CECW-PE 20 December 1999

Table of Contents
1. Plan Formulation
2. Project Costs  a. Implementation Costs  b. Inconsistent Implementation Costs
3. Recreation Plan Benefits and Costs
4. Cost Apportionment  a. NER Plan  b. NED Plan   c. LPP
5. Economic Evaluation  a. Use Of Partial Duration Discharge-Frequency Data  b. Replacement Costs For "Historic" Structures   c. Damages To Rancho California Sewage Treatment Plant  d. Future Structures in the Floodplain   e. Benefit-Cost Ratio Based On Existing Conditions  f. Flood Insurance Administration Cost Savings  g. Financial Versus Economic (NED) Costs
6. NED Environmental Restoration Plan
7. Identification of Nonfederal Spronsor by Project Purpose
8. Aesthetic Treatment Costs Associated With Ecosystem Restoration
9. Sand Levees
10. Environmental Review Comments a. Recreation on Ecosystem Restoration Lands  b. Monitoring For Mitigation and Ecosystem Restoration  c. Incremental Cost Analysis (ICA) And Cost Effectiveness Determination (CED) 
11. Risk and Uncertainty
12. Credit for Work Completed by the Nonfederal Sponsor
13. Nonfederal Sponsor Letter
14. Real Estate
15. Documentation of Technical and Legal Review
16. Program Management
17. Editorial/Report Inconsistencies

1. PLAN FORMULATION. Plan formulation is difficult to follow and appears to incorrectly apply planning principles to influence cost apportionment. The document combines the NED plan for flood damage reduction with a stand-alone NER plan and labels this combination the "NED Plan" for cost-sharing purposes. The plan formulation exercise uses the estimated cost of the NED/NER plan to determine the amount of Federal participation in a multipurpose locally preferred plan. The NER and locally preferred ecosystem plans were developed to employ the same site and produce an identical environmental output. The cost of the locally preferred ecosystem restoration plan ($7,325,000) is substantially less than the NER plan ($28,406,900). This is because all LERRD and site preparation required to implement the locally preferred ecosystem restoration plan is charged to the LPP flood control feature. On this basis, the AFB document concludes that the Federal share NED/NER plan would be greater than the amount from 65-35 cost sharing of the LPP flood control and ecosystem restoration components. It is not apparent that the assumption that there is a willingness to pay $28,406,900 for the expected environmental outputs from a stand-alone NER plan is valid. It is not clear that the estimated $21 million in LERRD, clearing, and contouring expenditures needed to support the $7.3 million in new vegetation planting constitutes appropriate restoration. The stand-alone NER plan only surfaces in the main document and is not discussed in the environmental impact statement or other portions of the report. It must be clearly documented that a reasonable number of ecosystem restoration alternatives of varying scope and cost have been developed and evaluated.

DISTRICT RESPONSE: A thorough analysis of alternative restoration sites in the watershed indicated that the proposed site was the most cost-effective for ecosystem restoration, primarily because of the confluence of the different watercourses, availability of groundwater to support a riparian ecosystem, the current lack of valuable resources in the proposed project area and the availability of open land. An array of alternative sites was evaluated and the proposed site is the most cost-effective. The scale of the single purpose ecosystem restoration plan was limited to the most cost effective way of obtaining the outputs of the multi-purpose project, in order to form the required basis for the cost allocation. The plan was formulated to take optimal advantage of the open land that is available, exclusive of lands that the sponsor wishes to reserve for recreational activities. Expansion of the site beyond these boundaries was judged to be much less cost effective because of required relocations, excessive excavation required, and high real estate costs. These are the same constraints that effect the scope of the multi-purpose project. In the incremental analysis, the planting of vegetation would provide the greatest value per dollar. However, the ability to plant is dependent upon real estate acquisition and excavation that is required to provide access to groundwater, low flow channels, backwaters and ponded areas, that will allow a transition of wetlands from freshwater marsh to willow riparian. Based on revised estimates and the concerns expressed in this comment, the cost of the NER Plan has been reduced to $21 million. The separable cost of ecosystem restoration in the multi-purpose plan is not, however, limited to the $7.3 million cost of planting but is, instead, the allocated cost of ecosystem restoration, or approximately $23.4 million. Federal Participation would be capped, however, at the cost of the NER Plan ($21 million). It is recognized that these numbers may change as a result of comments that follow and further refinement of costs. The local sponsor has expressed support for participating in an ecosystem restoration plan of this magnitude.

