The Way Ahead for the Gulf Intracoastal Waterway

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The Way Ahead for the Gulf Intracoastal Waterway
Mike Kidby 9 August 2005
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A Time of Change

• Long term erosion of the CW budget
• Post 9-11 focus on the GWOT
• Leaner discretionary budgets
• Aging infrastructure
• Increasing environmental regulatory impact
• Reliability increasingly critical to business
  success
• Infrastructure not a national priority

3
Civil AppropriationsConstant Dollars (FY 95)FY
67 -- FY 03(Dollars in Billions)
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A Changing Corps

• Performance-Based Budgeting
• Watershed or systems approach part of Strategic
  Plan
• A focus on risk reliability and asset
  management
• vertical integration from district to HQUSACE
  (2012)
• Enhancing relationships building strategic
  alliances
• Greater interagency cooperation
• Stakeholders must participate in managing risks
• Smarter more effective communication

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Number of Infrastructure Emergency Closures
6
Cost of Emergency Closuresand Needed Repairs
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Changing Budget Realities

• Corps Budget to meet all needs 6B
• Corps must ensure reliability of essential
  waterways
• OMB focus on merit of investments not spreading
• Rigor of the process will continue to increase
  and become more accountable
• Emergency operational issues can have significant
  impact
• Congress will demand more rigor
• 5 year planning
• System approach
• Limits on reprogramming
• Continuing contracts

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CW Budget History
(Millions)

06 06 06
03
Act 04 Act 05 Bud 05 Act Budget House
Senate General Investigations 134 117
91 145 95 100
180 Operation Maint. 1967 1968 1934
1959 1979 2000 2100 Construction,
General 1745 1722 1437 1796 1637 1900
2087 Miss. River Tribs. 342 324 270
324 270 290 433 Regulatory Program
138 140 150 145 160 160
150 Fld Control Cstl Emer 15 0
50 0 70 0
43 F.U.S.R.A.P. 144 140 140 165 140
140 140 General Expenses 154
160 167 167 162 152
165 ASA(CW) 0 0 0 4
0 4 0 Total 46
39 4571 4238 4705 4513 4746 5298  
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Situational Awareness of Drivers

• Competitive Sourcing
• Waterway Action Plans
• Asset Management
• Greater inter-agency collaboration
• Performance-Based Budgeting continues
• Congressional oversight intensifies
• Corps and stakeholders must manage risk
• Communication strategy on value essential

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Waterways Action Plan Partnership

• During recent high water/flow events within the
  USCG 8th District, USCG/nav industry/Corps could
  have been more efficient with planning, response
  and recovery activities
• Terminology, communication, organization,
  updating of existing Crisis Action Plans (CAPs)
• Umbrella Waterways Action Plan (WAP) with key
  waterway CAPs as updated annexes
• Inland Waterways with existing CAPs
• Upper and Lower MS River and Major Tributaries
• Ohio River and Major Tributaries
• McClellan-Kerr Arkansas River
• Other waterways in other regions of the nation
• Corps input Define infrastructure and waterway
  terminology, action thresholds, points of
  contact, better understanding of partner
  organizations.

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The Way Ahead

• The GIWW must be managed as a system
• Budget development work activities must
• be guided by risk reliability
• System management must be done in a
• collaborative manner w/stakeholders
• This work must be tied into the PBB process

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The Way Ahead - Musts

• The GIWW must be managed as a system
• Request receive funds as a system
• Layout objective annual plan w/stakeholder input
• Grade scorecard at EOY with stakeholders
• Systems communication strategy focused on value
  to the Nation and region
• Execute requirements as a system-do not
• sub-optimize

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Risk Reliability Assessment

• Risk-based analysis
• What is risk of an event?
• What is impact?
• Goal to spend available funding on existing
  infrastructure where it will reduce risk,
  increase reliability and provide the best return
  for investment

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Collaboration w/Stakeholders

• Focus is on system and benefit is for system
• With aging infrastructure, constrained
• Budgets, and changing business models we must
• manage risk together
• This work must be part of our budget development
• process
• Communication essential and this approach
• will add value

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Performance-Based Budgeting(PBB)

• Must have granularity to support budget
• input-requires team approach
• Rigor is required..5 year or 10-yr planning
• Plan your work and work your plan
• PBB will evolveits a tool, not an enemy

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Situational Awareness

gt 1M tons
lt 1M tons and/or 1 B ton-miles
Houston (0.02/t) GIWW (0.03/t
Big Sandy (0.04/t)
lt2/ton
gt2/ton
Ouachita (6/t)
Humboldt (5/t) McClellan-Kerr (2.50/t)
Harbor Types WW, DD, LDD, etc
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Challenges for PBB
Last Years
This Years Response

• Lack of data for ranking projects
• Identify data needed better definitions
• Develop effective efficient process to collect
  data
• Quality Control
• Funding
• Ranking criteria for OM GI whats best to
  define performance?
• Optimization of budget given funding constraints
  what is proper mix?
• Within business program
• Among business programs
• What is ASA(CW) and OMB going to want?

