Detailed Information on the
Bureau of Reclamation - Water Management - Project Planning and Construction Assessment

Develop a comprehensive, long-term strategy to operate, maintain, and rehabilitate Reclamation facilities.

Improve the linkage between program performance and program budget requests.

Develop baseline data and establish annual and long-term targets for the program efficiency measure.

Institute a database to help track project planning processes.

Address findings of a recent National Research Council study indicating the program needs stronger oversight of project planning and development.

Identify project(s) for demonstrating linkage between performance and budget request.

Measure: Acre-feet of New Storage

Explanation:This measure presents the acre-feet of new storage that is provided as a result of project construction. Targets and actual accomplishement are based on those projects that are either substantially completed or have portions (storage features) that are substantially completed. It is recognized that there may be several years of "zero" shown for targets and "zero" shown for actual performance because construction programs are generally multi-year. The measure is an element of GPRA data that is being reported under "Resource Use-Water - Complete construction projects -- water availability."

Measure: CFS-Miles of Conveyance Systems Constructed

Explanation:Measure relates to a signficant element of Reclamation's construction program and is intended to complement the CFS miles completed measure by showing progress made twoard completion. The measure does not require the entire system to be completed and operational. Instead, the definition of construction would consider (a) pipe to be buried in any year or (b) canals/laterals that will be excavated and lined.

Measure: CFS-Miles of Conveyance Systems Completed

Explanation:This measure relates to a signficant element of Reclamation's construction program. Actual vs forecasted will be reported. This measure integrates both the size of conveyance and distribution systems with the size (cubic feet per second) that is provided as a result of project construction. Targets and actual accomplishment would be based on those projects that are either substantially complete or have portions that are substantially completed. It is recognized that there may be several years of "zero" shown for targets and "zero" shown for actual performance because construction years are generally multi-year. This measure is complemented by the CFS-Miles Constructed measure which is designed to show interim progress.

Measure: Percent of construction projects with cost and schedule variances of less than 10% of the approved project plan

Explanation:A key indicator that a construction project is going as planned is the variances of both cost and schedule from the approved plan or Earned Value. Performance measurement requires monitoring and reporting on project cost and schedule status, with assessment against planned progress across all projects within the program. Reclamation proposes that 90% of its project activities as measured by the Cost Performance Index (CPI) and Schedule Performance Index (SPI) meet or exceed the efficiency measure. This allows for some variance due to unanticipated or external factors. Using this Earned Value metric provides an objective measure of how much work has been completed on a project against the baseline of the amount of work planned to be accomplished.

Is the program purpose clear?

Explanation: The Water Management/ Supply-Construction program supports Reclamation's mission by planning and constructing water supply storage facilities and conveyance systems. These projects provide service for agricultural and municipal and industrial uses, in those project areas where a federal role has been defined through planning studies, Departmental and OMB reviews, and congressional and administration action.

Evidence: Reclamation Act of 1902 and supplemental authorizations (both Reclamation-wide and project specific)

Does the program address a specific and existing problem, interest, or need?

Explanation: The program addresses a need for continued reliable water supplies in the Western United States to support existing economies, sustain production of agriculture, provide water for municipal and industrial purposes, and where consistent with other project purposes, flood control.

Evidence: The existing problems are evident with the rapid population growth and areas of the West where water is already scarce; frequent drought and water shortages are experienced; and there are increasing conflicts over limited supplies. Additional data provided at http://www.doi.gov/water2025/.

Is the program designed so that it is not redundant or duplicative of any other Federal, state, local or private effort?

Explanation: The construction program of the Bureau of Reclamation is unique in its mission, the types of projects that it develops and the relationships with the project beneficiaries that it must maintain. Beginning in 1902, Congress directed Reclamation to plan and construct water resource development projects in the 17 Western States. In 1983, the Economic and Environmental Principles and Guidelines for Water and Related Land Resources, Water and Related Land Resources Implementation Studies (P&Gs) were established to ensure that Federal water resources development projects were comprehensively and consistently planned and evaluated. Reclamation, like the Corps of Engineers has adhered to those standards in their respective construction planning efforts. As such, the planning and development of water resources development projects are, by design, intended to address the same engineering, economic, environmental, social etc. sets of criteria. Therefore, this is no longer the exclusive expertise of Reclamation. However, Reclamation's construction program has shifted to focus on serving Native American communities who are not served by other Federal, State, local entities or the private sector. As such, the scope, programmatic missions and areas of planning and construction are exclusive to Reclamation. In addition to the fact that the Army Corps of Engineers focuses on navigation and flood control and Reclamation focuses on providing water for irrigation and municipal and industrial purposes, Reclamation meets the water resources construction needs of an un-served population in the United States that is not addressed by any other Federal, State or Local entity. A significant portion (5 of 7) of the projects under Reclamation's Planning and Construction Program that are under review by the Construction PART - are singular, non-traditional water resource development projects - intended to meet the specific requirements of Indian water right settlements. They are negotiated by Tribal entities and the Secretary of the Interior, who has a unique Trust relationship with the Tribes. Further, since most of the construction contracts for those Indian related projects are developed under P.L. 93-638, the Indian Self Determination and Education Assistance Act (638), Reclamation has a unique set of requirements and guidelines for the development, negotiation and oversight of construction of construction contracts under that program.

