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DRAFT CORPS OF ENGINEERS CONTRACTS: Louisiana Coastal Area, Mississippi River Gulf Outlet, and Lake Pontchartrain & Vicinity. Presented to the Coastal Protection and Restoration Authority July 11, 2008. Louisiana Coastal Area. Feasibility study on 6 ecosystem restoration projects

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DRAFT CORPS OF ENGINEERS CONTRACTS:Louisiana Coastal Area,Mississippi River Gulf Outlet, andLake Pontchartrain & Vicinity

Presented to the Coastal Protection and Restoration Authority

July 11, 2008


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Louisiana Coastal Area

  • Feasibility study on 6 ecosystem restoration projects

    • Multipurpose operation of Houma navigation lock

    • Terrebonne basin barrier shoreline restoration

    • Small diversion at Convent/Blind River

    • Amite River diversion canal modification

    • Medium diversion at White’s Ditch

    • Convey Atchafalaya river water to northern Terrebonne marshes


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Louisiana Coastal Area(continued)

  • Cost Share Agreement

    • CPRA to be Non-Federal Sponsor

    • NFS & Corps each lead on 3 projects

    • 50% NFS cost share

    • NFS work-in-kind projected to be 50%, so no payment anticipated by NFS

  • Purpose is to determine feasibility of the projects


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Mississippi River Gulf Outlet

  • Construction

    • MRGO closure structure

    • Ecosystem restoration measures

  • Memorandum of Agreement

    • Full federal cost

    • Corps to construct

    • CPRA to be Non-Federal Sponsor

    • NFS to operate and maintain, and acquire necessary property rights


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Lake Pontchartrain & Vicinity

  • Construction

    • Accelerate completion of unconstructed portions of original project

    • Modify original project to improve performance and armor critical portions

    • Raise levee heights and enhance original project to provide level of protection to achieve NFIP certification


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Lake Pontchartrain & Vicinity(continued)

  • CPRA to be Non-Federal Sponsor

  • Partnering and Cost Share Agreement

    • Full federal expense for completion of original project

    • Full federal expense for improvement of original project

    • 35% NFS cost share for raising levee heights and enhancing original project

  • NFS to perform WIK, O&M, property acquisition


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Common issues

  • Corps has complete control

    • For full federal and cost-shared work, Corps determines completion and turnover

      • Protection and/or performance

      • O&M cost

    • For cost-shared work, Corps determines Corps costs and NFS credit

      • Amount of NFS payment for Corps work

      • Amount of credit for NFS work

      • Corps determines expenditure of State funds


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Common issues(continued)

  • Hazardous substance remediation

    • CERCLA liability can be huge and unknown

    • Corps position is that this is 100% NFS cost

    • Property owner liable under CERCLA

  • Use of federal program funds

    • Corps requires express authorization

    • Has been a problem in the past

    • Standard should be absence of prohibition


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LCA-specific issues

  • Total costs capped, but Corps could “crowd out” NFS costs

    • Corps can incur more than 50% share

    • Corps can “allocate” NFS costs to excess category

    • As a practical matter, NFS may have to agree to increase total costs

  • Availability of credits for pre-Agreement work

  • NFS ability to audit Corps expenditures


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MRGO-specific issues

  • Construction at full federal expense, but:

    • NFS to acquire necessary property rights (agreed; credit if possible)

    • NFS to perform environmental investigation and remediation

  • Clarification of “completion” versus “maintenance”

  • No dispute resolution mechanism


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LPV-specific issues

  • NFS cannot agree or disagree to include or incur costs

  • NFS cannot cost-share all of the same types of costs as Corps

  • Credit limitations

    • May be impermissible

    • No reimbursement for WIK above NFS cost share


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LPV-specific issues(continued)

  • No NFS or third-party review of disagreement

    • NFS comments during construction

    • NFS comments on completion

    • NFS request for warranty work

    • Credit for property, relocations, and improvements

    • Corps determination of funds due


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LPV-specific issues(continued)

  • NFS responsible for:

    • Acquisition of necessary property rights

    • Relocations - Roads, railroads, pipelines

    • Building improvements for disposal of dredged material from construction

    • Interior drainage & pumping plants – No credit

    • Commandeering – No credit for defense

    • CERCLA remediation – No credit


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LPV-specific issues(continued)

  • Confusing cost-share payment scheme

    • Appears to require up-front payment despite credit for WIK, etc., with reimbursement later

  • Problematic property rights process

    • Preference for commandeering

    • Provision of other gov’t agency property

    • Unrealistic time frames for acquisition


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Conclusion

  • All three Agreements are more favorable to NFS than past PCAs

    • Corps has agreed to some improvements

  • Some additional improvements are still necessary

  • Negotiations are ongoing


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