Budget Request - BOR

Fiscal Year 2006 Budget Request for the Bureau of Reclamation 






APRIL 7, 2005

Good afternoon. On behalf of the Secretary of the Interior, I am pleased to be here today before the Subcommittee on Energy and Water Development to discuss the fiscal year 2006 budget for the Department of the Interior.  I appreciate the opportunity to highlight our priorities and key goals. 

The Department of the Interior’s mission is complex and multifaceted. Our 70,000 employees contribute to the Nation’s environmental quality, economic vitality, and the well being of communities.  Our mission encompasses resource protection, resource use, recreation, and scientific, educational, and other services to communities.

The Department’s geographically dispersed responsibilities are inspiring and sometimes challenging. Through our programs, we have close connections to America’s lands and people. We protect some of the Nation’s most significant cultural, historic, and natural places. We provide access to resources to help meet the Nation’s energy and water needs, while protecting natural and cultural resources. We provide recreation opportunities to over 477 million people annually at our parks, refuges, and the public lands we manage.  In addition, we fulfill trust and other responsibilities to American Indians, Alaska natives, and the Nation’s affiliated island communities.

Four principles shape our 2006 budget. First is the power of partnerships to leverage resources and achieve results.  Second is the imperative of fiscal constraint.  Third is an emphasis on investments that will help Interior work smarter, more efficiently, and more effectively.  Fourth is the importance of funding activities and programs linked to core Departmental responsibilities.

Budget Overview

Performance lies at the center of the President’s 2006 budget request.  The President’s proposal also demonstrates the fiscal restraint necessary to halve the deficit by 2009 and maintain the Nation’s dynamic economy. 

The 2006 budget request for current appropriations is $10.8 billion.  Permanent funding that becomes available as a result of existing legislation without further action by the Congress will provide an additional $4.2 billion, for a total 2006 Interior budget of $15 billion.  We estimate that the Department will collect $13.8 billion in receipts.

Our budget includes $981.1 million for programs funded in the Energy and Water Development Appropriations Act, a reduction of $31.5 million or 3.1 percent below the 2005 enacted level.

The 2006 Bureau of Reclamation request for current appropriations is $946.7 million, a net decrease of $18.2 million below the 2005 enacted level. The request for current appropriations is offset by discretionary receipts in the Central Valley Project Restoration Fund and by a proposal to offset $30.0 million through direct funding of certain hydropower operations and maintenance activities, resulting in a net discretionary request of $872.8 million, a decrease of $45.8 million below the 2005 enacted level. This decrease is primarily due to the 2006 hydropower direct funding proposal.  The request for permanent appropriations in 2006 totals $80.0 million.

Our budget also includes $9.8 billion for programs funded in the Interior and Related Agencies Appropriations Act, a decrease of $69.7 million or 0.7 percent from the 2005 level. 

In his February 2nd State of the Union Address, the President underscored the need to restrain spending in order to sustain our economic prosperity.  As part of this restraint, it is important that total discretionary and non-security spending be held to levels proposed in the 2006 budget.  The budget savings and reforms in the budget are important components of achieving the President's goal of cutting the budget deficit in half by 2009 and we urge the Congress to support these reforms. The Department will continually work with the Congress to achieve these savings.

Central Utah Project Completion Act

The 2006 request for the Central Utah Project Completion Account provides $34.4 million for use by the District, the Commission, and the Department to implement Titles II - IV of the Act, which is $13.3 million less than the 2005 enacted level.  A substantial portion of this decrease is due to a transfer of budgetary authority and responsibility from the Department of the Interior to the Western Area Power Administration (WAPA).  WAPA is requesting $6.7 million for this purpose, and will transfer it to the Department of the Interior for use on the CUP.  Of those funds, some will go to administrative expenses for the Mitigation Commission, and the balance will be added to the corpus of the Utah Reclamation Mitigation and Conservation Account, which is projected to have a balance of $150 million by the end of fiscal year 2006.  The reduced request for the Mitigation Commission reflects the Commission’s substantial carryover balances from prior year appropriations. 