Evidence: Economic and Environmental Principles and Guidelines for Water and Related Land Resources, Water and Related Land Reosurces Implementation Studies (P&Gs), 1902 Act and Acts suplemental thereto, list and description of projects of coverd under Planning and Construction PART.

Is the program design free of major flaws that would limit the program's effectiveness or efficiency?

Explanation: Reclamation has undertaken several initiatives since 2004 to address potential flaws or problems with this Program. First, Reclamation contracted with the National Academy of Sciences, through its National Research Council (NRC) to provide an analysis and make recommendations on "the appropriate organizational, management, and resource configuration to meet its construction, maintenance and infrastructure requirement for its missions of the 21st Century." As a result of this report, Reclamation undertook a major initiative entitled Managing for Excellence (M4E) whereby 41 Teams were established to analyze the NRC's recommendation and recommend specific actions in order to implement them as appropriate. One areas of the initiative is related to Project Management and includes expanding the use of comprehensive and structured project management processes. Project management Directives and Standards have been developed along with a training program for all personnel with project management responsibilities. Other project management program activities under the M4E initiative are related to the effectiveness of training and development programs. Training is provided in developing collaborative competencies for construction and for project managers to successfully negotiate and work cooperatively and collaboratively with stakeholders, project beneficiaries and contractors. This is necessary in order to ensure that construction and other projects are completed efficiently, within budget and on time. Second, Reclamation conducted an independent review of the Animas LaPlata project and the issues associated with that project's cost estimates. It also completed a review of the direction of Reclamation construction program under this PART review which found that it is evolving with a greater focus on the design and construction of facilities to meet the requirements of Indian water right settlements. In both cases, Reclamation found that it did not have the skills and expertise across the agency to effectively and consistently negotiate and administer construction contracts with Tribes and tribal organizations under P.L. 93-638, the Indian Self Determination and Education Assistance Act (638). In response, Reclamation developed and has delivered a comprehensive training program to Reclamation's project managers - particularly those where 638 contracts are involved -- on the management and negotiations of contracts and agreements with Tribes. Reclamation recognized that because of the number of 638 contracts that must be developed in Reclamation's construction program, and our expectation of their increasing importance in the future, developing an expertise in this area is crucial for ensuring that Reclamation's construction program is cost effective and efficient. Third, Reclamation has established the Design, Estimating and Construction Oversight office (DEC), to provide Reclamation, and our customers and stakeholders with an independent analysis of design and construction estimates to ensure that they are properly prepared, reasonable and appropriate. Further, the DEC office has issued draft directives and standards to guide this activity in a clear and consistent manner.

Evidence: NRC Report, M4E Action Plan & Project Management Decision documents, Project management training course description and agenda, 638 training class description, agenda and course materials, DEC Directive and Standard.

Is the program design effectively targeted so that resources will address the program's purpose directly and will reach intended beneficiaries?

Explanation: With respect to the project planning and construction program, there is evidence that project benefits do in fact reach project beneficiaries: completing planning or construction is in this case synonymous with delivering benefits. Project benefits and beneficiaries are clearly outlined in planning documents that are presented in support of authorizing legislation. A key element of a feasibility study is to determine the beneficial use (unmet needs), evaluate data on resource demands and potential uses of water, and develop a gap analysis or needs assessment for specific project purposes and beneficiaries. Contracts and operating agreements also ensure that benefits are targeted to the appropriate audience; this latter issue will be addressed more fully in the PART on project Operations and Maintenance.

Evidence: Project beneficiaries, purposes, and service areas are identified during the planning process and are approved as part of the authorization process. This work is accomplished in accordance with the "Economic and Environmental Principles and Guidelines for Water and Related Land Resources Implementation Studies." These activities and legislative language prescribe the receipients of all project benefits. Contracts for repayment and water delivery provide further assurance that the resources are targeted at the intended beneficiaries.

Does the program have a limited number of specific long-term performance measures that focus on outcomes and meaningfully reflect the purpose of the program?

Explanation: Reclamation and OMB have reached agreement on a specific set of long-term performance measures that reflect, in an appropriate and meaningful way, the objectives of Reclamation's construction program. Furthermore, for several of these measures, Reclamation has been collecting data and reporting the results in our FY 2006, FY 2007 and FY 2008 budget justification materials submitted to OMB and to Congress. The first measure gauges "acre-feet of new storage" contributes to an existing GPRA goal in the strategic plan (SP). In addition to measuring construction, Reclamation now presents all of the individual components that comprise the measure, i.e., rural water, Title XVI, O&M, non-reservoir construction, and reservoir construction (PART) projects, as requested by OMB. That way, comparisons can be made between the existing GPRA and the specific portion resulting for construction that is represented through this PART. This information is depicted for the the short and long term in Reclamation's Budget Justifications. The second long term measure is to monitor CFS miles of distribution and conveyance facilities- completed. A large percentage of Reclamation's construction program is focused on the construction of distribution and conveyance facilities. The measure captures Reclamation's efficiency and effectiveness for this crucial activity. Reclamation has been tracking the performance of this aspect of the program for some time and reported data in the FY 2006, 2007 and 2008 Budget Justifications. Additionally, Reclamation will be monitoring the overall efficiency of the construction program through a measure which will gauge its earned value by measuring the percent of construction projects with negative cost and schedule variances. In other words, Reclamation is measuring its efficiency by tracking its ability to adhere to construction schedules and budgets, both subject to appropriations. To do that, Reclamation has proposed a 90% target associated with this measure which allows for some variance due to unanticipated or external factors. Using this Earned Value metric provides an objective measure of how much work has been completed on a project against the baseline of the amount of work planned to be accomplished.

