REVOLUTIONIZE USACE CIVIL WORKS U S Army Corps

REVOLUTIONIZE USACE CIVIL WORKS U. S. Army Corps of Engineers February 2019

REVOLUTIONIZE USACE CIVIL WORKS Overview § Background on Infrastructure Initiative § Describe Revolutionize USACE Civil Works § USACE WIFIA Program Development Progress and Challenges § Next Steps 2

ADMINISTRATION’S INFRASTRUCTURE INITIATIVE BACKGROUND § Administration’s goal: seek and secure long-term reforms on how infrastructure projects are regulated, funded, delivered, and maintained. § President has proposed a $200 B federal commitment to produce a $1. 5 T overall investment in infrastructure. § The infrastructure legislative principles were publicly released on 12 February 2018 and can be found here: https: //www. whitehouse. gov/wpcontent/uploads/2018/02/INFRASTRUCTUR E-211. pdf. § The Administration has also asked agencies to improve infrastructure delivery by pursuing changes that do not require legislation. 3

REVOLUTIONIZE USACE CIVIL WORKS THREE OBJECTIVES DESIRED END STATE Accelerate Project Delivery Start and finish projects faster Transform Project Financing and Budgeting More efficient project delivery using alternative financing tools and new budgeting processes Improve Permitting and Regulation Reform Streamlined permit processes and elimination of duplicative reviews to expedite delivery of projects 4

REVOLUTIONIZE USACE CIVIL WORKS Transform Project Financing and Budgeting Problems to Address: § Insufficient funding for the Nation’s infrastructure needs § Unpredictable funding for federal projects Focus Areas: § Implement Alternative Financing Tools - Water Infrastructure Finance and Innovation Act (WIFIA) Loans - Public-Private Partnership (P 3) policy § Revolutionize Civil Works Budgeting § Increase Funding Flexibility 5

REVOLUTIONIZE USACE CIVIL WORKS Transform Project Financing and Budgeting USACE WIFIA Program Development: § Purpose: Accelerate non-federal investment in water resources infrastructure by providing long-term, low-cost loans to credit-worthy borrowers § Initial Focus: Non-federal water resources infrastructure § Estimated Need: Existing non-federal dams and levees require investment of more than $120 B - Infrastructure projects are delayed or never implemented due to financing market gap (high up-front capital costs & 30 + year term) - USACE WIFIA will fill this market gap § Benefits: Water resources infrastructure provides physical and economic security to the nation & reduces federal disaster spending 6

REVOLUTIONIZE USACE CIVIL WORKS Transform Project Financing and Budgeting WIFIA Program Development: § Accomplishments to Date ü MOU with EPA signed ü Program Development Plan completed per OMB guidance ü Credit subsidy model (draft completed) q On-going Actions: q Finalize credit subsidy model q Develop program structure and rules (spring 2019) q Prepare to issue loans q Challenges: q Credit subsidy appropriation needed to issue loans 7

REVOLUTIONIZE USACE CIVIL WORKS FURTHER INFORMATION § USACE WIFIA next steps - Complete development of WIFIA policies, implementation rule, and program documentation - Subject to appropriations: - Issue Notice of Funding Availability - Position USACE to issue WIFIA loans as soon as possible § USACE public website for information: http: //www. usace. army. mil/Missions/Civil. Works/Infrastructure/ § Direct input, feedback, or meeting requests to: CW. Infrastructure. Team@usace. army. mil 8

BACKUP 9

REVOLUTIONIZE USACE CIVIL WORKS Transform Project Financing and Budgeting Challenges: q P 3 Call for Proposals: q Inability to collect, retain and reinvest fees q Inability to make commitments on future appropriations q Lack of enabling framework and authorities for P 3 projects q WIFIA: q OMB support for WIFIA in the USACE budget q Credit subsidy appropriation needed to issue loans q Civil Works Budgeting: q Finalize multi-year budget approach q Develop justification and support for new approach q Develop specific actionable recommendations (internal and external) 10

REVOLUTIONIZE USACE CIVIL WORKS Transform Project Financing and Budgeting Key Actions In Progress: q P 3 Call for Proposals: q Internal and external stakeholders q External: Call for P 3 pilot concepts in Federal Register q WIFIA: q Finalize credit subsidy model q Development of program structure and rules (spring 2019) q Credit subsidy appropriation necessary to issue loans q Civil Works Budgeting: q Finalize multi-year budget approach q Develop justification and support for new approach q Develop specific actionable recommendations (internal and external) 11