The funds requested for the District ($31.3 million) will be used to fund the balance of the Federal share of the completed Diamond Fork System ($14.6 million); to continue construction on Uinta Basin Replacement Project ($12.2 million); and to implement water conservation measures, local development projects, and continue planning and NEPA compliance for the Utah Lake System ($4.5 million).


The Bureau of Reclamation is the largest supplier of water in the 17 western States. It maintains 471 dams and 348 reservoirs with the capacity to store 245 million acre-feet of water. These facilities deliver water to one in every five western farmers covering about 10 million acres of irrigated land and provides water to over 31 million people for municipal, and industrial uses. Reclamation is also the Nation’s second largest producer of hydroelectric power, generating 42 billion kilowatt hours of energy each year from 58 power plants. In addition, Reclamation’s facilities provide substantial flood control, as well as many recreation and fish and wildlife benefits.

Since its establishment in 1902, Reclamation has developed water supply facilities that have contributed to sustained economic growth and an enhanced quality of life in the western States. Lands and communities served by Reclamation projects have been developed to meet agricultural, tribal, urban, and industrial needs. Reclamation continues to develop authorized facilities to store and convey new water supplies.

The 2006 request for Water and Related Resources, Reclamation’s principal operating account is $801.6 million, which is $51.0 million below the enacted amount for FY 2005. The account total includes an undistributed underfinancing reduction of $30.2 million in anticipation of delays in construction schedules and other planned activities.

The budget proposal continues to emphasize assuring operation and maintenance of Bureau of Reclamation facilities in a safe, efficient, economic, and reliable manner; ensuring systems and safety measures are in place to protect the public and Reclamation facilities; working smarter to address the water needs of a growing population in an environmentally responsible and cost-efficient manner; and assisting States, Tribes, and local entities in addressing contemporary water resource issues. During development of Reclamation’s budget request, funding for every project is reviewed based on Departmental and Bureau priorities and for compliance with the strategic plan.

The 2006 budget request for Water and Related Resources provides a total of $391.7 million for facility operations, maintenance, and rehabilitation.  Providing adequate funding for these activities continues to be one of Reclamation’s highest priorities.  The Bureau continues to work closely with its water customers and other stakeholders to ensure these funds are used to allow the timely and effective delivery of project benefits; ensure the reliability and operational readiness of Reclamation’s facilities;  identify, plan, and implement dam safety corrective actions and site security improvements; and undertake work to enhance environmental values.

A total of $69.9 million is requested for the safety of dams program, an increase of $6.4 million. This funding includes $44.6 million to initiate safety of dams corrective actions and $18.5 million for safety evaluations of existing dams.

The 2006 request for Water and Related Resources also includes a total of $440.1 million for resource management and development activities.

Water 2025 – Preventing crises and conflict in the West

Meeting water needs is one of the most pressing resource challenges in some of the fastest growing areas of the Nation. In the West, demands for water for cities, Tribes, farms, and the environment exceed the available supply in many basins even under normal water supply conditions, as currently managed. Severe drought conditions over the past several years in the West have amplified water supply and management challenges. Without improved water management, conflicts and crises surrounding water supplies will likely increase.

The overarching goal of Water 2025 is to meet the challenge of reducing crises and conflict over water. To minimize or avoid these water crises and enhance water delivery, Water 2025 advances three basic concepts in the 2006 budget request:

  • The implementation of water monitoring, measuring, conservation, and management technologies will provide some of the most cost-effective gains in the ability to meet the demand for water in the future.
  • The attainment of economic, social, and environmental goals relating to water supply requires long-term stability that is more likely to be provided by collaborative solutions than by litigation.
  • Market-based tools that rely on willing buyer/willing seller transactions are far more likely to provide stability and avoid conflict than are regulatory or litigation-based alternatives for meeting unmet and emerging needs for water.