Evidence: Measures and data from budget justification(s), sample L-29 report

Does the program have ambitious targets and timeframes for its long-term measures?

Explanation: Reclamation and OMB have reached agreement on a specific set of long-term performance measures that reflect, in an appropriate and meaningful way, the purpose of Reclamation's construction program. The long term targets established for these measures are ambitious and will press and challenge Reclamation and its contractors and customers to reach them. For example, the long term target for the CFS-Miles of distribution and conveyance completed measure is 10,250. However, the 2004 Actual was 349, which is less than 5 percent of the long term goal. This Measure is intended to gauge the completion of the construction of water conveyance facilities. Because of the nature of constructing such facilities, where in a given project canals and pipelines are constructed and while portions are completed, the entire system is not for a number of years. As such, the interim reporting on this Measure may be a smaller percentage of completion. However, as all the phases are constructed and the project is closer to completion, the percentages of "completion" rise. In the long-term, over the course of the several years that it takes to construct a conveyance system, Reclamation is expecting to meet the ambitious long term goals set by the measure.

Evidence: Data from budget justification, spreadsheet on construction of conveyance and distribution systems to show peaks and troughs of the construction process. Given the recent establishment of the Earned Value performance measure, there is a lack of baseline data. Two other performance measures - CFS-mils of conveyance completed and acre-feet of new storage - show zero targets and zero actual performance recorded in FY 2006. Although these two measures will likely have years of "zero performance" because they are multi-year measures, the nascence of these measures precludes this answer from receiving a "yes".

Does the program have a limited number of specific annual performance measures that can demonstrate progress toward achieving the program's long-term goals?

Explanation: In addition to the long term goals agreed upon by OMB and Reclamation, there are short term goals as well. For example, one of Reclamation's long term measures is "cfs-miles completed." It is a measure of the miles of distribution and conveyance facilities that are completed when the project is completed. The corresponding short term measure is CFS-miles constructed, since in most cases, while pipeline or canal construction proceeds, it may take several years for the entire pipeline or canal to be built or be completed. As a short term or interim measure, the CFS miles constructed - measures the amount of progress in a given year or time period toward the long-term measure. Reclamation's efficiency measure, "percent of construction projects with negative cost and schedule variances of less than 10% of the approved project plan" also provides valuable information in helping to determine its interim progress toward its long term goals. A key indicator that a construction project is going as planned is the variances of both cost and schedule from the approved plan or Earned Value. This performance measure reflects monitoring and reporting on project cost and schedule status, with assessment against planned progress across all projects within the program. Reclamation proposes a 90% target associated with this measure which allows for some variance due to unanticipated or external factors. Using this Earned Value metric provides an objective measure of how much work has been completed on a project against the baseline of the amount of work planned to be accomplished.

Evidence: Spreadsheet depicting construction process and progress of conveyance and distribution systems to depict peaks and troughs (long and short term)

Does the program have baselines and ambitious targets for its annual measures?

Explanation: Reclamation has developed baselines against which to guage its progress toward the annual measures. Baselines have been approved for all 4 of its performance measures and Reclamation has been reporting data on two of the measures since FY 2005 in its annual budget submittals for FY 2006, FY 2007 and FY 2008. Specific annual targets have now been quantified for all measures. The targets provide specific values with which performance can be compared. Targets are included for two years beyond the current PART year. While it is believed that the targets are set within reason for the program to achieve, they are also considered to be ambitious. In particular, the measure developed to guage the earned value of the construction program, "percent of construction projects with negative cost and schedule variances of less than 10% of the approved project plan" is considered to have an ambitious target. Reclamation proposes a 90% target associated with this measure which allows for some variance due to unanticipated or external factors. Using this Earned Value metric provides an objective measure of how much work has been completed on a project against the baseline of the amount of work planned to be accomplished.

Evidence: PARTWeb and MITS performance measurement systems. Given the recent establishment of the Earned Value performance measure, there is a lack of baseline data. Two other performance measures - CFS-mils of conveyance completed and acre-feet of new storage - show zero targets and zero actual performance recorded in FY 2006. Although these two measures will likely have years of "zero performance" because they are multi-year measures, the nascence of these measures precludes this answer from receiving a "yes".

Do all partners (including grantees, sub-grantees, contractors, cost-sharing partners, and other government partners) commit to and work toward the annual and/or long-term goals of the program?

