B-163310, APRIL 10, 1968, 47 COMP. GEN. 535

B-163310, APRIL 10, 1968, 47 COMP. GEN. 535

HIGHWAYS - CONSTRUCTION - FEDERAL-AID HIGHWAY PROGRAMS - RELOCATION COSTS - SAFETY PROGRAMS THE RETROACTIVE MODIFICATION OF HIGHWAY RELOCATION CONTRACTS BY THE CORPS OF ENGINEERS TO PERMIT COMPLIANCE WITH THE HIGHWAY SAFETY ACT, PUBLIC LAW 89-564, AND TO CHARGE INCREASED COSTS AS PROJECT EXPENSES, MAY NOT BE AUTHORIZED, ABSENT AUTHORITY IN THE ACT, WHICH PROVIDES FOR FEDERAL ASSISTANCE TO THE STATES TO COORDINATE AND ACCELERATE NATIONAL HIGHWAY SAFETY PROGRAMS, TO INCLUDE IN RELOCATION CONTRACTS, THE LIBERAL COST CRITERIA CONTAINED IN PUBLIC LAW 87-874. THEREFORE, BEFORE THE INCREASED COSTS OF HIGHWAY SAFETY PROGRAMS MAY BE RETROACTIVELY ASSUMED BY THE CORPS OF ENGINEERS, AND CHARGED TO THE PROJECT INVOLVED, SPECIAL AUTHORITY SHOULD BE REQUESTED FROM THE CONGRESS.

TO THE SECRETARY OF THE ARMY, APRIL 10, 1968:

LETTER DATED JANUARY 11, 1968, FROM THE ACTING SPECIAL ASSISTANT (CIVIL FUNCTIONS), ENCLOSES FOR OUR CONSIDERATION AN ADMINISTRATIVE REPORT, PREPARED BY THE DISTRICT ENGINEER, U.S. ARMY ENGINEER DISTRICT, SEATTLE, WASHINGTON, AS CONTRACTING OFFICER, REQUESTING AUTHORITY TO AMEND CONTRACT NO. DA-45-108 CIVENG-66-68 WITH THE MONTANA STATE HIGHWAY COMMISSION FOR RELOCATION OF MONTANA STATE HIGHWAY NO. 37 IN CONNECTION WITH THE DEVELOPMENT OF THE LIBBY DAM PROJECT. ALSO, ENCLOSED IS A DOCUMENT ENTITLED "LEGAL ANALYSIS" BY THE ACTING DISTRICT COUNSEL, SEATTLE DISTRICT, CORPS OF ENGINEERS.

THE PERTINENT FACTS AND CIRCUMSTANCES, AS DISCLOSED BY THE ACTING SPECIAL ASSISTANT'S LETTER AND ENCLOSURES, ARE SET FORTH BELOW:

LIBBY DAM AND ITS RESULTANT RESERVOIR WILL INUNDATE A PORTION OF MONTANA STATE HIGHWAY NO. 37 (MSH 37). DESIGN MEMORANDUM NO. 9 WITH THE SUPPLEMENTS THERETO, AS APPROVED, DISCUSSES IN DETAIL THE PROPOSED METHOD OF RELOCATING THIS PRIMARY STATE HIGHWAY OUTSIDE THE INFLUENCE OF THE DAM AND POOL. BASED UPON THESE DESIGN MEMORANDUMS, NEGOTIATIONS FOR A CONTRACT OF RELOCATION WERE HELD WITH THE STATE OF MONTANA COMMENCING ON SEPTEMBER 23, 1965, AND RESULTED IN A SIGNED CONTRACT DATED FEBRUARY 14, 1966.

DESIGN STANDARDS FOR THE RELOCATED FACILITY, AS CONTAINED IN THE "DESIGN MEMORANDUM" AND IN THE FINAL CONTRACT, WERE CONSONANT WITH SECTION 207 OF THE FLOOD CONTROL ACT OF 1960, AS AMENDED BY PUBLIC LAW 87-874, 76 STAT. 1173, 16 U.S.C. 460D, THESE STANDARDS BEING THE THEN CURRENT HIGHWAY STANDARDS OF THE STATE OF MONTANA. THIS WAS INCORPORATED INTO THE CONTRACT BY ARTICLE 1D, WHICH READS AS FOLLOWS:

DESIGN STANDARDS FOR THE PERMANENT RELOCATION OF MSH-37 SHALL BE IN ACCORDANCE WITH SECTION 208 (C) OF P.L. 87-874 (76 STAT. 1173) APPROVED 23 OCTOBER 1962, AND THE PUBLISHED STANDARDS, AS OF THE DATE OF THIS RELOCATION CONTRACT, OF THE STATE COVERING THE CONSTRUCTION OF "PRIMARY AND SECONDARY HIGHWAYS," AND AN ADT TRAFFIC COUNT OF 600, IN MOUNTAINOUS TERRAIN.

