption that favors retaining sand within the littoral system.

(c) The authorization for beneficial uses of dredged material under section 204 should be expanded to include beneficial uses in addition to ecosystem restoration but with ecosystem restoration being the priority use of available funds.

Congress should establish a national policy which mandates a preferred alternative to keep sand and sediment within the littoral system. In some cases, the difference between the preferred beneficial use alternative and open water disposal is less than 5 percent of project costs. The Corps is locked into rigid cost-benefit analyses that do not take into account the long-term cost of traditional disposal. If a beneficial use is reasonably available, it should be incorporated into the project design and cost. There should be incentives provided for Districts and Divisions to include environmental restoration and beneficial use into planning and design navigation and other Corps projects. Currently, local projects sponsors are left to patch together a quilt of disparate Corps authorities into a project that meet restoration, protection and water resource goals.

When it is determined through sampling and testing that dredged material from a project or portion of a project, contains predominantly sand or other coarse grained material, the Corps of Engineers, and other agents of the Federal government, should be required to look to the beneficial use of dredged material as the first option for dredged material. The Corps should work with the states and other local partners to provide guidance to the Districts and Divisions on the implementation of best management practices in beneficial use to plan and implement the onshore or near-shore disposal of the dredged material

Congress should remove the institutional and legal constraints which deter better management, e.g., the Corps’ least cost alternative policy which is limited to assessing what is the least costly option to the Corps rather than the least cost.

(2) Regional Sediment Management Planning –

(a) Direct the Assistant Secretary of the Army for Civil Works to study and prepare recommendations including projected resources to carry out a comprehensive program for regional sediment management studies.

(b) Authorize the Corps to amend existing project authorities and expand the construction and maintenance of navigation projects that promote the natural movement of sediments

With the objective of improved information-based decision making, increased project coordination and more cost effective management, Congress should direct the Corps to develop a plan to undertake regional sediment management. The plan should include estimates of baseline data requirements and their maintenance, and cost-savings from implementation.

The project-by-project approach to responding to shoreline change is costly, inefficient and sometimes inconsistent. The nation’s water resources policy long ago recognized that in order to manage rivers effectively, the entirety of the river and its surrounding watershed needs to be considered. The same needs to be done for managing the nation’s shoreline. Shoreline management requires an understanding of the littoral processes and systems occurring along the shore, sediment sources and their movement within the system.

The goal of regional sediment management (RSM) is to manage sand for coastal projects on a regional scale. RSM recognizes that the dynamics of littoral systems extend beyond individual, local-scale projects. Regional sediment management planning will provide an inventory and strategic vision of regional coastal sediment management needs. RSM planning will identify, evaluate and prioritize sediment management approaches in a Geographic Information System framework that coordinates existing information into one body of knowledge that can be applied to efficient implementation of sediment management projects. By synthesizing data from past and current projects on a regional basis, opportunities to address multiple sediment-related problems can be developed and redundant studies avoided.

In addition to providing a better understanding of littoral systems, regional sediment management can provide improved information on the environmental, economic and social consequences of proposed actions and potential tradeoffs associated with management decisions. RSM can improve planning, development, damage reduction, and resource management in coastal regions resulting in reduced federal and local sponsor expenditures for channel maintenance and nourishment of storm-damage reduction projects.

Among leading experts in the field of coastal processes and shoreline management, there is already strong support for the RSM concept. The Strategic Plan for the Corps of Engineers Coastal Engineering program produced by the Congressionally chartered Coastal Engineering Research Board (CERB) has recommended the adoption of a systems approach to coastal sediment management.

The objectives of RSM are within reach with new monitoring, modeling, and information management capabilities. Several RSM demonstration projects are already underway–

Northern Gulf of Mexico Regional Sediment Management (RSM) Demonstration Program – covers the shorline of Mississippi, Alabama and the northern Gulf coast of Florida. The product of the demonstration program will be a Regional Sediment Management Plan consisting of a calibrated regional sediment budget, a calibrated numerical regional prediction system, and a regional data management and Geographic Information System. These tools will assist in making management decisions and will increase benefits resulting from improved sand management throughout the region.

California Coastal Sediment Management Master Plan — is a collaborative effort between federal, state, and local agencies and non-governmental organizations to evaluate California’s coastal sediment management needs on a regional, system-wide basis.

Great Lakes Regional Sediment Management – The Great Lakes region has been designated as one of the demonstration sites for regional sediment management. The region being studied is from Ludington, Michigan at the north end, to Michigan City, Indiana at the south. This 172-mile region contains 11 Federal structures, several of which have Section 111 beach nourishment programs in place. The goals of the Great Lakes demonstration project are: to identify key stakeholders who have a role in sediment management for the Southeast Lake Michigan Region; collect available coastal data and develop a centralized web page and GIS database for use by all regional stakeholders; improve current coastal programs and Corps operations and maintenance performance by linking navigation, dredging, disposal, and beach nourishment projects; and, to implement regional sediment management practices for the southeast region of Lake Michigan. These results will have direct ties to the operation of the Section 111 program, the National Shoreline Management Study, the Lake Michigan Potential Damages Study, and the National Erosion Control Development and Demonstration Program.