Explanation: The measures established for Reclamation's construction program, by the nature of the activity, are met on a project-by-project basis. Given that Reclamation's construction projects are each distinct in the way they are authorized, funded, and contracted, the project partners (including contractors and project beneficiaries) tend to focus solely on their project. Because of this project-by-project focus, the project partners do not concentrate on the long term or annual goals of Reclamation's overall construction program. Rather, they care about meeting the programmatic goals as they relate to the specific project. The burden of oversight and ensuring that the annual and long term goals of the construction program are met and/or exceeded, then, falls on Reclamation. Reclamation has undertaken a number of significant activities to ensure that the Project partners have significant incentives to be committed to working for and meeting or exceeding the goals of the Program. First, Reclamation works closely with its contractors, project beneficiaries and Federal and non-Federal partners to meet the annual and long term goals of the program. Non-Tribal project beneficiaries, depending upon the specific legislative authorization, have a financial obligation in the construction of the project -whether that be as an up front cost share or as a contractual repayment obligation. Additionally, all project beneficiaries have a stake in getting the project completed in a timely manner in order to begin realizing the benefits of the water deliveries to their customers or constituents. As such, they have a major stake in the projects being completed in a timely, efficient and cost effective manner. This directly tracks to Reclamation's efficiency measures as well as its long and short term performance measures. In many cases, Reclamation, and its construction partners (including contractors, customers and Federal partners) have clearly defined processes for communications and reporting of progress toward meeting the goals of the project. For example, on a bi-monthly basis the beneficiaries, customers, contractors and Federal partners of the Animas LaPlata project meet to receive updates and other reports on the status of construction. This provides significant incentive for Reclamation and its contractors to keep on schedule and within the budgets developed. Reclamation's construction contracts are written to focus on completing the work on or under budget and on schedule. Reclamation structures its construction contracts with intermediate flag dates to ensure that the construction project is moving along, and any problems or potential delays can be addressed. Further, most contracts include liquidated damages clauses if we can demonstrate and calculate financial burdens incurred by Reclamation or our stakeholders due to late completion of a project or project feature. These penalties would take the form of a cost per day of delay in completing construction. This provides a significant incentive for contractors to meet Reclamation's measures - particularly the earned value efficiency measures. Reclamation also includes a clause in our contracts which allow the contractor to propose different means of providing the project deliverables (e.g. if he/she proposes to build a short pipeline that will deliver the same amount of water as a long canal which was in the contract at a substantial cost savings). In those cases, Reclamation pays the contractor for the less expensive project components plus a half of the savings. This process is called a "Value Engineering Change Proposal" and included in nearly all of our construction contracts.

Evidence: Sample Reclamation Project authorizations (to depict unqiue and individual nature of Projects); Sample Repayment contracts (to depict beneficiairies financial stake); Notes from Animas LaPlata bi-monthly meeting (to depict communication process); sample construction contract (to depict contractor accountability on cost and schedule)

Are independent evaluations of sufficient scope and quality conducted on a regular basis or as needed to support program improvements and evaluate effectiveness and relevance to the problem, interest, or need?

Explanation: Reclamation has undertaken several initiatives since 2004 to carry out various levels of independent review to support program improvements evaluate effectiveness and make long and short term adjustments to address any issues or problems that are identified. First, Reclamation contracted with the National Academy of Sciences, through its National Research Council (NRC) to provide an analysis and make recommendations on "the appropriate organizational, management, and resource configuration to meet its construction, maintenance and infrastructure requirement for its missions of the 21st Century." As a result of this report, Reclamation undertook a major initiative entitled Managing for Excellence (M4E) whereby 41 Teams were established to analyze the NRC's recommendations and recommend specific actions in order to implement those recommendations as appropriate. One major area relates to Project Management, which includes expanding the use of comprehensive and structured project management processes. Project management Directives and Standards have been developed along with a training program for all personnel with project management responsibilities. Other project management program activities under the M4E initiative are related to the effectiveness of training and development programs, training in collaborative competencies for construction and other project managers to successfully negotiate and work cooperatively and collaboratively with stakeholders, project beneficiaries and contractors to ensure that construction and other projects are completed efficiently, within budget and on time. Second,at the Secretary's request, the Department completed an independent review of the Animas LaPlata project, and the issues associated with the Project's cost estimates. This review used outside consultants along with contracting and construction experts within the Department and Reclamation (none of whom had any involvement in the ALP project) to undertake a comprehensive, critical and objective review of what happened. In so doing, the reviewers made significant recommendations to fundamentally change some of Reclamation's practices as it relates to cost estimating, contracting and construction oversight. As a result, the independent design estimating and construction office (DEC) office was created and a new set of processes and training were established to address contracting with tribes under P.L. 93-638, the Indian Self Determination and Education Assistance Act (638). Since that time, Reclamation developed and delivered a comprehensive training program to the project managers - particularly those where 638 contracts are involved -- on the management and negotiations of contracts and agreements with Tribes. Reclamation recognized that because of the number of 638 contracts that must be developed in Reclamation's construction program, and our expectation of their increasing importance in the future, developing an expertise in this area is crucial for ensuring that Reclamation's construction program is cost effective and efficient. Both the NAS study and the ALP review have only recently been completed and implementation of NAS recommendations through the Managing for Excellence initiative is underway. Reclamation anticipates that it will seek a follow up review to provide an assessment of the progress that has been made as a result.