• Field better recognizes data needs
• Stakeholders participate in revising criteria
• Basic data still an issue
• Still expectation for past funding levels
• Using must have for OM
• Separate O and M items
• Risk based
• Prescribed Initial increment
• Mix among business programs still based upon
  historical levels
• Learned from last year and earlier discussions
  new requirements will still come up, such as
  systems and segments and 2/ton , 5-yr Management
  Plans

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Performance-based Programming

• Provide Safe, Reliable, Efficient, Effective, and
  
• Environmentally Sustainable Navigation to the
  Nation
• Get projects on line to start generating benefits
• Keep projects operating
• Address new problems
• Provide tools and support for above
• Budget Ranking Criteria
• 5 year planning cycle

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Budget Ranking Criteria
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Budget Ranking Criteria(contd)
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Key Prioritization Factors

• Studies (GI)
• Signed agreement
• High-use Commercial projects
• Construction (CG)
• Dam Safety
• RBRCR
• Completions
• High Risk Major rehabs
• Operations / Maintenance (OM)
• must have
• of project availability
• High risk maintenance requirements

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Achieve Reliability by Justified Investments
Ideal No-Risk Level
High
Low ROI
Acceptable Risk Level
Operational improvements
Reliability Level
System Reliability
Maintenance completion
Justified ROI
New construction completion
Low
Time
Target Date
Today
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Additional Performance Indicators

• MSC Rank
• Phase phase completion date
• Initial / Increment
• New / Continuing
• Total BCR (7)
• RBRC Ratio (7)
• 5-Yr Avg Commercial Tons
• 5-Yr Avg Sys Ton-miles
• 5-Yr Avg Cost/Ton
• Latest Yr Commercial Tons
• Latest Yr Sys Ton-miles

• Total Project Cost
• Completion date
• Watershed
• Other purpose outputs

• of time project is available to perform as
  designed
• Portfolio risk (Dam safety)
• Legal / safety issues
• Consequences
• Purpose
• Remarks

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Initial Definition

• No new GI or CG starts or phases
• No more than the amount in the FY 2006 budget for
  that study or PED zero if no longer likely to
  produce a high performing project
• Funding (CG) needed (no more, no less) for
  estimated contractor earnings and associated
  contract management costs for contracts funded in
  FY 2006 continuing into FY 2007 zero if not
  budgeted or considered for suspension
• OM must have or bare bones O and M
• greatest benefit for the investment consistent
  with performance measures and sufficient to meet
  minimum legal responsibilities for environmental
  compliance, operation and safety
• Additional increments to add demonstrated
  increases in performance
• High risk maintenance
• Starting point to build performance based budget
  75
• "Initial" does not mean "Adequate"

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OM INITIAL INCREMENT
  What is included
What is not
1. Bare Bones Operations costs (locks)
May
not be full 24-hour operation  2. Bare Bones
maintenance (locks)
would not be all
maintenance needs   3. Dredging high use
commercial deep draft and inland projects
no advanced maintenance dredging or high
use segments of projects 4. Dredging subsistence
harbors
 5.
Dredging Critical harbors of refuge
does
not include all harbors of refuge  6. On-going
major maintenance of high use proj/segments
does not include new major
maintenance  7. Critical maintenance of disposal
areas for 3 above
does not include routine maintenance of CDFs  8.
Critical studies for high risk coastal structures
does not
include studies of all structures 9. Bare bones
debris removal/obstruction removal at high use
ports does not include all projected
removal needs  10. Critical studies to complete
DMMP for CDF construction not
routine, non time critical DMMPs  11. On-going
(studies and work) major rehabs of high-use
projects does not include new rehabs  12.
Critical Removal of Aquatic growth (RAG)
does not include
all removal of aquatic growth  
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INCREMENT 1.1

• RAG for high use projects
• PCS (include low use)
• new start gate replacement /rehab study on high
  risk, system impacts
• Critical advanced maintenance dredging on hi use
  projects
• Caretaker funding for projects or segments not
  expected to be funded
• critical on-going non-routine maintenance
• dredging and operations of low-use subgroup that
  have commerce, commercial fishery, multi agency
  requirements, and/or public transportation
•  

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Challenges for PBB
Last Years
This Years Response

• Lack of data for ranking projects
• Identify data needed better definitions
• Develop effective efficient process to collect
  data
• Quality Control
• Funding
• Ranking criteria for OM GI whats best to
  define performance?
• Optimization of budget given funding constraints
  what is proper mix?
• Within business program
• Among business programs
• What is ASA(CW) and OMB going to want?

• Field better recognizes data needs
• Stakeholders participate in revising criteria
• More time to prepare
• Basic data still an issue
• Still expectation for past funding levels
• Using must have for OM
• Separate O and M items
• Risk based
• Prescribed Initial increment
• Mix among business programs still based upon
  historical levels
• Learned from last year and earlier discussions
  new requirements will still come up, such as
  systems and segments and 2/ton , 5-yr Management
  Plans

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Partnership

• PBB requires more rigor
• Corps must be accountable
• Cannot be done w/o stakeholders _at_ table
• We are managing risk and we must manage it
  together
• 5 year plan will facilitate our partnership

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Questions????