Additional demonstration sites are planned for the New York/New Jersey, New England, North Carolina/Virginia, and the Pacific Northwest.

The Corps also should be authorized to expand the design and maintenance of navigation projects to promote the natural movement of sediments to benefit adjacent shorelines and beaches. Small amounts of additional spending for activities like advanced maintenance, sand bypassing, berm building and catchment basin pump-out can enhance the movement of sand to produce environmental and economic benefits. The Corps presently has some authority to promote better sediments management. For example, the Corps can protect, restore or create aquatic habitat using dredged material (Section 204 of WRDA 92) and place suitable material on adjacent beaches (Section 145 of WRDA 76). But these authorities are difficult to apply to sediment management measures with indirect, delayed or cumulative benefits, and activities with widespread beneficiaries across multiple communities or states. These authorities should be supplemented by authorizing the Corps to undertake additional federal expenditures to promote proper sediment management.

(3) Amend the Authorization for the National Shoreline Study –

(a) Congress should amend the authorization for the National Shoreline Study (Section 215, WRDA 99) to require that it be conducted by an independent body under a set time frame and budget,

(b) The study reauthorization should also include a specific directive for state and federal interagency participation including but not limited to the Corps. NOAA, USGS, and FEMA;

(c) The study authorization should include a directive that the study be conducted using and analyzing existing information and studies.

Section 215 (c) of the Water Resources Development Act of 1999 requires the Corps to prepare a report describing the —

C Extent of erosion and accretion along the shores of the U.S.;

C Economic and environmental effects of shoreline change;

C Systematic movement of sand along the shores of the U.S.; and

C Resources committed by federal, state and local governments to restore and renourish beaches.

The report is to include recommendations on the —

C Use of a systems based approach to sand management; and

C Appropriate levels of federal and non-federal participation in shore protection.

The study will bring into full view the geophysical, anthropogenic, economic and environmental factors needed to be assessed in order to improve the nation’s policy to manage the shoreline in a manner which fulfills multiple objectives.

Much of the data and information required for the completion of this study has already been developed. The Corps has a wealth of project specific data including information being developed by on-going regional sediment management demonstration projects. FEMA, through the John H. Heinz Center, recently completed a Congressionally mandated study of erosion and its economic impacts, The Hidden Costs of Coastal Hazards. NOAA, through the use of LIDAR laser technology, employed by the Coastal Services Center (CSC), has remapped the shoreline of most of the continental U.S. CSC is also converting analog data contained on over 14,000 T-sheets to a GIS format. This will provide an electronic record of shoreline change for much of the coast. The USGS Coastal and Marine Geology Program has already compiled excellent regional and local studies of the coastal geologic framework of the U.S. Much of the most comprehensive information about shoreline change and related economic and environmental impacts has been developed by states.

The National Shoreline Study is particularly timely in two respects. First, it has been nearly 30 years since the first National Shoreline Study was completed in 1971. The new study will provide an opportunity to re-examine the critical erosion areas identified in the original study to determine what has happened in those areas in terms of geophysical processes and the responses to shoreline change. The new study will determine whether the number of critical erosion areas has increased and, more importantly, whether the vulnerability in those areas has increased. The new Study is also warranted and particularly timely given recent leaps in technology and methodology. In just the last few years, a technology threshold has been crossed which has provided the opportunity to examine shoreline process utilizing complex modeling like never before. It is expected that an ancillary benefit of the National Shoreline Study, which may even exceed the prescribed outcomes for the study, will be improved interagency cooperation and data integration.

The National Shoreline Study is a necessary step towards examining and reassessing federal and state programs and policies responding to shoreline change. It is hoped that the study will provide a stimulus and objective basis for —

C Recognizing a shared national interest in responding to shoreline change;

C Developing a systems based approach to responding to shoreline change through a better understanding of shoreline processes; and

C Integrating federal agency policies and processes, including data and information sharing, to tailor shoreline change response decisions to littoral systems and regional objectives.

Completion of the study has been hampered by an oversight in the authorization for the study. Without an express authorization of funding, it has been difficult for the Corps, Office of Management and Budget, and Congressional appropriators to have a sense of the scale and funding parameters of the study and we request that Congress included a specific funding authorization and completion date based on the date when appropriations are made available.

To this end, we also request that Congress amend the study authorization with a specific directive that the study is to be conducted using and analyzing existing data and information. Congress should also specify that the study is to be conducted making use of information to be made available from the United States Geological Survey, National Oceanic and Atmospheric Administration and Federal Emergency Management Agency, and close cooperation with the states.

Thank you for the opportunity to testify before you. I am pleased to answer any questions.