FEBRUARY 4, 1998


Mr. Chairman, members of the subcommittee, thank you for the opportunity to appear here today to discuss the unfunded maintenance and construction needs of the National Park Service.

The National Park Service encompasses 376 units, which are situated on roughly 83 million acres. Within this treasured collection of natural, cultural and historical sites there are over 16,000 permanent structures, which require maintenance as contemporary public-use and work facilities or as historical components of the parks - in some cases, both. This inventory includes 11,000 public-use and administrative buildings, 4,800 units of employees' housing and over 1,500 major water and sewer systems. In addition to buildings and structural facilities, there are 8,000 miles of roadway, 1,500 bridges and tunnels, 260 dams and at least 12,700 miles of trails. This infrastructure benefits 275 million park visitors each year. It has been noted before that, of the land management agencies, the National Park Service maintains the largest inventory of built facilities - an inventory, which has been historically costly to build and remains costly to maintain.

The intent of my testimony today is to clarify what we mean by the term "maintenance and construction backlog". I want to review how our procedures for setting priorities and accomplishing our project work have been modified in response to congressional advice to the National Park Service. I also want to discuss in general terms, the criteria we use for selecting construction and maintenance projects that, over time, lessen the inventory of projects.

For several years, the National Park Service quantified its unfunded maintenance and construction inventory, including roads, by compiling a master list of projects, provided by park superintendents, which reflected their most important park needs. This list, when most recently compiled, totaled $5.6 billion. We have consistently stated to Congress and other interested parties that attempting to draw precise conclusions concerning unfunded needs by simply alluding to a single project list can be misleading.

For an agency as diverse and with projects as complex as those of the National Park Service, any standing list of maintenance and construction projects can only be an "order of magnitude" estimate until those jobs are actually subjected to real project analysis and the bidding process prior to execution. Too many variables change over time to be able to precisely pinpoint the costs of hundreds of standing projects. These variables may include progressive deterioration of facilities over time, rising costs of labor and materials, changing use patterns by visitors and catastrophic events.

$5.6 billion is a current estimate of a general pool of important construction and rehabilitation needs in the field; however, the total expands or contracts depending on the definition applied. If, for example, we were to exclude road and parkway projects, this figure would decline to closer to $3.4 billion. If we remove new construction, the figure shrinks another $0.5 billion. This is an important distinction as we attempt to credibly link our particular project needs to the various line-item categories or funding resources that might be available.

The Park Service has also been reluctant to simplistically quantify its unfunded needs using the concept of a $5.6 billion backlog, because it is misleading on practical grounds. We simply could not accomplish all of the listed projects in the near term. While we would like to complete all of the projects listed in this master pool, the truth is, we have to live within a finite annual budget and a limited capacity to accomplish this work. As a result, the composition of the list changes as we tackle the highest priority projects. Even if we received $5.6 billion dollars of line-item construction money in one budget, because of the complexity, planning, contracting and multi-year nature of many of these projects, we could not realistically solve all of our needs at once.

There have also been questions raised concerning our inclusion of new construction projects within the overall list referred to by Congress and the GAO as our maintenance backlog. We have been quick to point out that new construction projects identified on the $5.6 billion list have been clearly identified as new projects in our testimony and reporting documents. When these items are explained, one can easily understand why they appear on a list of projects we believe are overdo for funding. Examples include visitor facilities and utilities for newer parks that remain without infrastructure or cases where an existing facility is so worn out, it needs complete replacement. In other instances, visitor use has grown so dramatically that a facility, built decades ago, must be replaced to handle the current volume of visitor use. We have also found that as building codes change and materials, once commonly used in construction, are found to be unsafe, it is occasionally less expensive to replace a facility rather than rehabilitate an older one.

All of these factors argue for a sensible process for identifying key maintenance and construction needs and for linking them to budget categories that make sense in terms of appropriations. Developing and adhering to sensible criteria that dictate project priorities is also critical if we are to maintain our credibility with the Congress and with the taxpayers. I am happy to report that the Park Service has instituted procedures that meet these objectives.

Our current prioritizing system, "Choosing By Advantage", or CBA, was developed at the urging of this subcommittee in 1994. The Park Service borrowed and adapted the CBA methodology from the U.S. Forest Service, briefed all of those concerned and implemented the system in 1995. Because of the time lag in the budget and construction process, our first budget results stemming from the CBA technique will appear in the fiscal years 1999 and 2000.

Under the CBA system of identifying project priorities, we evaluate the projects on our master list against a set of standard criteria. By filtering all of the standing projects through the criteria, we develop an annual list of highest priority projects. That priority list currently totals $568.9 million of non-road projects and is subject to a tentative five-year plan for accomplishment. Of this number, approximately 60% involves building improvement projects, 20% involves utilities (water, sewer and power), with the final 20% for resource protection, stabilization and restoration projects.