Evidence: NRC Report & Sample M4E decision memo (to depict NRC recommendations and Reclamation response); Animas LaPlata review; 638 training agenda and course materials and list of class held;

Are Budget requests explicitly tied to accomplishment of the annual and long-term performance goals, and are the resource needs presented in a complete and transparent manner in the program's budget?

Explanation: Some of the performance measures are directly linked to Reclamation's Strategic Plan. As such, since FY 2006 Reclamation's regions and office are tying the budget requests for construction projects to the strategic plan outcomes and strategies. With the establishment of the efficiency measures, which will gauge the earned value of Reclamation's construction program by measuring the percent of construction projects with negative cost and schedule variances, Reclamation will have another strong tool to link performance and the program's goals to the budget in a transparent manner.

Evidence: There is no clear linkage between budget requests and performance. While Reclamation has been developing tools that will better link performance to goals in annual budget requests, this process has not yet progressed to an adequate level.

Has the program taken meaningful steps to correct its strategic planning deficiencies?

Explanation: Reclamation has undertaken several initiatives since 2004 to address potential flaws with this effort. First, Reclamation contracted with the National Research Council (NRC) to provide an analysis and make recommendations on "the appropriate organizational, management, and resource configuration to meet its construction, maintenance and infrastructure requirement for its missions of the 21st Century." As a result, Reclamation undertook an initiative entitled Managing for Excellence (M4E) to analyze the NRC's recommendations and then recommend specific actions to implement them as appropriate. One major area relates to Project Management, which includes expanding the use of comprehensive and structured project management processes. Project management Directives and Standards have been developed along with a training program for all personnel with project management responsibilities. Other project management program activities under the M4E initiative are related to the effectiveness of training and development programs, training in collaborative competencies for construction and other project managers to successfully negotiate and work cooperatively and collaboratively with stakeholders, project beneficiaries and contractors. Second, Reclamation completed an independent review of the cost estimates of the Animas LaPlata project. Reclamation found that it did not have the skills and expertise across the agency to effectively and consistently negotiate and administer construction contracts with Tribes and tribal organizations under P.L. 93-638, (638). In response, Reclamation developed and has delivered a comprehensive training program to the project managers - particularly those where 638 contracts are involved -- on the management and negotiations of contracts and agreements with Tribes. Also, in response to the results of the ALP Project review, Reclamation has established the Design, Estimating and Construction Oversight office (DEC), to provide an independent analysis of design and construction estimates to ensure that they are properly prepared, reasonable and appropriate. Further, the DEC office has issued directives and standards to guide this activity in a clear and consistent manner. Finally, Reclamation established a specific set of performance measures that reflect, in an appropriate and meaningful way, the objectives of Reclamation's construction program. For several of these measures, Reclamation has been collecting data and reporting the results in our FY 2006, FY 2007 and FY 2008 budget justification materials submitted to OMB and to Congress. The first measure gauges "acre-feet of new storage" contributes to an existing GPRA goal in the strategic plan. The second long term measure is to monitor CFS miles of distribution and conveyance facilities- completed. A large percentage of Reclamation's construction program is focused on the construction of distribution and conveyance facilities. And, Reclamation will be monitoring the overall efficiency of the program by measuring its earned value (the percent of construction projects with negative cost and schedule variances). In other words, Reclamation is measuring its efficiency by tracking its ability to adhere to construction schedules and budgets, both subject to appropriations. To do that, Reclamation has proposed a 90% target associated with this measure which allows for some variance due to unanticipated or external factors.

Evidence: NRC report, M4E Action Plan; ALP investigation memo, DEC memo and D&S, 638 training materials.

Has the agency/program conducted a recent, meaningful, credible analysis of alternatives that includes trade-offs between cost, schedule, risk, and performance goals, and used the results to guide the resulting activity?

Explanation: Each proposed construction project must undergo an assessment of the Federal interest, alternatives and project cost estimates. peer review and value engineering are also used to ensure cost effectiveness. The results of these assessments guide recommendations for future actions on proposed construction projects. This process may not necessarily apply to Congressional write ins.

Evidence: In general, individual project reviews that take into account alternatives, trade-offs, cost, etc. are a normal part of planning, construction, and the authorization processes. This work is accomplished in accordance with the P&Gs (as mentioned in question 1.5). Reclamatoin recently analyzed the Animas La Plata project to determine the specific issues that affected that project's cost estimates. The results of that analyses were used to develop new procedures for the entire Water Management/Supply-Construction program. A report to the Secretary oulines many of the problems associated with ALP activities. DEC establishement memo, Value engineering annual report;

Does the agency regularly collect timely and credible performance information, including information from key program partners, and use it to manage the program and improve performance?