DISCUSSION: The sponsor and the Los Angeles District have been driven by the requirement to have the project ready for inclusion in WRDA 2000. The schedule to accomplish that ambitious goal has caused the study to give less than full consideration to potential measures that might be implemented upstream of Elm Street for ecosystem restoration. The consensus was reached that the primary objective of the study should now be to develop a more complete project and that an appropriate goal would now be to ready the project for a potential conditional WRDA 2000 authorization with a Chief’s report in December 2000.

The plan presented by the district includes the most cost-effective ecosystem restoration measure and while it was agreed that the district had done a good job in formulating the plan in the report, there was a consensus that additional measures for ecosystem restoration and potentially other purposes may be valid candidates for incorporation into the tentatively selected plan. Specifically noted by HQUSACE representatives were additional ecosystem restoration sites that the district had previously screened. The continuation of the habitat corridor through the system for the passage of different species was identified as an especially important goal. Specific recommendations included evaluation of the following:

(1) Floodway acquisition with improvement of existing habitat in the upstream reaches.

(2) Acquisition and removal of the few structures that are subject to frequent flooding between Ivy and Kalmia Streets, coupled with restoration of habitat measures.

(3) Potential use of treated effluent to promote ecosystem restoration in the sandy reach between Elm Street and Ivy Street. The need for sideslope stabilization structures to insure a stable environment to maintain the habitat should also be evaluated.

(4) Camp Pendleton has expressed interest in the development of water rights that they hold. The potential of groundwater recharge in the reach between Elm Street and Ivy Street should be evaluated.

(5) Opportunities for participation in the "Challenge 21" program which is not subject to the same economic evaluation criteria should be evaluated.

ACTION REQUIRED: The district will develop a more comprehensive project addressing both the Temecula and Murrieta Creek areas, with a goal to ready the project for a potential conditional WRDA 2000 authorization and a Chief’s report in December 2000. Additional measures for ecosystem restoration and potentially other purposes will be evaluated as candidates for incorporation into the tentatively selected plan, including ecosystem restoration measures that the district had previously screened. Additional measures above Elm Street for ecosystem restoration, potential groundwater recharge and the "Challenge 21" program will be evaluated.

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2. PROJECT COSTS.

a. Implementation Costs. Project implementation costs are stated incorrectly throughout the document. Table 5.1-3 shows an entry of $996,535 for O&M as part of the total $28,406,936 cost reported for ecosystem restoration alternative A. This total cost is subsequently used in the Federal / non-Federal cost apportionment shown in Table 5.1-4. Similarly, paragraph 5.8.1 on page 188 indicates that the total cost of the LPP (including, flood damage reduction, ecosystem restoration, and recreation) is $44,747,794. The text of this paragraph indicates that this amount includes "… approx. $1,000,000 for operations and maintenance over the life of the project,…." The $44,747,794 amount (which apparently includes OMRR&R) is subsequently used in the Federal / non-Federal cost apportionment shown in table 6.3-1. Also note that the costs associated with each of the seven flood damage reduction plans (section III, appendix F) include an O&M line item as part of the "Grand Total" cost. It is not clear if the O&M line item represents the present value of the stream of anticipated OMRR&R expenditures or simply the sum of 50 assumed annual OMRR&R costs. OMRR&R costs should not be included in the implementation costs (first cost) of alternative plans. O&M costs should be shown as 100 percent non-Federal. Revise the cost estimates as necessary. Explicitly display costs as separate implementation costs and expected equivalent annual OMRR&R costs. Only project implementation costs are to be included in the total project cost used to apportion the Federal and non-Federal shares of the project cost.

DISTRICT RESPONSE: The report will be corrected and OMRR&R costs will not be included in the total first costs of the alternative plans. OMRR&R costs will be shown as a 100 percent local responsibility and they will not be included in the apportionment of total project first costs.

DISCUSSION: The comment is provided to aid in the development of the draft report.

ACTION REQUIRED: Costs will be explicitly displayed in the draft report as separate implementation costs and expected annual OMRR&R costs. The implementation costs will be the project first costs that are the basis for apportionment of Federal and non-Federal costs. OMRR&R costs will be shown as 100 percent non-Federal and will not be included in the apportionment of total project first costs.

b. Inconsistent Implementation Costs. Cost information presented in Table 5.1-1 does not agree with costs shown in section III of Appendix F for each of the flood damage reduction alternatives. Consistent cost information must be presented in the draft report and appendixes.