PUBLIC LAW 89-564, 80 STAT. 731, 23 U.S.C. 401, APPROVED SEPTEMBER 9, 1966, SOME 6 MONTHS AFTER THE CONTRACT WAS SIGNED, WAS AN ACT TO PROVIDE FOR A COORDINATED NATIONAL HIGHWAY SAFETY PROGRAM THROUGH FINANCIAL ASSISTANCE TO THE STATES TO ACCELERATE HIGHWAY SAFETY PROGRAMS. THE ENACTMENT OF PUBLIC LAW 89-564 CAUSED THE BUREAU OF PUBLIC ROADS, DEPARTMENT OF TRANSPORTATION, TO INCREASE HIGHWAY CONSTRUCTION STANDARDS APPLICABLE TO STATES DESIRING TO PARTICIPATE IN THE FEDERAL AID PROGRAM. THE RESULT IS THAT THE MONTANA HIGHWAY COMMISSION IS REQUESTING THAT THE RELOCATION CONTRACT BE MODIFIED TO INCLUDE THE HIGHER STANDARDS FOR THE RELOCATED PORTION OF MSH 37 AT AN ESTIMATED INCREASE OF $1,830,000 CHARGEABLE TO LIBBY DAM PROJECT. A CONFERENCE WAS HELD WITH THE STATE OF MONTANA AND CORPS OF ENGINEERS (CORPS) REPRESENTATIVES ON AUGUST 14, 1967. IN SUBSTANCE, IT WAS DISCLOSED AT THE CONFERENCE THAT THE STATE HAD NO FUNDS TO FINANCE THE REQUESTED IMPROVEMENTS. THE STATE'S POSITION IS THAT, SINCE THE ADDITIONAL REQUIREMENTS WERE IMPOSED BY THE FEDERAL GOVERNMENT, THEY SHOULD BE FINANCED BY THE FEDERAL GOVERNMENT, SPECIFICALLY, THE CORPS OF ENGINEERS. FOLLOWING THIS MEETING, THE STATE, BY LETTER, AGAIN REQUESTED THAT THESE ADDITIONAL SAFETY REQUIREMENTS BE INCORPORATED INTO THE DESIGN STANDARDS AND REQUESTED THE CONTRACT BE REFORMED TO REQUIRE THE CORPS OF ENGINEERS TO PAY THE ADDITIONAL COST.

IF THE INCREASED COST IS NOT ALLOWED AS A PROJECT EXPENSE, THE STATE WOULD BE REQUIRED TO BEAR THE FULL COST AS A BETTERMENT OR PRORATA COST WITH BUREAU OF PUBLIC ROADS AID. HOWEVER, THE REGIONAL OFFICE OF THE BUREAU HAS REPORTEDLY ADVISED THE STATE THAT IT DECLINED TO PARTICIPATE IN THE ADDED COST OF SAFETY FEATURES.

OUR DECISION ON THE ISSUE PRESENTED IN THE ADMINISTRATIVE REPORT IS REQUESTED.

ALSO, ENCLOSED IS AN ADMINISTRATIVE REPORT PREPARED BY THE DISTRICT ENGINEER, UNITED STATES ARMY ENGINEER DISTRICT, JACKSONVILLE, FLORIDA, ON CONTRACT NO. DACW17-67-C-O102 WITH THE STATE ROAD DEPARTMENT OF FLORIDA FOR RELOCATION OF STATE ROAD NO. 40 IN CONNECTION WITH THE CROSS FLORIDA BARGE CANAL PROJECT. THE ISSUE IS COMPARABLE TO THAT IN THE MONTANA CASE. THE ESTIMATED INCREASE IN COSTS IS $568,000 FOR STATE ROAD NO. 40 AND $5,000,000 FOR THE OVERALL PROJECT.

IT IS REQUESTED FURTHER THAT OUR DECISION BE MADE COMPREHENSIVE IN ITS APPLICATION NOT ONLY TO THE TWO CASES HEREWITH BUT ALSO TO OTHERS OF SIMILAR NATURE WHICH MAY ARISE AS A RESULT OF THE INCREASED STANDARDS.

