Army Corps of Engineers: Budgetary History and Projections

The Army Corps of Engineers participates in the development and management of the nation’s water resources. The Corps has three main objectives:

• Supporting commercial navigation by maintaining and regulating commercial ports and waterways,
• Protecting the environment by preserving and restoring aquatic ecosystems, and
• Building and maintaining flood control projects.

Every two years since 2014, lawmakers have enacted the Water Resources Development Act (WRDA), which authorizes new construction and rehabilitation projects and directs the Corps to study the feasibility of future projects. (The most recent, the Water Resources Development Act of 2020, was enacted on December 27, 2020, as division AA of the Consolidated Appropriations Act, 2021, Public Law 116-260.) That authorization legislation, which establishes priorities for the Corps, is one of two types of legislation that specifically address the Corps’ activities; the other is appropriation bills, which provide most of the funds to carry out those activities.

How Are the Corps’ Activities Funded?

Annual discretionary appropriations provide most of the Corps’ funding. Over the 1992–2021 period, about 70 percent was provided through such appropriations. An additional 25 percent was provided in supplemental appropriations—generally for responding to disasters—and the last 5 percent was from mandatory sources that are available without annual appropriation action.

In 2021, the most recent year for which the Congressional Budget Office has complete data on the Corps’ funding, the agency received about $7.5 billion in discretionary funding and used about $550 million in mandatory funding to carry out its activities. The mandatory spending portion was offset by receipts that the Corps is authorized to collect.1 Those offsetting receipts, which are recorded in the budget as negative spending, totaled about $800 million in 2021.

The Corps has 11 discretionary budget accounts. Two of those draw on resources from trust funds: the Harbor Maintenance Trust Fund and the Inland Waterways Trust Fund. Like spending from the Corps’ other discretionary accounts, spending from the trust funds is subject to appropriation. But unlike the appropriations for those other accounts, which draw on the Treasury’s general fund, amounts appropriated for the trust fund accounts draw on tax receipts and interest credited to the trust funds. Historically, appropriated amounts have not been tied to annual amounts deposited into the trust funds but are limited by their balances. In 2021, for example, $2.1 billion of the Corps’ $7.5 billion in discretionary appropriations came from the trust funds; receipts credited to the trust funds in 2021 totaled $1.7 billion.2 (For further discussion of the trust funds, see Box 1.)

When hurricanes and other natural disasters occur, lawmakers usually provide supplemental funding to mitigate their effects.3 Nearly all those supplemental amounts have been appropriated since 2005, in the aftermath of Hurricanes Katrina, Rita, and Wilma and subsequent hurricanes (see Figure 1). Over the 2005–2021 period, the Corps’ total appropriations averaged $8.8 billion a year (equivalent to $10.7 billion a year in 2022 dollars). Of that amount, about 35 percent was provided in supplemental appropriations. By comparison, over the 1992–2004 period, total appropriations averaged $4.0 billion a year (equivalent to $6.5 billion a year in 2022 dollars), 3 percent of which was provided in supplemental appropriations.

Figure 1.

Appropriations to Major Accounts of the Army Corps of Engineers That Receive Supplemental Funding for Disaster Response

Billions of 2022 Dollars

The Congress provided supplemental appropriations for recovery efforts after Hurricanes Katrina, Rita, and Wilma and has done so for other major storms in the years since.

Notes

Data sources: Army Corps of Engineers; Congressional Budget Office. See www.cbo.gov/publication/58415#data.

The Corps’ major accounts are construction, operation and maintenance, Mississippi River and tributaries, and flood control and coastal emergencies.

The amounts provided in annual discretionary appropriations have grown gradually over time but otherwise do not vary much from year to year. Supplemental appropriations, by contrast, have varied widely from year to year and across accounts, because the regions affected by disasters and the severity of disasters vary (see Table 1).

Generally, the funding provided to the Corps in annual and supplemental appropriations does not expire but is available for intended purposes until it is spent.

How Are the Corps’ Appropriations Allocated?

Four major accounts receive and expend roughly 70 percent of the agency’s annual appropriations and 99 percent of its supplemental appropriations.