DISTRICT RESPONSE: The costs will be revised to respond to other comments and consistent cost information will be provided in the draft report and appendices.

DISCUSSION: The comment is provided to aid in the development of the draft report.

ACTION REQUIRED: Consistent cost information will be presented in the draft report and appendices.

3. RECREATION PLAN BENEFITS AND COSTS. Recreation benefits are not quantified in the report and the $2,210,700 cost is included in the $35,750,200 cost of the locally preferred flood damage reduction plan (See table E25, economic appendix). Consequently, it can not be determined if the recreation plan proposal is economically justified and eligible for Federal participation. Benefits and costs associated with each project purpose must be separately identified in the draft report. Separate benefit-cost ratios must be presented for the flood damage reduction and recreation project purposes.

DISTRICT RESPONSE: Recreation benefits will be presented in the draft report. The allocated cost to flood control in the multi-purpose project is estimated to be $21.2 million. Federal participation would be capped, however, at the $18.8 million cost of the NED flood control plan. The separable cost for recreation is $2,210,700 and no joint costs will be allocated to the recreation purpose. Benefit-cost ratios for the flood damage reduction and recreation project purposes will be calculated based upon these values, subject to revisions in the costs in response to other comments.

DISCUSSION: The comment is provided to aid in the development of the draft report.

ACTION REQUIRED: Benefits and allocated costs that are associated with each project purpose will be identified in the draft report. Separate benefit-cost ratios will be presented for flood damage reduction and recreation based on the allocated costs and monetary benefits.

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4. COST APPORTIONMENT. Cost apportionment shown in several tables of the report does not appear to be correct.

a. NER Plan. Table 5.1-4 presents incorrect cost apportionment for the NER plan. While the table correctly indicates 65 percent Federal / 35 percent non-Federal cost sharing, it also indicates a separate 5-percent cash requirement. The 5 percent cash requirement applies only to the flood damage reduction project purpose.

b. NED Plan. Table 5.1-5 presents incorrect cost apportionment for the "NED plan." This table includes line items costs of $17,206,000 for "flood control construction" and separate line item of $1,620,452 for LERRD for flood control. Table E25 of the economic appendix shows the $1,620,452 "real estate" cost included in the $17,206,000 project cost for flood damage reduction. Thus it appears that this amount has been included twice in Table 5.1-5.

c. LPP. The stated total cost and cost apportionment for the LPP appears to be incorrect. Adding the reported costs for each project purpose, we estimate the cost of the LPP as $43,075,200. This amount is composed of $33,539,500 allocated to the flood damage reduction project purpose ($35,750,165 less $2,210,702 in recreation costs, table E25 economic appendix), $7,325,000 for ecosystem restoration, and $2,210,700 for recreation. Assuming that the recreation feature is economically justified and eligible for Federal participation (see comment 5), the Federal share is estimated as $17,047,500. This amount includes $11,183,900 for flood damage reduction (65 percent of the NED plan for flood damage reduction), $4,761,250 for ecosystem restoration (65 percent of $7,325,000), and $1,105,350 for recreation (50 percent). The total non-Federal share is then estimated as $26,027,700. A cost apportionment display must be included in the draft report that clearly shows appropriate cost sharing for the NED plan and the LPP. For each plan, and each project purpose, costs for LERRD, major construction features, environmental mitigation, PED, and construction management should be displayed for easy comparison.

DISTRICT RESPONSE: The 5 percent cash requirement applies only to flood control and will not be applied to cost apportionment of the NER Plan. Similarly, the discrepancies in the costs of the NED plan will be resolved. The cost apportionment of the multipurpose project would be $21.2 million for flood control and $23.4 million for ecosystem restoration (based on a variation of the separable cost – remaining benefits method). Costs in excess of the NED Plan and NER Plan respectively would all be apportioned to the non-Federal sponsor. The cost allocation tables will display costs for LERRD, major construction, mitigation, PED and construction management. A cost apportionment table will be included in the draft report that displays the appropriate cost sharing for the NED Plan, NER Plan and locally preferred plan.

DISCUSSION: The comment is provided to aid in the development of the draft report.

ACTION REQUIRED: The 5 percent cash requirement will only be applied to the allocated costs of flood control. Costs of the NED Plan will be reviewed and discrepancies will be resolved. Costs in excess of the NED Plan and NER Plan will be apportioned to the non-Federal sponsor. The cost allocation tables will display costs for LERRD, major construction, mitigation, PED and construction management. A cost apportionment table will be included in the draft report that displays the appropriate cost sharing for the NED Plan, NER Plan and locally preferred plan.