BOTH THE ADMINISTRATIVE REPORT AND THE "LEGAL ANALYSIS," WITH RESPECT TO THE MONTANA STATE HIGHWAY, REFER TO OUR DECISION OF JUNE 15, 1961, 40 COMP. GEN. 697, AS A BASIS FOR AUTHORIZING THE CHIEF OF ENGINEERS TO MODIFY THE RELOCATION CONTRACTS TO INCLUDE THE HIGHER STANDARDS, THE INCREASED COSTS THEREOF TO BE CHARGED TO THE LIBBY DAM PROJECT.

OUR DECISION OF JUNE 15, 1961, 40 COMP. GEN. 697, INVOLVED SECTION 207 (B) OF THE FLOOD CONTROL ACT OF 1960, 74 STAT. 501, APPROVED JULY 14, 1960, WHICH READS AS FOLLOWS:

THAT, FOR SUCH WATER RESOURCES PROJECTS, UNDER CONSTRUCTION OR TO BE CONSTRUCTED, WHEN THE TAKING BY THE FEDERAL GOVERNMENT OF AN EXISTING PUBLIC ROAD NECESSITATES REPLACEMENT, THE SUBSTITUTE PROVIDED WILL AS NEARLY AS PRACTICABLE SERVE IN THE SAME MANNER AND REASONABLY AS WELL AS THE EXISTING ROAD. THE CHIEF OF ENGINEERS IS AUTHORIZED TO CONSTRUCT SUCH SUBSTITUTE ROADS TO DESIGN STANDARDS COMPARABLE TO THOSE OF THE STATE IN WHICH THE ROAD IS LOCATED, FOR ROADS OF THE SAME CLASSIFICATION AS THE ROAD BEING REPLACED. THE TRAFFIC EXISTING AT THE TIME OF THE TAKING SHALL BE USED IN THE DETERMINATION OF THE CLASSIFICATION.

SECTION 207 (B) WAS AMENDED AND RENUMBERED SECTION 207 (C) BY PUBLIC LAW 87-874, APPROVED OCTOBER 23, 1962, AND NOW READS AS FOLLOWS (33 U.S.C. 701R-1./C) ):

(C) FOR WATER RESOURCES PROJECTS TO BE CONSTRUCTED IN THE FUTURE, WHEN THE TAKING BY THE FEDERAL GOVERNMENT OF AN EXISTING PUBLIC ROAD NECESSITATES REPLACEMENT, THE SUBSTITUTE PROVIDED WILL, AS NEARLY AS PRACTICABLE, SERVE IN THE SAME MANNER AND REASONABLY AS WELL AS THE EXISTING ROAD. THE HEAD OF THE AGENCY CONCERNED IS AUTHORIZED TO CONSTRUCT SUCH SUBSTITUTE ROADS TO DESIGN STANDARDS COMPARABLE TO THOSE OF THE STATE, OR, WHERE APPLICABLE STATE STANDARDS DO NOT EXIST, THOSE OF THE OWNING POLITICAL DIVISION IN WHICH THE ROAD IS LOCATED, FOR ROADS OF THE SAME CLASSIFICATION AS THE ROAD BEING REPLACED. THE TRAFFIC EXISTING AT THE TIME OF THE TAKING SHALL BE USED IN THE DETERMINATION OF THE CLASSIFICATION. IN ANY CASE WHERE A STATE OR POLITICAL SUBDIVISION THEREOF REQUESTS THAT SUCH A SUBSTITUTE ROAD BE CONSTRUCTED TO A HIGHER STANDARD THAN THAT PROVIDED IN THE PRECEDING PROVISIONS OF THIS SUBSECTION, AND PAYS, PRIOR TO COMMENCEMENT OF SUCH CONSTRUCTION, THE ADDITIONAL COSTS INVOLVED DUE TO SUCH HIGHER STANDARD, SUCH AGENCY HEAD IS AUTHORIZED TO CONSTRUCT SUCH ROAD TO SUCH HIGHER STANDARD. FEDERAL COSTS UNDER THE PROVISIONS OF THIS SUBSECTION SHALL BE PART OF THE NONREIMBURSABLE PROJECT COSTS. IT SHOULD BE NOTED THAT 207 (B) WAS APPLICABLE TO THE CORPS OF ENGINEERS AND 207 (C) IS APPLICABLE TO THE CORPS OF ENGINEERS AND THE BUREAU OF RECLAMATION.