• The construction account received annual appropriations averaging $2.2 billion (in 2022 dollars) over the 1992–2021 period to construct projects in the nation’s rivers, harbors, and coasts to reduce floods, protect shorelines, and restore aquatic ecosystems. Such projects include the expansion of the Houston Ship Channel, construction of Louisiana’s levee and floodwall system, and Florida’s Everglades Restoration Project. The largest supplemental appropriation during that period totaled $16 billion. It was provided in 2018, mostly to assist Puerto Rico and the U.S. Virgin Islands in the aftermath of several hurricanes, to repair damage to existing Corps infrastructure caused by natural disasters, and to construct projects to mitigate future damage.
• The operation and maintenance (O&M) account received annual appropriations averaging $2.1 billion (in 2022 dollars) over the 1992–2021 period to operate and maintain existing federal infrastructure within the nation’s rivers and harbors. The largest supplemental appropriation for responding to natural disasters totaled $908 million and was provided in 2019. An even larger supplemental appropriation of $2.1 billion was provided for O&M in 2009, not for responding to natural disasters but to stimulate the economy during the 2007–2009 recession.
• The Mississippi River and tributaries account received annual appropriations averaging $460 million (in 2022 dollars) over the 1992–2021 period for projects to mitigate the risks of flooding along the Mississippi River’s Alluvial Valley south of Cape Girardeau, Missouri. The two largest supplemental appropriations during that period were each around $800 million. They were provided in 2012 to respond to severe flooding in several states along the Mississippi River and in 2018 after Hurricane Harvey.
• The flood control and coastal emergencies (FCCE) account received annual appropriations averaging $32 million (in 2022 dollars) over the 1992–2021 period to prepare for hurricanes, storms, and other natural disasters likely to cause damage from flooding. Annual appropriations for that account are small compared with the Corps’ other accounts because it receives most of its funding through supplemental appropriations for disaster response. In 2006, the FCCE account received supplemental appropriations that totaled more than $5 billion after Hurricanes Katrina, Rita, and Wilma. That was the largest amount appropriated to the FCCE account over the period.

The Corps’ seven other accounts that receive annual appropriations are for expenses of the Office of the Assistant Secretary of the Army for Civil Works, general administrative expenses, harbor maintenance, an infrastructure loan program, inland waterways projects, investigation of the economic and environmental feasibility of future projects, and regulatory enforcement. In total, those accounts received annual appropriations averaging $1.9 billion (in 2022 dollars) over the 1992–2021 period. A growing share of those appropriations has been derived from the Harbor Maintenance Trust Fund (more than 70 percent in the past few years) for operating and maintaining the nation’s waterways, harbors, and ports.4

How Has the Corps’ Spending Varied Over Time?

On average, spending (labeled in the budget as outlays) from the Corps’ four main accounts has been higher since 2004 than it was before then (see Figure 2). Between 1992 and 2004 (the period before Hurricanes Katrina, Rita, and Wilma), annual outlays averaged $4.9 billion (in 2022 dollars). After those three hurricanes, the federal government responded with significant supplemental appropriations for disaster assistance through the Corps and other agencies and continued to do so in response to subsequent major storms. From 2005 to 2021, average outlays from those four accounts were higher, at about $6.4 billion a year (in 2022 dollars). Over the entire 30-year period, annual spending averaged $5.7 billion (in 2022 dollars).

Figure 2.

Outlays From Major Accounts of the Army Corps of Engineers

Billions of 2022 Dollars

Outlays were boosted sharply by large supplemental appropriations in 2006, 2008, and 2009.

Notes

Data sources: Army Corps of Engineers; Congressional Budget Office. See www.cbo.gov/publication/58415#data.

The Corps’ major accounts are construction, operation and maintenance, Mississippi River and tributaries, and flood control and coastal emergencies.

How Does CBO’s Baseline Account for That Spending?

CBO’s baseline is not intended to be a forecast of budgetary outcomes; rather, it is meant to provide a benchmark that policymakers can use to assess the potential effects of policy decisions. CBO constructs its baseline in accordance with provisions of the Balanced Budget and Emergency Deficit Control Act of 1985 (P.L. 99-177) and the Congressional Budget and Impoundment Control Act of 1974 (P.L. 93-344).

