Delaware River Deepening Project:

Comprehensive Reanalysis Needed

GAO-02-604, Jun 7, 2002

Additional Materials:

Contact:

Barry T. Hill
(202) 512-9775
contact@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

The U.S. Army Corps of Engineers' February 1992 Final Interim Feasibility Study and Environmental Impact Statement reported that deepening the Delaware River ship channel from 40 to 45 feet was economically justified and environmentally feasible. However, GAO found that it does not provide a reliable basis for deciding whether to proceed with the project. GAO identified several miscalculations, invalid assumptions, and the use of significantly outdated information on the Corps' benefits estimate. In addition, several unresolved issues and uncertainties were not factored into the Corps' economic analysis, the outcome of which could either increase or decrease the benefits and costs of the project. Because of these shortcomings, the actual economic merits of the project will be unclear until the Corps reanalyzes it. The Corps of Engineers has largely addressed the environmental concerns of federal and state environmental agencies. However, several unresolved issues remain, including the issuance of a permit from the state of Delaware governing construction projects that affect state waters.

Status Legend:

More Info
  • Review Pending-GAO has not yet assessed implementation status.
  • Open-Actions to satisfy the intent of the recommendation have not been taken or are being planned, or actions that partially satisfy the intent of the recommendation have been taken.
  • Closed-implemented-Actions that satisfy the intent of the recommendation have been taken.
  • Closed-not implemented-While the intent of the recommendation has not been satisfied, time or circumstances have rendered the recommendation invalid.
    • Review Pending
    • Open
    • Closed - implemented
    • Closed - not implemented

    Recommendations for Executive Action

    Recommendation: Considering the significant problems GAO identified with the Corps' economic justification for the Delaware River project, the Secretary of the Army should direct the Corps of Engineers to engage an external independent party to review the revised economic analysis to ensure that it accurately and fairly represents the expected benefits and costs of the proposed project.

    Agency Affected: Department of Defense: Department of the Army

    Status: Closed - Implemented

    Comments: The Corps of Engineers engaged the services of a consultant to assist the Corps with its reanalysis of the Delaware River Deepening Project, and also engaged an independent party to review the reanalysis. These actions address the intent of GAO's recommendation.

    Recommendation: Considering the significant problems GAO identified with the Corps' economic justification for the Delaware River project, the Secretary of the Army should direct the Corps of Engineers to obtain the information, where possible, that is needed to address the uncertainties--such as changing commodity movements over the last decade and alternative dredging techniques--that could significantly affect project benefits and costs.

    Agency Affected: Department of Defense: Department of the Army

    Status: Closed - Implemented

    Comments: The Corps of Engineers updated benefit and cost information in its reanalysis of this proposed project. The reanalysis showed that the project could be built for $56 million less than it had previously estimated.

    Recommendation: Considering the significant problems GAO identified with the Corps' economic justification for the Delaware River project, the Secretary of the Army should direct the Corps of Engineers to prepare a new and comprehensive economic analysis of the project's benefits and costs, which includes all aspects of the analysis and corrects for the miscalculations, erroneous assumptions, and outdated information contained in the current analysis.

    Agency Affected: Department of Defense: Department of the Army

    Status: Closed - Implemented

    Comments: The Corps of Engineers has committed to, and is currently conducting, a reanalysis of the project, as GAO recommended.

    Recommendation: Considering the significant problems GAO identified with the Corps' economic justification for the Delaware River project, the Secretary of the Army should direct the Corps of Engineers to submit the revised analysis, including the external independent review, to Congress for its use in considering future appropriation requests for the project.

    Agency Affected: Department of Defense: Department of the Army

    Status: Closed - Implemented

    Comments: This recommendation was a procedural step related to a number of other recommendations GAO made to the Corps of Engineers related to the Delaware Deepening project. While the Corps implemented the essence of this recommendation, it does not warrant a separate accomplishment report, as it was simply a procedural step related to several more substantive recommendations.