Explanation: Since 2004, Reclamation has collected performance data on its specific performance measures. This information in included in our reporting for the strategic plan; it is used to develop budget submittals and justifications; and is submitted to OMB and the Congress with Reclamation's budget justifications. In addition, on a monthly basis each of Reclamation's regional construction office produce a report, called the L-29, on the costs, schedules, and performance of each on-going construction contract. The construction manager and contracting officer (CO) for each individual construction contract use the cost, schedule, and performance data reflected in these L-29 reports as they evaluate how best to manage each contract. For example, if these data show the contractor is not meeting the contract's schedule targets or quality requirements, the CO may direct the contractor to adjust his/her procedures to improve quality and accelerate progress to meet schedule targets. If the contractor fails to comply, the CO has a range of measures he/she can use to compel the contractor to meet the contract requirements ranging from withholding progress payments to imposing liquidated damages to, in extreme cases, terminating the contract for non-performance. These L-29 reports are also used on a regional basis to evaluate the progress of its construction program - focusing on ensuring that the individual contractors and project partners continue to meet or exceed goals and improve performance and efficiency of the construction program as it relates to that Project. The cost and schedule performance data from these reports will be used to support Reclamation's Earned Value Management effort which, in turn, will be the basis for Reclamation's agency-wide Planning and Construction PART efficiency measure as outlined in Reclamation's Efficiency Measure Implementation Plan.

Evidence: performance data and 2008 budget justification; sample L-29 report

Are Federal managers and program partners (including grantees, sub-grantees, contractors, cost-sharing partners, and other government partners) held accountable for cost, schedule and performance results?

Explanation: Through the cost-sharing agreements, performance expectations and requirements are established for project sponsors and Reclamation. In construction contracts, there are provisions for damages when construction contractors miss scheduled deadlines. Funding can be withheld in extreme cases where performance is out of compliance with established project requirements. The incentives for project sponsors to meet requirements and schedules is that they are the primary recipient of projects benefits; however, local sponsors may try to avoid their shared responsibility and foist off any cost-increases on the taxpayers. For Reclamation staff, starting in FY 2003, each SES was required to include at least 1 GPRA goal and specific program/project objectives in their performance agreements, some of which may include construction projects. Reclamation will also include at least one GPRA goal or a related performance measure that ties to the strategic plan in every employee's performance agreement.

Evidence: Reclamation has increased efforts to ensure accountability in Construction program management. DEC process memo, 638 training materials, major changes in construction management responsibilities within Reclamation and realignment of the federal and sponsor Project Coordination teams. Individual employee performance agreements and annual performance evaluation processes are being revised to relate to GPRA. Cost-share and repayment agreements are established and monitored for compliance with the objectives of the project(s). Progress Reports are prepared to present information on % accomplishment and expenditures. Performance reports for each contract are done at the end of the construction contract. These specific project reports are considered by Reclamation staff, which has responsibility for project completion, and by project sponsors who share financial responsibilities.

Are funds (Federal and partners') obligated in a timely manner, spent for the intended purpose and accurately reported?

Explanation: 98% obligation rate for Reclamation overall. Reclamation reports actual expenditures and obligations in its annual reports. Some program expenditures may require modification during the fiscal year, and Reclamation has guidelines to follow to support reprogramming requests that exceed a certain threshold and require Congressional notification.

Evidence: Periodic and year-end spending reports (annual financial reports; http://www.usbr.gov/main/library); Sample L-29 report

Does the program have procedures (e.g. competitive sourcing/cost comparisons, IT improvements, appropriate incentives) to measure and achieve efficiencies and cost effectiveness in program execution?

Explanation: Planning processes require consideration of project costs and alternatives. Peer reviews, value engineering processes, maintenance of core design and construction staffing and capabilities, and A/E professional services also help ensure efficiencies and cost effectiveness. Performance ratings for key staff reflect requirements to meet GPRA goals for the program.

Evidence: P&G processes, Value engineering, A/E contracts, GPRA, Performance Plans for employees, PEER reviews, ALP construction cost tracking by Project Construction Engineer support this determination.

Does the program collaborate and coordinate effectively with related programs?

Explanation: Reclamation, through this program, collaborates with stakeholders, cost-sharing partners, the U.S. Army Corp of Engineers (Reclamation approves irrigation elements of Corps' projects; Corps approves flood control on Reclamaton projects), states, and individual water districts. Evidence: Federal Advisory Committee Act groups, and activities with Corps of Engineers, Central Valley Project, Central Arizona Project Indian Distribution Systems, are examples of coordination activities.

Evidence: Evidence: Federal Advisory Committee Act groups, and activities with Corps of Engineers, Central Valley Project, Central Arizona Project Indian Distribution Systems, are examples of coordination activities.

Does the program use strong financial management practices?

Explanation: The Federal Finance Accounting system is used to track expenditures against each project on a monthly basis, and more frequently when necessary. Tracking includes auditing categories of expenditures to ensure consistency with project intent. As appropriate, every contract has a financial plan supervised by the COTR and the Contracting Officer. The COTR certifies that the information is accurate and timely. The CFO assures that Reclamation systems meet all legal and financial requirements.

Evidence: Strong program financial management practices are fully documented in an Independent Auditors' Report on Reclamation's Financial Statements for FY 2006 and FY 2005 (February 12, 2007 Memorandum from the OIG to Reclamation). The Technical Services Center has a budget group that monitors spending. Various offices in Reclamation have Budget Staffs who monitor expenditures through the Federal Financial System.

Has the program taken meaningful steps to address its management deficiencies?

Explanation: Reclamation submits quarterly progress reports to DOI on the Animas La-Plata project. Also, new directives and standards are developed to address roles and responsibilities and the 638 processes. A "watch list" has been developed (as previously mentioned). Projects exceeding $10 million will be continually monitored by Reclamation staff. The list is for projects that are in addition to Animas La Plata. New DEC process with Directives and Standards are in place as well.