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5. ECONOMIC EVALUATION.

a. Use Of Partial Duration Discharge-Frequency Data. Use of partial duration discharge-frequency data may have resulted in overstating expected flood damages and project benefits. This may call to question the economic justification cited for alternatives 5 and 6. Pages 21 and 22 of Appendix C, Hydrologic Analysis, states the following: "The partial duration frequency curve was considered more representative of Murrieta Creek and was adopted for this study (See Plate 15). The adopted discharge frequency values and curve (Plate 18) included all years from 1906 to 1997, with partial duration data as adjusted for controlled runoff." Partial duration discharge data relate to multiple floods per year and should account for each damaging flood that is economically and hydrologically independent. Use of such data maybe appropriate for economic analyses of agricultural damages where multiple crops could be planted and damaged annually. Conversely, partial duration data may not be appropriate for use in economic analyses of urban flooding. There is an implicit assumption in analyses of urban flood damages that there is sufficient time between flood events to allow full recovery of all damageable property. That is, floods are assumed economically independent. Exhibit 4 of Appendix C shows that a large number of the partial duration peak flows used in the economic evaluation occurred during periods of two months or less. Many were measured on consecutive days. Clearly, such flood flows should not be considered hydrologically or economically independent. Typically, it may not be reasonable to assume recovery of all damageable urban property in periods less than six months to one year. The most pronounced difference between annual series and partial duration data is evident at the high frequency end of the curves. That is, the partial duration series will show higher flows for the shorter recurrence intervals (more frequent floods). Damages associated with high frequencies can have a pronounced effect on computed expected annual damages (EAD). The draft report should state the assumed interval required for full recovery of damageable property, if assumed less than one year. The report should document that the nominal interval required for recovery of damageable property is consistent with the minimum interval used to sort and select partial duration discharges. Provide information on computed EAD and benefits without the partial duration adjustment. More appropriately, discharge-frequency values adopted for use in the economic evaluation of urban flood damages should consist of the annual series data without the partial duration adjustment. The draft report should display the contribution of various frequency floods to total expected annual damages. Expected annual damages and benefits should be revised.

DISTRICT RESPONSE: As shown on Plate 15 of Appendix C, Hydrologic Analysis, the observed partial peaks fall along the same curve with the observed annual peaks for events equal to and greater than the 11-year event. For events equal to and less than the 10-year event, the observed annual peaks are less than the observed partial peaks. As indicated on Table E12 of Appendix H, Economic Analysis, the non-damaging events for the critical reaches are the 10-year event. Therefore, the only significant contributions to the annual damages that could be sensitive to the difference between the observed partial peaks and the observed annual peaks would be for the 10-year event. However, expected annual damages should be unaffected because the "non-damaging" event typically includes costs of a less permanent and non-structural nature. These economic costs and damages can continue to be incurred and re-incurred even if events happen close together in time. In the case of larger events, the damage would be more permanent structural damage where it would be unreasonable to assume that structures can be rebuilt and re-damaged in flood events close together in time. Since in these larger events there are no significant differences between the observed annual peaks and the observed partial duration peaks, there would be no differences in the damages. The contribution of various frequency floods to total expected annual damages are shown on Table E17 of Appendix H, Economic Analysis. The expected structural and content damages from the 10-year event are limited to $637,000, a very small contribution to the average annual damage. As a side note, the existing condition discharge-frequency results are slightly lower than the results of the calibrated model. This is because the historical channel was a sandy bed channel and the present channel includes vegetation that is a recent occurrence, caused by the discharge of effluent from the sewage treatment plants.

DISCUSSION: The comment is provided to aid in the development of the draft report. Discharge-frequency values adopted for use in the economic evaluation of urban flood damages should consist of the annual series data without the partial duration adjustment. Refer to ER 1110-2-1450. Use of partial duration data for urban flood damage reduction studies is strongly discouraged. This technique should not be employed for future urban flood damage reduction studies without prior approval from CECW-E.