Solutions developed through Water 2025 must be based on and recognize interstate compacts and U.S. Supreme Court decrees that allocate water among States, water rights established under State and Federal law, tribal water rights, and contracts for the use of water.

The 2006 budget requests $30.0 million for Water 2025, an increase of $10.5 million above the 2005 enacted level. The request includes funds for system optimization reviews, the Water 2025 challenge grant program, and improved technology.


The Sacramento-San Joaquin Delta serves as the hub of the State’s water management system. The Sacramento and San Joaquin Rivers and their tributaries, provide potable water for two-thirds of California’s homes and businesses, and irrigate more than seven million acres of farmland on which 45 percent of the Nation’s fruits and vegetables are grown. The Delta its tributaries and downstream service areas also provide habitat for 750 plant and animal species, some listed as threatened or endangered.

Established in May 1995, the California-Federal Bay-Delta Program (CALFED) is a comprehensive program to address the complex and interrelated problems in the Bay-Delta system, the watersheds that feed it, and the areas served by waters diverted out of it. A consortium of Federal and State agencies fund and participate in the CALFED program, focusing on ecosystem improvements and improving water management and supplies.  In addition, CALFED addresses  issues related to flood control, levees, water quality and watersheds.

After preparation of environmental documentation, the CALFED parties, including Interior, signed a record of decision formally approving a long-term programmatic plan for restoring ecosystem values and improving water management in the solution area. Approximately $68 million was specifically provided to Reclamation in 2001 through 2005 within various authorized programs of the Central Valley Project for activities that support the goals of the CALFED program. Beyond these funds, Reclamation and the other Federal agencies participating in the CALFED program fund numerous other programs and activities that are closely aligned with the CALFED program.

On October 25, 2004, the President signed into law the Calfed Bay-Delta Authorization Act. The legislation provides a six-year Federal authorization to implement the collaborative plan for restoration and enhancement of the San Francisco Bay/Sacramento- San Joaquin Delta estuary.

The 2006 budget includes $35.0 million for Reclamation to implement CALFED activities. 

Other Bureau of Reclamation Project Requests

The $128.0 million request for the Central Valley Project includes a $3.1 million increase for the CVP replacements, additions, and maintenance program. Maintaining strong funding for these activities is critical to maintaining the long-term integrity of Reclamation’s infrastructure. The 2006 request includes $16.6 million for the Colorado – Big Thompson project, an increase of $5.6 million.

A total of $50.0 million is requested for site security to ensure the safety and security of facilities, an increase of $6.8 million. The 2006 budget proposes that the operation and maintenance-related security costs for Reclamation facilities be reimbursed by project beneficiaries, consistent with the practice for other operation and maintenance expenses.

The budget includes $52.0 million for the Animas La Plata project to continue implementation of the Colorado Ute Settlement Act. This will provide for continued construction of the Ridges Basin Dam and the Durango pumping plant.

The request funds rural water supply projects at $57.5 million, $29.5 million below the 2005 enacted level. Funding is requested for the Mni Wiconi, Garrison, and Lewis and Clark projects. The overall reduction is due, in part, to a decrease of $17.0 million resulting from the projected completion of the Mid-Dakota rural water project in 2005. The balance of the reduction results from a decision to focus primarily on ongoing rural water projects until establishment of a formal Reclamation rural water program, as recommended in earlier PART and common measures evaluations.  The Administration submitted legislation to the 108th Congress to establish such a program, and looks forward to working with the 109th Congress to create a program that addresses the present programmatic problems.

The budget proposes to re-allocate repayment of capital costs of the Pick-Sloan Missouri Basin program. Power customers would be responsible for repayment of all construction from which they benefit, whereas to date they have only been responsible for a portion of the costs. This change would increase reimbursements from power customers by $33.0 million in 2006, and declining amounts in future years. Rate increases for power customers could be phased in over time. Authorizing legislation will be submitted.