As required by section 257 of the Deficit Control Act, the baseline projections that CBO prepares for discretionary appropriations, including those provided to the Corps’ 11 accounts, start with the current-law discretionary appropriation and then adjust annual funding over the following 10 years to account for anticipated inflation.5 In fiscal year 2022, lawmakers appropriated a total of $13.8 billion for the Corps’ activities; $10.9 billion of that amount was provided for the agency’s four major accounts. In its most recent baseline projections (from May 2022), CBO increased those 2022 appropriated amounts for inflation in each year over the 2023–2032 period. In total, funding is projected to reach $17.9 billion in 2032 (including $14.2 billion for the four major accounts).6

One consequence of the rules for constructing baseline projections is that the baseline is not a projection of how climate change might affect spending from the Corps. Climate change affects the Corps’ baseline only to the extent that it affects the amount of money that lawmakers choose to appropriate under current law. Such amounts can vary widely from year to year. 7

To estimate the Corps’ spending of annual appropriations, CBO uses historical data and information about the agency’s projects, accounting for the size of active and proposed projects and the anticipated schedules for completing them. In general, amounts provided for construction projects are estimated to take more than five years to be spent, on average, compared with amounts provided for operating and maintaining the Corps’ existing projects, which are estimated to be spent over two years, on average.

CBO analyzes the Corps’ spending of supplemental appropriations separately. That is because those amounts tend to be substantially larger (sometimes accounting for multiples of annual appropriations) and because they generally have a narrower, more urgent purpose.

How Quickly Does the Corps Spend Money Provided After Disasters?

Historically, the Corps has not reported its spending in response to disasters separately from its spending of annual appropriations. Under the Disaster Relief Appropriations Act, 2013 (P.L. 113-2), however, lawmakers required the agency to make such information publicly available for spending in response to Hurricane Sandy.8 Because of that requirement, CBO was able to separate information about the spending of supplemental appropriations for Hurricane Sandy from that for the spending of annual appropriations for each account. CBO has nine years’ worth of data on recovery spending from Hurricane Sandy, covering the 2013–2021 period.

Generally, the pace of spending for Hurricane Sandy has varied among the Corps’ accounts (see Figure 3). Spending for flood control ramped up quickly and then plateaued. For O&M, spending increased steadily and then slowed. And construction spending began slowly—about 40 percent of appropriated amounts were spent through 2021—but CBO expects that spending to continue for many years. Because use of the FCCE and O&M accounts had diminished by 2017, in 2018 the Congress transferred unspent amounts of $519 million from the FCCE account and $210 million from the O&M account to the construction account for projects to mitigate future damage.

Figure 3.

Cumulative Outlays as a Share of Amounts Appropriated to Major Accounts of the Army Corps of Engineers for Hurricane Sandy Recovery

Percent

Most of the spending in recent years for Hurricane Sandy recovery has been used for construction projects.

Notes

Data sources: Army Corps of Engineers; Congressional Budget Office. See www.cbo.gov/publication/58415#data.

Because the states affected by Hurricane Sandy are in the Northeast, the Congress did not provide supplemental appropriations to the Mississippi River and tributaries account for recovery from that disaster.

FCCE = flood control and coastal emergencies; O&M = operation and maintenance.

Through 2021, about $1.9 billion of the funding provided for construction in response to Hurricane Sandy remained unspent (of which $1.8 billion remained unobligated). That total does not include the $729 million transferred from the O&M and FCCE accounts in 2018. In CBO’s estimation, spending for construction will continue to grow before flattening, leaving some funding unspent at the end of the decade.

How Does CBO Estimate the Duration of Spending?

When estimating the duration of spending for a particular disaster, CBO considers the patterns of spending following earlier disasters of similar size and scope. The detailed data on recovery spending for Hurricane Sandy are a major source of information that has guided CBO’s estimates of how quickly funds will be spent to respond to other disasters. That pattern suggests that addressing immediate flood control and operational challenges related to the Corps’ existing projects occurs in the first few years after a disaster. Spending to address longer-term solutions that require the Corps to construct projects occurs later, after research and design are complete.

Why Does Projected Spending for the Corps Differ in CBO’s Baseline and Cost Estimates?

One of CBO’s responsibilities is to estimate the effects that authorizing legislation would have on federal spending. When preparing cost estimates for legislation that authorizes funding for the Corps’ programs—or any other discretionary program—CBO estimates the potential changes in discretionary spending that would result if the legislation was enacted and if future appropriations were provided consistent with the legislation’s provisions. Those estimates are measured relative to current law (that is, existing appropriations for one year, with no future appropriations assumed). They are not measured relative to CBO’s baseline projections, which incorporate an assumption about future appropriations (namely, that appropriations grow with inflation) and their spending over time.