ACTION REQUIRED: No further action required.

b. Replacement Costs For "Historic" Structures. The economic appendix indicates that there are 12 buildings "that could be potentially designated on the National Register of Historic Places." The evaluation assumes that "the replacement cost for the these structures is expected to be about $100 per square foot. The higher replacement cost is due to finding similar materials and duplicating the designs of the buildings." Conceptually, it is appropriate to use "reproduction costs" for historic structures instead of depreciated replacement costs (see IWR Report 95-R-9). However, standard depth-damage curves should not be used to estimate the cost of repair for non-standard structures. It is repair costs that we generally mean to estimate. Average replacement cost (cost per square foot) has no direct relevance for repairs. National Register candidates could be non-standard structures in the sense that ‘extraordinary’ repair criteria might apply. If so, the damages should be estimated directly as estimated repair costs. Therefore, structure specific (or group of structures specific, up to all the ‘special’ structures as a single group) damage estimates should be used in the economic evaluation. Structure value, depreciated structure value, and replacement cost do not apply when repair costs are directly estimated.

Depreciation must be accounted for, however. Depreciation will depend on the specifics of the structures, their current conditions, when they would be ‘rehabilitated’ as historic properties, whether they have been previously modified to "non-historic" standards and so on. Accounting for depreciation is necessary to avoid counting betterments as flood damage avoided.

Additionally, we are concerned by the characterization that the structures in question "could be potentially designated on the National Register of Historic Places." This statement may be applicable to large numbers of properties. Are the properties located in a designated historic district? Are local ordinances currently in effect that regulate exterior repair and maintenance of the structures in question? If such ordinances are in effect, the draft report should document the likelihood that these regulations would be enforced in the event of major flood damage to the structures.

DISTRICT RESPONSE: First, the District will verify that the depth-damage curves used in the study are applicable to the historical buildings. Secondly, the District will contact the local government agencies to identify any special zoning or building codes that are related to the historical buildings in the floodplain.

DISCUSSION: The comment is provided to aid in the development of the draft report.

ACTION REQUIRED: The draft report will document any special zoning or building codes that are related to the historical buildings in the floodplain. Damages will be determined based on estimated repair costs associated with these requirements.

c. Damages To Rancho California Sewage Treatment Plant. The economics appendix states that the wastewater treatment facility is surrounded by a levee that is expected to protect it from a 500-year event. Yet, the economic evaluation assumes: "If the levee is breached by erosion, the flood waters are expected to erode the sewage plant’s pools (pools have a total value of $2,000,000) holding the untreated water." The appendix states that: "The HEC-FDA calculated the equivalent annual damages to the treatment plant to be $36,200." The basis for this assumed multi-event scenario, including the estimated conditional probabilities of levee failure and pool damage, should be documented in more detail. What is the basis for the assumptions that the "500-year LOP" ring levee has a 15 percent probability of being "undermined" by a 25-year flood event and an 85 percent probability of being "undermined" by a 100-year event? Given the ring levee gets damaged, what is the basis for the assumption that the wastewater treatment plant pools will also be damaged? What are the assumptions regarding the extent of damage caused to the wastewater treatment pools by different flood events?

DISTRICT RESPONSE: The District will provide a detail explanation of how the corresponding probabilities were assigned to the 25-year and 100-year events. Also, the draft report will have a detailed explanation of the assumptions regarding the extent of damage caused to the wastewater treatment pools by different flood events.

DISCUSSION: The comment is provided to aid in the development of the draft report.

ACTION REQUIRED: The draft report will include an explanation of how the corresponding probabilities were assigned to the 25-year and 100-year events. Also, the draft report will have a detailed explanation of the assumptions regarding the extent of damage caused to the wastewater treatment pools by different flood events.

d. Future Structures in the Floodplain. The economic appendix indicates that the inventory of structures includes eight (8) commercial structures that are expected to be built before the 2001 base year. We note that many more developments are planned than are actually constructed. Consequently, the draft report should include a detailed discussion of the status of the expected construction. Are any of the structures currently under construction? How were the replacement costs for the eight structures estimated?

DISTRICT RESPONSE: The District will ask to the local planning agencies to provide more information regarding the construction of the future buildings. This information will be incorporate into the draft report. Also, the draft report will detail how the replacement cost was calculated from Marshall&Swift.

DISCUSSION: The comment is provided to aid in the development of the draft report.

ACTION REQUIRED: Information regarding the current status of the commercial development that is expected to be built before the 2001 base year will be included in the draft report. Also, the draft report will describe how the replacement costs for the commercial structures were estimated.

e. Benefit-Cost Ratio Based On Existing Conditions. ER 1105-2-100, paragraph 6-40. b, requires that a BCR based on existing conditions be presented. The definition of existing conditions should be based on existing development and hydrology and not involve projections or forecasts of any kind. The draft report should present benefit-cost information based on existing conditions so the magnitude of the effect of the various forecasts on economic justification is apparent.