Management Excellence

As public demands for Interior services increase – from Indian children who need schools to visitors who seek more outdoor recreational opportunities on our public lands – Interior must continue to enhance service and spend dollars wisely. Behind all our programs, out of the limelight, rests a management foundation through which we strive to improve program efficiency and effectiveness. The Departments and its bureaus continue to implement performance improvements.

Reclamation and the Central Utah Project continue to strive for excellence in the President’s management initiatives, which include competitive sourcing, strategic work force management, improved financial performance, expanded electronic government, and integrated budget and performance. The Bureau of Reclamation is committed to the Administration’s management reform agenda and has developed road maps for getting green ratings on its scorecards. Reclamation’s use of activity-based cost management data, together with modifications to Reclamation’s field-driven budget formulation process, will integrate performance and budget in Reclamation’s decision-making process.

As part of its 2006 budget development process, Reclamation and OMB evaluated the recreation program and the water management/supply planning and construction program using the Program Assessment Rating Tool process. The recreation program was rated adequate. The water management/supply planning and construction program was rated results not demonstrated, pending development of performance measures and base line data that assess progress toward bureau and strategic plan goals.  The operations and maintenance portion of the water management/supply program, the site security program, the safety of dams program, and the Central Utah Project will be evaluated by PART during the development of the 2007 budget.

The National Academies' National Research Council is reviewing Reclamation’s organizational infrastructure as it relates to its core mission of delivering water and power. The NRC held its first committee meeting February 28 to March 1, 2005, and should conclude its report during 2005.

Our 2006 budget also includes investments in tools to enable our employees to do their jobs more efficiently and generate cost savings by implementing standardized systems.

The Department currently uses 26 different financial management systems and over 100 different property systems. Employees must enter procurement transactions multiple times in different systems so that the data are captured in real property inventories, financial systems, and acquisition systems. This fractured approach is both costly and burdensome to manage. We have underway an integration of our financial and business management systems to streamline and modernize basic administrative activities.

The Department’s budget request includes an increase of $9.5 million to support continued implementation of the Financial and Business Management System, which is integrating financial management, procurement, property management and other systems and will be the basis for reengineered administrative processes throughout the Department.  As FBMS becomes fully operational, over 80 legacy systems will be retired and their functionality replaced by standardized business processes within FBMS.   In 2006, the National Park Service and Fish and Wildlife Service are scheduled to transition to FBMS.  The Bureau of Reclamation will transition to FBMS in 2007.

The 2006 Department budget also includes an increase of $7.0 million to continue implementation of the Enterprise Services Network.  ESN leverages the existing BIA Trustnet, expanding it Department-wide, to provide secure, state-of-the-art internet and intranet connections and a fully functional operational center for data communications.  In addition to providing better services for many Interior offices, the system will provide a uniformly secure environment, standardized and efficient 24 hour/7 day operations, and improved technical support.  The Reclamation budget includes $1.1 million for ESN.

Addressing other Departmental Challenges

Over the past four years, the Interior Department has encouraged cooperative conservation through various grant programs, administrative actions, and policies. These efforts emphasize innovation, local action, and private stewardship.  Water 2025 is an excellent example.  They achieve conservation goals while maintaining private and local land ownership. They foster species protection through land management and cooperative, on-the-ground habitat improvements, complementing traditional funding of ESA regulatory programs. 

Two proposals in the Interior Appropriations Act are of particular relevance to this Subcommittee - Klamath River Basin and Everglades, which demonstrate our ability to work across the landscape cooperatively to accomplish our goals.

Klamath River Basin – The 2006 budget commits $62.9 million toward addressing water issues in the Klamath Basin and proposes an 8.4 percent increase for Interior Department programs in the basin.  In the short-term, water-supply conditions will continue to present challenges. As of mid-February, the snow pack in the upper Klamath River basin was 47 percent below average. With depleted groundwater supplies and expected continued drought conditions, the risks to endangered and threatened fish in the basin persist.  We also anticipate impacts to the people and communities dependent on the river, including upper basin irrigators and downstream Indian and commercial fishermen.  Federal efforts in the basin will continue to focus on long-term solutions to resolving conflicts between the many competing uses for scarce water.