Evidence: Reclamation established Project Management Teams that use the Earned Value Analysis procedures to ensure design efficiencies. Reclamation implemented project specific reporting requirements for construction. Also, Reclamation redefined roles and responsibilities through development of: (a)Reclamation Policy-Design and Construction; (b) Reclamation Directive-Maintenance of Design and Construction Technical Capabilities; (c) Reclamation Directive-Construction Activities; and (d) Reclamation Policy-Cost Estimating, (e)DEC policies (D&S)

Is the program managed by maintaining clearly defined deliverables, capability/performance characteristics, and appropriate, credible cost and schedule goals?

Explanation: This is an area where Reclamation has undertaken several significant initiatives to improve its performance in this area. First, by completing a suite of measures and data that enables Reclamation to more clearly define and articulate its goals and manage the programmatic activities to meet those goals. One of the measures Reclamation has adopted directly relates to defining deliverables, monitoring and adhering to cost and schedule goals established for a specific construction project, "percent of construction projects with negative cost and schedule variances of less than 10% of the approved project plan." Throughout the construction industry, the primary indicator of success is to gauge the Earned Value of the project by measuring the status of an ongoing or completed project against the originally planned value or established budget plan and schedule. According to industry literature and discussions with consultants, who advise the construction industry on the development of performance matrices, earned value - using the schedule and cost variance -- is the most accurate, appropriate and commonly used metric for technical and construction projects in the private sector. Second, Reclamation has established the Design, Estimating and Construction Oversight office (DEC), to provide Reclamation, and our customers and stakeholders with an independent analysis of design and construction estimates to ensure that they areproperly prepared, reasonable and appropriate. Further, the DEC office has issued directives and standards to guide this activity in a clear and consistent manner. Third, Reclamation has, for several years, been a leader in the Department of the Interior and the Federal government in implementing an effective value engineering program, which evaluates the construction project designs in order to assess whether there are more cost effective and efficient means to complete a given project than is proposed. This program is measured by the amount of financial and programmatic savings it can realize.

Evidence: See measures and earned value implementation plan. See evidence for Q 1.4 for memo establishing DEC Office See Evidence for Q 1.4 for DEC directives and standards See Evidence for Q 1.4 for sample DEC report

Has the program demonstrated adequate progress in achieving its long-term performance goals?

Explanation: The Construction program is currently on track to meet the long-term performance goals it has established. Although the performance measures are relatively new, the program met its 2006 targets and is on track in meeting its long term targets. The "cfs miles" measure helps to monitor this progress toward long term accomplishment. Projects included in the "cfs miles" constructed measure include Ridges Basin Inlet Conduit, Navajo Nation Municipal Pipeline and Savid Rapids Dam project. Reclamation is on track for meeting its long term targets for each of these projects. In 2006, the Ridges Basin Inlet Conduit target of 101 cfs miles was met; the project is on track for meeting its 2007 target of 224 which is more ambitious. A 2008 target of 252 cfs miles is even more ambitious for the project. It is scheduled for completio in 2009. The Navaho Nation Municipal Pipeline is set for completion in 2012 with targeted performance of 36 cfs miles in 2009; 284 cfs miles in 2010 and 84 cfs miles in 2011. The Savage Rapids Dam project, including replacement of pumping facilities and dam removal, is also on track. Replacement of pumping facilities began in FY 2007. Removal of the dam begins in FY 2009 and is tentatively scheduled for completion in early 2010.

Evidence: Sample L-29 reports; sample construction contracts

Does the program (including program partners) achieve its annual performance goals?

Explanation: Reclamation has a long history of constructing its projects in a timely fashion and within budgets estimates established. Hoover Dam, for example was completed several years early and several million dollars under budget. However, in the past, Reclamation has not had a clear and concise measure to articulate and demonstrate this fact. With the establishment of the measures identified previously, Reclamation is able to quantify its success and progress in this area. The Construction program is currently on track to meet the long-term performance goals that have been identified in its budget documents. Since FY 2004, the "acre-feet of new storage" measure has exceeded its annual targets and is on track to meet its long term target. The FY 2004 target of 102,109 acre-feet of storage was exceeded by 1,489 acre-feet; FY 2005 target of 31,689 was exceeded by 20,031 acre-feet; and the FY 2006 target of 34,349 was exceeded by 13,390. Targets set for FY 2007 and FY 2008 are 24,839 and 94,932 respectively and it is anticipated that they will also be met. The "cfs miles of conveyance systems completed" measure exceeded its FY 2005 target of 15,526 cfs miles by 2,227 miles. The FY 2006 target of 14,103 cfs miles, however, fell short by 4,370 cfs miles. Targets set for FY 2007 and FY 2008 are 9,855 and 7,985 respectively. It is anticipated that they will be met.

Evidence:

Does the program demonstrate improved efficiencies or cost effectiveness in achieving program goals each year?