DISTRICT RESPONSE: The draft report will show a table that presents benefit-cost information for existing conditions.

DISCUSSION: The comment is provided to aid in the development of the draft report.

ACTION REQUIRED: The draft report will include benefit-cost information based on existing conditions.

f. Flood Insurance Administration Cost Savings. The reported benefit for reducing national flood insurance overhead costs is not supported in the report. The analysis assumes 10 percent of the properties located within the median 100-year floodplain participate in the National Flood Insurance Program (NFIP). In accordance with ER 1105-2-100, paragraph 6-41.b, the basis for claiming NFIP administration cost savings should be the documented costs of servicing flood insurance policies in effect at the time of the study. The draft report must provide a basis for the assumed 10 percent NFIP participation rate.

DISTRICT RESPONSE: Currently, the District is working with FEMA to obtain a list of the policies within the floodplain. This information will be incorporated into the draft report.

DISCUSSION: The comment is provided to aid in the development of the draft report.

ACTION REQUIRED: The draft report will provide the basis for the percentage of properties that participate in the National Flood Insurance Program..

g. Financial Versus Economic (NED) Costs. Pages 119 and 120 of the main report indicate that the sponsor "owns" segments of Murrieta Creek in fee. This potentially presents a situation where there may be a divergence between the project financial and economic costs. Whereas, the fair market value of the lands are properly implementation (financial) costs, in a situation where a project must acquire land that is and will remain streambed, the economic (NED) cost is $0. The district should determine if the current situation is one where the project cost (financial) and NED cost diverge. If so, document the rationale for this conclusion in the draft report, and exclude streambed costs of from the economic evaluation of alternatives (see IWR Report 93-R-12, page 68).

DISTRICT RESPONSE: Whether the sponsor owns particular segments of Murrieta Creek will not affect either the economic or financial costs of the project. The fair market value of the properties are properly financial implementation costs, regardless of ownership. While there may not be an economic cost for streambed lands, prior policy has been to include the financial costs of acquisition as economic costs if the sponsor is to be afforded cost-sharing credit for these lands.

DISCUSSION: The comment is provided to aid in the development of the draft report.

ACTION REQUIRED: If an economic value less than the financial cost of streambed lands is included in the economic analysis, then the rationale for this conclusion will be included in the draft report.

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6. "NED ENVIRONMENTAL RESTORATION PLAN." The AFB document describes an ecosystem restoration proposal as the "NED Environmental Restoration Plan." This terminology is incorrect. Per Chapter 5, ER 1105-2-100, 31 October 1997, this alternative may be designated the national ecosystem restoration (NER) plan.

DISTRICT RESPONSE: All references to the single purpose ecosystem restoration plan that reasonably maximizes ecosystem restoration benefits will be identified as the NER Plan.

DISCUSSION: The comment is provided to aid in the development of the draft report.

ACTION REQUIRED: The draft report will use the term "NER Plan" exclusively when identifying the ecosystem restoration plan that reasonably maximizes ecosystem restoration benefits.

7. IDENTIFICATION OF NON-FEDERAL SPONSOR BY PROJECT PURPOSE. The draft feasibility report must explicitly identify a non-Federal sponsor for each project purpose.

DISTRICT RESPONSE: The draft feasibility report will explicitly identify the non-Federal sponsor for each project purpose.

DISCUSSION: The comment is provided to aid in the development of the draft report.

ACTION REQUIRED: The draft feasibility report will explicitly identify the non-Federal sponsor for each project purpose.

8. AESTHETIC TREATMENT COSTS ASSOCIATED WITH ECOSYSTEM RESTORATION. Table 5-1-3: Costs of Environmental Restoration Alternative A, lists a line item cost of $510,496 for "aesthetic treatment." Page 189 of the main report states for the locally preferred plan: "Funds allocated to aesthetic treatment will be used to improve the look of concrete outlet controls and other features to ensure that they blend more readily into the surrounding landscape." It is not clear why this cost is included in the cost of the NER plan since it would not involve construction of a detention basin with concrete outlet structure. The draft report should explain and justify the half-million dollar esthetic treatment for ecosystem restoration.

DISTRICT RESPONSE: The Environmental Restoration Alternative does not require aesthetic treatment. The District will delete the Aesthetic Treatment Costs from this alternative.

DISCUSSION: The comment is provided to aid in the development of the draft report.

ACTION REQUIRED: Aesthetic treatment costs will be deleted from the environmental restoration alternative(s) presented in the draft report.