Everglades Restoration – Interior is also continuing its work with the Corps of Engineers and the State of Florida to complete the Modified Water Deliveries Project (Mod Water), a key to restoring natural flows in the Everglades.  The Mod Water project includes water control structures to restore more natural hydrologic conditions within the Park as well as a flood mitigation system to protect adjacent residential and agricultural areas.  The ability to deliver adequate supplies of clean water at the right time of the year is critical to the restoration of the Park’s natural resources.  Once completed, this project will provide much needed flexibility to water managers and serve as a strong foundation for future benefits under the Comprehensive Everglades Restoration Plan (CERP).

Under a new agreement between the Department and the Corps of Engineers, the cost to complete the project will be shared by NPS and the Corps.  Within the 2006 request for NPS construction is $25.0 million.  The NPS contribution consists of $8.0 million in new funding and $17.0 million redirected from unobligated balances for Everglades land acquisition not currently needed for high-priority acquisitions.  The 2006 budget for the Corps includes $35.0 million for the project.  Over the period 2007 to 2009, the Corps will contribute an estimated additional $88.0 million and the NPS an additional $41.0 million.

Other Cooperative Conservation Programs – Through partnerships, Interior works with landowners and others to achieve conservation goals across the Nation and to benefit America’s national parks, wildlife refuges, and other public lands.  The 2006 budget includes $381.3 million for the Department’s cooperative conservation programs. These programs leverage limited Federal funding, typically providing a non-Federal match of 50 percent or more. They provide a foundation for cooperative efforts to protect endangered and at-risk species; engage local communities, organizations, and citizens in conservation; foster innovation; and achieve conservation goals while maintaining working landscapes.

Our budget proposes funding for the Landowner Incentive and Private Stewardship programs at a total of $50.0 million, an increase of $21.4 million from 2005. Through these programs, our agencies work with States, Tribes, communities, and landowners to provide incentives to conserve sensitive habitats in concert with traditional land management practices such as farming and ranching, thus maintaining the social and economic fabric of local communities.

Our budget proposes to fund challenge cost-share programs in BLM, FWS and NPS at $44.8 million.  These cost-share programs better enable Interior’s land management agencies to work together and with adjacent communities, landowners, and other citizens to achieve common conservation goals.  The 2006 proposal represents an increase of $25.7 million.

The challenge cost-share program includes $21.5 million for projects that are targeted to natural resource conservation.  In 2004, the Congress provided $21.2 million for these cost-share grants.  Leveraged with matching funds this provided a total of $52 million for on-the-ground projects including more than $19 million for projects to eradicate and control invasive species and weeds.

For example, in New Mexico, the Bosque del Apache refuge is working with the local community to restore riparian habitat along the Rio Grande River by eliminating tamarisk on over 1,100 acres. 

We also propose level or increased funding for a suite of other FWS cooperative programs: the Partners for Fish and Wildlife program, the Coastal program, the Migratory Bird Joint Ventures program, the North American Wetlands Conservation Fund, the State and Tribal Wildlife grants program, and the Cooperative Endangered Species Conservation Fund. These programs support a cooperative approach to conservation that emphasizes voluntary partnerships with private landowners, local governments, Tribes, and community organizations.


The budget plays a key role in advancing our vision of healthy lands, thriving communities, and dynamic economies.  Behind these numbers lie people, places, and partnerships.  Our goals become reality through the energy and creativity efforts of our employees, volunteers, and partners. They provide the foundation for achieving the goals highlighted in our 2006 budget.

This concludes my overview of the 2006 budget proposal for the Department of the Interior and my written statement.  I will be happy to answer any questions that you may have.

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