Natural Resources and Environment:

Review of Cost-Sharing Arrangements With the State of Oregon for the Operation of Fish Hatcheries, Bureau of Commercial Fisheries, United States Fish and Wildlife Service

B-157612: Published: Feb 17, 1966. Publicly Released: Feb 17, 1966.

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The General Accounting Office has made a review of costsharing agreements entered into by the Bureau of Commercial Fisheries, United States Fish and Wildlife Service, Department of the Interior, and the State of Oregon for operation and maintenance costs of four State fish hatcheries which were expanded and modernized with Federal funds under the Columbia River Fishery Development Program (CRFDP). Our attention was directed to these costsharing agreements during a survey of CRFDP activities in which we observed that the Federal participation in the annual costs of operating and maintaining existing State hatcheries which had been expanded under the CRFDP had increased substantially since the initial cost-sharing agreement was entered into for fiscal year 1953, while the State's participation had remained virtually unchanged. Our review was made pursuant to the Budget and Accounting Act, 1921 (31 U.S.C. 53), and the Accounting and Auditing Act of 1950 (31 U.S.C. 67). Our review dealt primarily with the procedures followed in arriving at the Federal Government's and the State's shares of the annual operation and maintenance costs of the State hatcheries which had been expanded with Federal funds to meet the requirements of the CRFDP. We did not make an overall evaluation of the CRFDP and the costs incurred thereunder. We reviewed laws and regulations pertaining to the organization and functions of the Bureau of Commercial Fisheries and to the establishment of the CRFDP; we examined pertinent operating and financial records relating to the CRFDP at the Bureau's Pacific Region, Seattle, Washington, the Bureau's CRFDP office, Portland, Oregon, and the Oregon Fish Commission, Portland, Oregon; and we interviewed responsible Bureau officials. We examined cost-sharing agreements entered into by the State of Oregon and the United States Army, Corps of Engineers, Portland District, Portland, Oregon, for joint financing of State operated hatcheries expanded or relocated by the Corps.

Since fiscal year 1953, the Federal Government has borne all increases in the operation and maintenance costs incurred under cost-sharing agreements with the State of Oregon for the joint financing of operations at four State fish hatcheries which were expanded and modernized with Federal funds under the Columbia River Fishery Development Program. On the basis of the operating costs experienced at the hatcheries immediately preceding and following expansion, we believe that Federal participation in the operating costs of the hatcheries exceeded its proportionate share by about $720,000 through June 30, 1965. Federal participation in the annual costs of operating and maintaining existing State hatcheries which were expanded under the program has increased substantially since the initial cost-sharing agreement was entered into for fiscal year 1953, while the State's participation has remained virtually unchanged. This situation occurred primarily because the Fish and Wildlife Service did not provide in its initial agreements for a proportionate sharing of subsequent cost increases. In addition, the Fish and Wildlife Service did not consider the State's most recent cost experience in arriving at the State's share of annual operating costs. Unless the cost-sharing arrangements are revised to provide for increased State financial participation, we believe that the Government will continue to incur costs in excess of its proportionate share in future years. On the basis of planning information available at this time, we estimate that additional costs of $316,000 will be incurred during fiscal years 1966 through 1968.

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