The criteria used to create the priority list include: public safety, loss prevention, employee safety, improving the existing condition of a facility, provision of public services, improvement of efficiency and advantages to the agency.

The Department is currently developing a framework to establish consistent Department-wide priorities for construction as well as repair and rehabilitation projects. As part of this effort, for fiscal year 1999, the Park Service and the Department have convened a working group to review and prioritize the 1999 construction and repair and rehabilitation tentative projects with an emphasis on health and safety as well as natural and cultural resource preservation. The working group will complete its work by the end of February.

Let me turn for a moment to the subject of park roads and highway projects. Since 1983, the Federal Lands Highway Program has been the primary funding source for the repair and construction of park roads and parkways. Throughout the Service, we estimate there are about $2.2 billion in road and transportation-related projects. The Administration has, in it's proposed reauthorization of the Inter-Modal Surface Transportation Efficiency Act (ISTEA), proposed funding for park roads from the Federal Land Highway Program at $161 million annually. Bills currently under consideration by both the House and the Senate do not include funding at the Administration's recommended level. According to engineering analyses performed for the Service by the Federal Highway Administration, without full funding, our roads and bridges will continue to deteriorate at an accelerating rate. This deterioration would negate the progress previously made under the Federal Lands Highway Program.

What is the outlook? I would like to make four points.

We believe that through the careful use of our CBA methodology, Federal Lands Highway funding at the Administration's recommended level, anticipated increases in repair/rehab funding and the use of fee demonstration revenues, we will be able to clearly identify, prioritize and begin working through the critical maintenance and construction needs of the System.

It seems essential to me that we work with the Congress to create universally clear definitions and a common syntax to communicate our unfunded maintenance and construction needs. This will require distinguishing between annual operational maintenance shortfalls, deferred maintenance needs, unfunded repair-rehabilitation needs, new park facility construction, old facility total remodeling or replacement and all of the other categories that have led to confusion as to the size of our maintenance and construction needs. This is consistent with Assistant Secretary Barry's recent direction for the Deputy Chief Financial Officer and the Department's Interior Planning, Design, Construction and Maintenance Council to develop uniform definitions for deferred maintenance, repair and habilitation, and construction by February 1998.

We need your support in recognizing that while life/safety projects are essential, the two-fold mission of the Park Service is resource protection and visitor services. Fulfilling that mission necessitates some consideration of new visitor facilities and projects for the protection of natural and cultural resources. In my confirmation hearing testimony last summer before the Senate Energy and Natural Resource Committee, I listed five broad goals for my tenure as Director. One of these goals was and is ensuring that the safety and health of employees and visitors is provided to the maximum extent possible. It seems evident that we share a common starting point in our philosophical priorities. But we must also remember why the national park system was created in the first place and have those needs respected in the budget process.

We will continue to base our prioritizing criteria heavily on urgent, life/safety values, while also using the CBA method to look for the best economies of scale to get collateral work accomplished when evaluating projects. We will also be paying close attention to the recommendations of the National Academy of Public Administration final report, due June 15, 1998. This analysis of our management of maintenance and construction budget practices is sure to contain valuable advice for further improving our approach.

In the meantime, we will adhere to our rigorous system of project approval, design development and project oversight to track progress and ensure costs are within contract limits. To increase our efficiency, the Denver Service Center (DSC) is revising some of our construction supervision to reduce the number of field employees. Sixteen employees will return to the DSC by the end of fiscal year 1998. We are contracting with architectural and engineering firms in close proximity to construction projects to reduce travel and per diem costs. In fiscal year 1998, the design cost target has been reduced to 18 percent. This compares with 21 percent in 1997 and an industry standard of 28-32 percent. At an alternative stage of all projects, the center will provide the superintendent with one alternative that is 75 percent less than the net construction estimates.

Regarding our progress on employee housing, two housing assessment contracts have been awarded and I expect to have initial results for four prototype studies by February 6 and the final report on the prototypes by March 6, 1998. Contractors should complete the final assessment on all parks with more than five units by October 5, 1998.

As we administer our planning, design and construction processes, we will also ensure that our work is consistent with the intent and the spirit of the National Park Service Strategic Plan and the Government Performance and Results Act.

In addition to maintaining strict project oversight, I believe our task is to recognize the essential maintenance needs of existing facilities, in balance with our responsibility to protect park resources and facilitate worthy visitor services. I ask that you support this critical combination of values as we strive to address our maintenance and construction needs.

Thank you once again for the opportunity to speak to you on this issue. I am available to answer any questions, either for the panel today or for submission to the record.