AS WE UNDERSTAND IT, AT THE TIME THE RELOCATION AGREEMENTS INVOLVED IN OUR DECISION OF JUNE 15, 1961, WERE ENTERED INTO, THE STATE STANDARDS IN EFFECT FOR ROADS OF THE SAME CLASSIFICATION IN THE STATE INVOLVED WERE BETTER OR HIGHER STANDARDS THAN THOSE OF THE EXISTING HIGHWAY, I.E., THE ROAD TO BE RELOCATED. HOWEVER, THE RELOCATION AGREEMENTS PROVIDED FOR "REPLACEMENT IN KIND" IN ACCORDANCE WITH CORPS' POLICY IN EFFECT AT THE TIME THE AGREEMENTS WERE ENTERED INTO. HENCE, THE QUESTION AROSE AS TO WHETHER RELOCATION AGREEMENTS ENTERED INTO PRIOR TO THE ENACTMENT OF SECTION 207 (B) COULD BE MODIFIED TO PROVIDE FOR CONSTRUCTION OF THE SUBSTITUTE ROAD UNDER THE MORE LIBERAL CRITERIA SET FORTH IN SECTION 207 (B), I.E., TO MEET THE STATE STANDARDS FOR ROADS OF THE SAME CLASSIFICATION, AS DISTINGUISHED FROM "REPLACEMENT IN KIND.'

IN THE DECISION IN QUESTION WE STATED THAT: CLEARLY, IN THE ABSENCE OF ANY APPLICABLE STATUTORY PROVISIONS, THE STATE OF OKLAHOMA WOULD BE BOUND BY THE TERMS OF THESE RELOCATION AGREEMENTS; AND THERE WOULD BE NO BASIS UPON WHICH THE GIVING UP, WITHOUT CONSIDERATION, OF GOVERNMENT RIGHTS UNDER THE AGREEMENTS COULD BE JUSTIFIED. BUT THE CONGRESS MAY BY APPROPRIATE LEGISLATION AUTHORIZE MODIFICATION OF GOVERNMENT CONTRACTS WITHOUT CONSIDERATION. THE QUESTION FOR RESOLUTION, IN THE INSTANT CASE, THEREFORE IS WHETHER AND TO WHAT EXTENT THESE RELOCATION AGREEMENTS, WHICH WERE ENTERED INTO BUT NOT COMPLETELY PERFORMED BEFORE THE EFFECTIVE DATE OF SECTION 207 (B), SHOULD BE MODIFIED TO CONFORM WITH THE COST-SHARING CRITERIA OF THAT SECTION. WE, IN EFFECT, CONSIDERED SECTION 207 (B) AS LEGISLATION AUTHORIZING THE MODIFICATION OF RELOCATION AGREEMENTS ENTERED INTO BY THE CORPS PRIOR TO THE EFFECTIVE DATE OF SECTION 207 (B), WITHOUT CONSIDERATION, IN THAT IT WAS INTENDED TO PROVIDE CRITERIA TO BE FOLLOWED BY THE CHIEF OF ENGINEERS FOR ALL HIGHWAY RELOCATIONS COVERED, EVEN THOUGH THE AGREEMENTS HAD BEEN REACHED TO EFFECT RELOCATION ON SOME OTHER BASIS "PRIOR TO THE ENACTMENT OF THAT SECTION.'

THUS, WE HELD THAT SECTION 207 (B) AUTHORIZED THE MODIFICATION OF RELOCATION AGREEMENTS ENTERED INTO PRIOR TO ITS ENACTMENT, AT LEAST AS TO HIGHWAY RELOCATION WORK NOT LET TO CONSTRUCTION CONTRACTS AS OF THE DATE OF APPROVAL OF THE ACT. WE DID NOT HOLD, OR INTEND TO HOLD, HOWEVER, THAT RELOCATION AGREEMENTS ENTERED INTO AFTER THE DATE OF ENACTMENT OF SECTION 207 (B) COULD BE MODIFIED TO INCLUDE DESIGN STANDARDS NOT PROVIDED FOR IN SUCH AGREEMENTS. SUCH A HOLDING WOULD BE CONTRARY TO WHAT IS STATED ABOVE CONCERNING THE GIVING UP OF GOVERNMENT RIGHTS UNDER AN AGREEMENT WITHOUT CONSIDERATION, ABSENT APPROPRIATE LEGISLATION.