9. SAND LEVEES. Page 25 of the Appendix C indicates that sand levees are located at some locations along Murrieta Creek. The text states that these levees "were assumed to be nonexistent in the hydrologic models." Apparently the sand levees have been in existence for some period of time and perhaps do afford some minimal level of protection from lesser floods. The estimated impact of the sand levees should be reflected in the economic evaluation of future without project conditions.

DISTRICT RESPONSE: The existing levees along Murrieta Creek serve no current flood control purpose. Any flood event which exceeds channel capacity will bypass the existing levees. Hydrologic and hydraulic analyses indicate that there is no protection currently offered by these features.

DISCUSSION: The comment is provided to aid in the development of the draft report.

ACTION REQUIRED: The draft report will describe the rationale for assuming that the sand levees are nonexistent in the hydraulic models.

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10. ENVIRONMENTAL REVIEW COMMENTS.

a. Recreation on Ecosystem Restoration Lands. Recreation is being proposed to be located on lands that will be restored to increase their natural productivity. Any such restoration must comply with Planning Guidance Letter No. 59, "Recreation Development at Ecosystem Restoration Projects" dated 11 June 1998. Lands that will be restored along the Murrieta Creek will undoubtedly provide habitat for several Federally listed threatened or endangered species, or may attract such species. Consequently, particular care must be given to minimize any potential conflicts between even low, passive recreational use of these areas and these species life requirements. Paragraph 5.5, page 187, for example, states that ball fields would be constructed on the recreation lands. Ball fields would not be appropriate for ecosystem restoration areas and are not listed in PGL No. 59.

DISTRICT RESPONSE: Care was taken during the plan formulation and ecosystem restoration formulation process to ensure that effects of recreation would be minimized through the development of "buffers" and other natural features that would preclude negative impacts to the restoration site. The area proposed for recreational usage, which may include ball fields, are not part of the property devoted to environmental restoration. The environmental restoration site is to be used solely for the purposes of restoration and flood control storage, which are not mutually exclusive.

DISCUSSION: The comment is provided to aid in the development of the draft report.

ACTION REQUIRED: Recreational facilities that are proposed for cost sharing will be restricted to those that are listed in EP 1165-2-502, "Ecosystem Restoration- Supporting Policy Information, dated 30 September 1999, which supercedes PGL No. 59. The separation of restoration and recreation will be described in the draft report.

b. Monitoring For Mitigation and Ecosystem Restoration. The report should include a discussion, and any anticipated costs, of monitoring for both mitigation and ecosystem restoration. These should be identified separately. Current Corps of Engineers policy for monitoring of mitigation features (taken from the Digest of Water Resources Policies and Authorities, EP 1165-2-1, 30 July 1999) follows:

Current Corps policy on monitoring for ecosystem restoration projects (still draft) is that cost-shared monitoring should not exceed five years after construction, after which time all further monitoring requirements will be carried out by the local sponsor at their cost. The cost of any cost-shared monitoring should not exceed one percent of the total cost of the ecosystem project.

DISTRICT RESPONSE: The revised report will contain a discussion on the costs of monitoring for both the mitigation and environmental restoration areas.

DISCUSSION: The comment is provided to aid in the development of the draft report.

ACTION REQUIRED: The draft report will include a discussion of the monitoring plans and costs for both the mitigation and environmental restoration areas. The duration of cost-shared monitoring will not exceed five years after construction and not exceed one percent of the total cost of the restoration project.

c. Incremental Cost Analysis (ICA) And Cost Effectiveness Determination (CED). An ICA and CED must be conducted for both mitigation and ecosystem restoration components, or any single purpose ecosystem restoration plan. These analyses are to be conducted separately for these features and are not to be combined. All adverse impacts on a resource must be fully mitigated before ecosystem restoration for lands and waters including that resource can be formulated.

DISTRICT RESPONSE: An incremental cost analysis will be included in the draft report. This analysis will include the results of the studies, which demonstrate that the proposed NER plan is the most cost effective plan in providing ecosystem restoration, as described in the response to Comment 1.

DISCUSSION: The comment is provided to aid in the development of the draft report.

ACTION REQUIRED: As a result of discussions at the AFB, an expanded array of potential restoration measures will be included in an incremental analysis. The incremental analysis and a cost effectiveness analysis determination will be conducted as a basis for evaluating and selecting various sites for restoration. The results of the incremental analysis and cost effectiveness analysis determination will be included in the draft report.

