Corps of Engineers and Bureau of Reclamation:

Information on Potential Budgetary Reductions for Fiscal Year 1998

RCED-97-131R: Published: Apr 25, 1997. Publicly Released: Apr 25, 1997.

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GAO provided information about its examination of certain budget accounts of the Army's Corps of Engineers and the Bureau of Reclamation, focusing on trends in the agencies' carryover balances and potential reductions to their fiscal year (FY) 1998 funding requests to reflect the carryover balances expected at the end of FY 1997.

GAO noted that: (1) the Corps has significantly reduced its unobligated carryover balances; (2) for example, between FY 1994 and the end of FY 1996, the Corps reduced unobligated carryover balances in the construction general account from $538 million to about $181 million; (3) a number of factors contributed to the reductions experienced by the Corps, including the periodic review of estimated FY obligations and the ability to reprogram funds; (4) however, GAO identified a total of almost $5.3 million in unobligated carryover balances in the general investigations and construction general accounts that could potentially be used to reduce the Corps' FY 1998 funding request; (5) the unobligated balances resulted in part because the Corps determined that some projects were not feasible or because the Corps was not able to identify nonfederal sponsors to share the costs of the projects; (6) on April 1, 1997, the Corps implemented a plan to reorganize its division offices; (7) although the Corps has at least $4.25 million available to implement the restructuring plan, it will not know for several months how much implementing the plan will cost; (8) similarly, the Bureau has taken various actions to manage its carryover balances, including incorporating such balances into budget requests and periodically reviewing and transferring funds among projects; (9) nevertheless, GAO identified $25.1 million in carryover balances and $93.3 million in funding from Bay-Delta that could potentially be used to reduce the Bureau's FY 1998 funding request; (10) the potential reductions resulted partially because projects were delayed for environmental studies and other reasons; (11) for example, the Bureau has not completed the environmental impact statement for one project; and (12) in another case, the Bureau set up a reserve to purchase water during times of drought; however, the Congress has never been informed that funds would be used for this purpose.

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