IT SHOULD BE NOTED THAT WE STATED IN THAT DECISION THAT "ANY RELOCATION AGREEMENT THAT MIGHT HAVE BEEN REACHED PRIOR TO SECTION 207 (B) WOULD NECESSARILY HAVE BEEN UPON LESS FAVORABLE TERMS THAN SECTION 207 (B) AUTHORIZES.' THAT STATEMENT, OF COURSE, WOULD NOT NECESSARILY APPLY TO RELOCATION AGREEMENTS ENTERED INTO AFTER THE ENACTMENT OF SECTION 207 (B), SINCE THERE COULD HAVE BEEN INCLUDED THEREIN THE BENEFITS CRITERIA AUTHORIZED BY THE SECTION.

WHILE WE INDICATED IN THE DECISION OF JUNE 15, 1961, THAT THE STATUS OF THE RELOCATION WORK RATHER THAN WHETHER OR NOT A RELOCATION AGREEMENT WAS SIGNED CONTROLS APPLICATION OF SECTION 207 (B), THIS STATEMENT MUST BE CONSIDERED IN LIGHT OF THE QUESTION PRESENTED FOR DECISION, AND THIS IS THE CONTEXT IN WHICH IT WAS USED IN THE DECISION. IN OTHER WORDS THIS STATEMENT WAS MADE HAVING IN MIND ONLY RELOCATION AGREEMENTS ENTERED INTO BEFORE THE ENACTMENT OF SECTION 207 (B), AND NOT THOSE ENTERED INTO SUBSEQUENT TO THE ENACTMENT OF SUCH SECTION.

SECTION 207 (C), AS QUOTED ABOVE, WAS IN EFFECT ON THE DATE THE RELOCATION AGREEMENT INVOLVING MSH 37 WAS ENTERED INTO. IN FACT, THE AGREEMENT PROVIDES THAT THE DESIGN STANDARDS FOR THE ROAD INVOLVED SHALL BE IN ACCORDANCE WITH SECTION 208 (C) (207 (C) ( AND THE PUBLISHED STANDARDS "AS OF THE DATE OF THIS RELOCATION CONTRACT, OF THE STATE COVERING THE CONSTRUCTION OF -PRIMARY AND SECONDARY HIGHWAYS' AND AN ADT TRAFFIC COUNT OF 600, IN MOUNTAINOUS TERRAIN.' SINCE THE DATE THE MSH 37 RELOCATION AGREEMENT WAS ENTERED INTO, NO STATUTE HAS BEEN ENACTED OF WHICH WE ARE AWARE WHICH HAS THE EFFECT OF AUTHORIZING THE CORPS OF ENGINEERS TO MODIFY PREVIOUSLY ENTERED INTO RELOCATION AGREEMENTS SO AS TO PERMIT THE CORPS TO CONSTRUCT THE SUBSTITUTE ROADS TO STANDARDS HIGHER THAN THE STATE STANDARDS IN EFFECT ON THE DATE THE RELOCATION AGREEMENT WAS SIGNED.

WHILE THE HIGHWAY SAFETY ACT, PUBLIC LAW 89-564, PROVIDES FOR A NATIONAL HIGHWAY SAFETY PROGRAM, IT DOES NOT AUTHORIZE THE CORPS OF ENGINEERS TO INCLUDE MORE LIBERAL COST CRITERIA IN RELOCATION CONTRACTS AS DID SECTION 207 (B). THEREFORE, WE DO NOT CONSIDER THE PRESENT CASE ANALOGOUS TO 40 COMP. GEN. 689.

ACCORDINGLY, IT IS OUR VIEW THAT THE CHIEF OF ENGINEERS IS NOT AUTHORIZED TO MODIFY RELOCATION AGREEMENTS ENTERED INTO SUBSEQUENT TO THE ENACTMENT OF SECTION 207 (C) (OR SECTION 207 (B) (, SO AS TO INCLUDE THEREIN HIGHER STATE DESIGN STANDARDS THAN THOSE PROVIDED FOR IN THE AGREEMENT AND IN EFFECT IN THE STATE CONCERNED ON THE DATE THE RELOCATION AGREEMENT INVOLVED WAS ENTERED INTO AND TO PROVIDE THEREIN THAT THE INCREASED COSTS RESULTING FROM SUCH MODIFICATION SHALL BE CHARGEABLE TO THE CORPS' PROJECT INVOLVED. IF THE CORPS IS TO ASSUME THE INCREASED COSTS UNDER CIRCUMSTANCES SUCH AS HERE INVOLVED, WE BELIEVE THAT SPECIFIC AUTHORITY TO DO SO SHOULD BE GRANTED BY THE CONGRESS.