EP 1165-2-1
30 Jul 99
Federal sponsor receives credit for the fair market value of the land
after the required action, but does not receive credit for the cost of
undertaking the required action.
6-18. Dam Safety Assurance. Dam safety assurance modifications are
those modifications which are required by new hydrologic or seismic
data or changes in state-of-the-art design or construction criteria
deemed necessary for safety purposes. These criteria are defined more
specifically in ER 1110-2-1155. Work that does not meet these
criteria is accomplished as maintenance or as major rehabilitation.
All dam safety assurance modifications are subject to the cost sharing
requirements of Section 1203 of WRDA 1986:
a. Section 1203(a)(1). Costs incurred in dam safety assurance
modifications shall be recovered: Fifteen percent of the cost of the
modification is to be assigned to project purposes in accordance with
the cost allocation in effect for the project at the time the
modification is initiated, and shared in accordance with cost sharing
in effect at the time of initial project construction. Costs assigned
to irrigation will be recovered by the Secretary of the Interior in
accordance Public Law 98-404. The basis for cost sharing will be the
cost sharing for the basic project, based on a cost allocation,
project or local cooperation agreement, letter of assurance from a
local interest, or contract for use of storage, whichever was used for
initial project construction cost sharing or for subsequent
reallocation.
b. Section 1203(a)(2). Repayment of costs, except for costs
assigned to irrigation, may be made, with interest, over a period not
to exceed 30 years from the date of completion of the work.
c. Cost Recovery. Recovery of the non-Federal share of the
dam safety assurance modification cost will be determined by the
current arrangement for project cost recovery. For costs which are
reimbursable through the sale of power, the share of dam safety cost
will be reported to the power marketing agency for recovery in the
same manner as major rehabilitation costs. For cost sharing based on
a project local cooperation agreement which does not have a provision
for dam safety cost sharing, the agreement will need to be modified to
include the dam safety costs, or a new agreement will be required.
Where the project cost sharing was based on a letter of intent, an
agreement will be negotiated with the sponsor. In the case of water
supply, the existing contract may need to be modified, or a new
contract signed to cover the dam safety cost sharing. If no current
agreement addresses this cost, the sponsor may elect to repay the
cost, with interest, over a period of 30 years.
6-19. Correction of Design or Construction Deficiencies. Proposals
for correction of design or construction deficiencies evident in
completed Corps projects will be cost shared as follows:
a. A reconnaissance-type initial appraisal and report will be
made at full Federal expense. This reconnaissance report will serve
as the decision document.
b. If a proposal for corrective measures is made and adopted,
involving cost sharing, a PCA to cover the cost sharing requirements
shall be executed prior to accomplishment of further work on the
adopted project. Consistent with this guidance, the PCA shall provide
that:
6-15
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