Explanation: Reclamation has developed and OMB has approved an efficiency measure that enables it to better monitor and report on its performance in this area. It now gauges the Earned Value of its construction program by measuring the "percent of construction projects with negative cost and schedule variances of less than 10% of the approved project plan." The measure is considered a best practice measure for Construction by OMB. Reclamation is in the process of gathering data to demonstrate potential efficiency improvements in the program. In addition, on a monthly basis each of Reclamation's regional construction office produce a report, called the L-29, on the costs and schedules of each on-going construction contract. Construction contractors and partners must provide these reports and the information as part of their contractual responsibility. This data is used to measure the effectiveness and efficiency of the progress of each construction project. Reclamation has a long history of constructing its projects in a timely fashion and within budgets estimates established. Hoover dam, for example was completed several years early and several million dollars under budget. However, in the past, Reclamation has not had a clear and concise measure to articulate and demonstrate this fact. With the establishment of the measures identified previously, Reclamation is able to quantify its success and progress in this area.

Evidence:

Does the performance of this program compare favorably to other programs, including government, private, etc., with similar purpose and goals?

Explanation: Comparisons would be extremely expensive and difficult on a program or project level due to significant variation in project and program size and scope of activities. Also, some program activities are focused on resolving issues that are interstate, sometimes international, and frequently characterized by conflict. Therefore, comparisons can only be made on an specific activity, labor rates, or in general terms regarding how Reclamation conducts its activities.

Evidence: Reclamation uses comparable labor rates and the latest technologies, standards, practices to ensure that it is compares favorably with activities that would be conducted by A/E firms, States, or other governmental agencies. These technologies include: electronic survey equipment and software, GIS, CADD, engineering and scheduling software, Construction Specification Institute, codes and standards, manufacturing and construction methods, contracting methods, claim and dispute resolution, and engineering registration requirements. They also encourage memberships in technical and professional societies and technical workshops to ensure that staff is familiar with new and effective construction technologies. Contracts are used to obtain A/E assistance when workload and schedules cannot be met using Reclamation staffing. Evaluation of these costs indicates that they are comparable to Reclamation costs for similiar level staff activities. Reclamation is proceeding with a contract with the National Research Council to benchmark certain contsruction activities and determine Reclamation program performance.

Do independent evaluations of sufficient scope and quality indicate that the program is effective and achieving results?

Explanation: Reclamation has undertaken several initiatives since 2004 to carry out various levels of independent review to support program improvements, evaluate effectiveness and make long and short term adjustments to address any issues or problems that are identified. First, Reclamation contracted with the National Academy of Sciences, through its National Research Council (NRC) to provide an analysis and make recommendations on "the appropriate organizational, management, and resource configuration to meet its construction, maintenance and infrastructure requirement for its missions of the 21st Century." As a result of this report, Reclamation undertook a major initiative entitled Managing for Excellence (M4E) whereby 41 Teams were established to analyze the NRC's recommendations and to recommend specific actions in order to implement those recommendations as appropriate. One major area relates to Project Management, which includes expanding the use of comprehensive and structured project management processes. Project management Directives and Standards have been developed along with a training program for all personnel with project management responsibilities. Other project management program activities under the M4E initiative are related to the effectiveness of training and development programs, training in collaborative competencies for construction and other project managers to successfully negotiate and work cooperatively and collaboratively with stakeholders, project beneficiaries and contractors to ensure that construction and other projects are completed efficiently, within budget and on time. Reclamation completed independent review of the Animas LaPlata project, and the issues associated with the Project's cost estimates. It also completed a review of the direction of Reclamation construction program under this PART review which found that it is evolving with a greater focus on the design and construction of facilities to meet the requirements of Indian water right settlements, Reclamation found that it did not have the skills and expertise across the agency to effectively and consistently negotiate and administer construction contracts with Tribes and tribal organizations under P.L. 93-638, the Indian Self Determination and Education Assistance Act (638). In response, Reclamation developed and has delivered a comprehensive training program to the project managers - particularly those where 638 contracts are involved -- on the management and negotiations of contracts and agreements with Tribes. Reclamation recognized that because of the number of 638 contracts that must be developed in Reclamation's construction program, and our expectation of their increasing importance in the future, developing an expertise in this area is crucial for ensuring that Reclamation's construction program is cost effective and efficient. In addition, Reclamation has established the Design, Estimating and Construction Oversight office (DEC), to provide Reclamation, and our customers and stakeholders with an independent analysis of design and construction estimates to ensure that they are properly prepared, reasonable and appropriate. Further, the DEC office has issued directives and standards to guide this activity in a clear and consistent manner.

Evidence:

Were program goals achieved within budgeted costs and established schedules?

Explanation: Reclamation has planned and constructed many water infrastructure projects throughout the American West, and has generally achieved its program goals. Reclamation projects are usually constructed in a timely fashion and within authorized construction cost ceilings. However, in the past, Reclamation has not had a clear and concise measure to articulate and demonstrate this fact. With the establishment of the measures identified previously, Reclamation is able to quantify its success and progress in this area.

Evidence: Project expenditures, goals, and schedules generally conform to authorizing legislation. However, this is misleading; if projects run up against their authorized ceiling, Congress generally amends the project authorization to increase the cost ceiling. Increases in fund requirements requires agreements with project sponsors who must repay their allocated project costs and new legislation to authorize project cost increases. Therefore, strict controls afforded by these processes help ensure that the programs are completed in a timely manner and within the approved funding.