Rural Water Projects:

Federal Assistance Criteria Related to the Lewis and Clark Rural Water Project

T-RCED-98-231: Published: Jun 18, 1998. Publicly Released: Jun 18, 1998.

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GAO discussed selected rural water projects, including the Lewis and Clark Rural Water Project, focusing on: (1) the criteria for participation in specified programs of the Department of Agriculture (USDA), the Environmental Protection Agency (EPA), and the Bureau of Reclamation (BOR) for funding rural water projects; (2) how the characteristics of the individual projects align with the criteria of the identified programs; and (3) the views of officials of the three agencies as to the appropriateness of their being tasked with these projects.

GAO noted that: (1) both USDA and EPA have programs under which rural communities that meet specific criteria may receive grants or loans for the construction of rural water projects, but BOR has no established program for funding rural water projects and therefore has no eligibility criteria; (2) instead, BOR has undertaken such projects when tasked by Congress; (3) both USDA and EPA require, among other things, that recipients demonstrate the ability to repay the loans provided to them; (4) despite its lack of eligibility criteria, BOR, which has concentrated its activities in 17 western states, does have a long-standing policy on full reimbursement for its contributions to local projects; (5) the characteristics of the Lewis and Clark project do not meet some of the criteria for participation in either USDA's or EPA's program, nor BOR's long-standing reimbursement policy; (6) specifically, the project relies on grants rather than loans and thus does not meet the criteria for economic feasibility and repayment; (7) officials of the three agencies agreed that the project would meet real needs in the communities; and (8) however, they expressed concerns about project construction costs and noted that the project envisions the federal government's funding a higher percentage of the project than is allowed under agencies' policies.

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