11. RISK AND UNCERTAINTY. The draft report should describe the degree of uncertainty regarding the engineering and the economic performance of the alternative plans in probabilistic terms. ER 1105-2-101 contains guidance on how to describe the expected performance of alternative plans. The draft report should include a tabular display that compares the performance of alternative plans in terms of expected annual exceedance probability, conditional non-exceedance probabilities for various frequency storms, and long term exceedance risk.

DISTRICT RESPONSE: The District will include a tabular display that compares the performance of the final alternative plans in terms of expected annual exceedance probability, conditional non-exceedance probabilities for various frequency storms, and long term exceedance risk.

DISCUSSION: The comment is provided to aid in the development of the draft report.

ACTION REQUIRED: The draft report will include a tabular display that compares the performance of the final alternative plans in terms of expected annual exceedance probability, conditional non-exceedance probabilities for various frequency storms, and long term exceedance risk.

12. CREDIT FOR WORK COMPLETED BY THE NON-FEDERAL SPONSOR. Item A. (4) in the Recommendation section on page 196 addresses credit for work performed by the non-Federal sponsor. Note that such credit requires prior approval by the ASA(CW) in accordance with procedures outlined in paragraph 9 of ER 1165-2-29.

DISTRICT RESPONSE: The reference to credit due non-Federal sponsor will be deleted.

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DISCUSSION: The comment is provided to aid in the development of the draft report.

ACTION REQUIRED: References to credit due the non-Federal sponsor will be deleted from the draft report.

13. NON-FEDERAL SPONSOR LETTER. CESPL should obtain a letter from the non-Federal sponsor indicating that they have reviewed the draft feasibility report and support the recommended plan. The letter should indicate an understanding of the non-Federal responsibilities and required financial commitment for initial construction, OMRR&R, and LERRD. The letter should also briefly describe the source of non-Federal funding.

DISTRICT RESPONSE: A letter of intent from the non-Federal sponsor will be transmitted with the final feasibility report.

DISCUSSION: The comment is provided to aid in the development of the draft report.

ACTION REQUIRED: A letter of intent from the non-Federal sponsor will be transmitted with the final feasibility report.

14. REAL ESTATE. The AFB document contains little real estate information. CESPL has not identified any real estate issues for discussion at the AFB. Although listed as an Appendix in the Table of Contents, the documentation does not contain a Real Estate Plan (REP) or Appendix. A comprehensive REP should be prepared in accordance with Chapter 12 to ER 405-1-12 for the draft feasibility report. In preparing the REP, the CESPL must present the real estate requirements for both the NED Plan (because it will define the limit of Federal financial participation) and the LPP. Finally, when the REP is prepared, the district should revise Section 5.6 found on page 187 to more appropriately summarize the real estate requirements.

DISTRICT RESPONSE: A real estate plan will be prepared for the draft report. Since the NED Plan and the NER Plan both define limits of Federal financial participation, real estate requirements for these plans will be identified in the real estate plan, along with those of the LPP. Section 5.6 of the report will be revised to more appropriately summarize the real estate requirements.

DISCUSSION: The comment is provided to aid in the development of the draft report.

ACTION REQUIRED: A real estate plan that covers the NED Plan, NER Plan and the LPP will be developed and included with the draft report. The draft report will be revised to appropriately summarize the requirements that are established in the real estate plan.

15. DOCUMENTATION OF TECHNICAL AND LEGAL REVIEW. The AFB material does not include documentation of independent technical review and certification that technical and legal reviews of the report have been completed. Certification of technical and legal reviews and documentation of significant issues, possible impacts, and resolutions should be provided with the draft report per EC 1165-2-203.

DISTRICT RESPONSE: Documentation of the independent technical review will be submitted with the draft report. In accordance with the CESPD Quality Management Plan, the transmittal of the draft report will also include legal certification and technical certification by the Chief, Planning Division. The final report will include legal certification and technical certification by the District Commander.

DISCUSSION: The comment is provided to aid in the development of the draft report.

ACTION REQUIRED: Documentation of the independent technical review will be submitted with the draft report. The transmittal of the draft report will also include legal certification and technical certification by the Chief, Planning Division.

16. PROGRAM MANAGEMENT. The FY 00 PED j-sheet states that the recommended plan is a $30 million project. The district is reminded to update this information for the FY 01 budget submission when the recommended plan is finally determined.

DISTRICT RESPONSE: Information to support revised budget documents will be supplied to appropriate functional office.

DISCUSSION: The comment is provided to aid in the development of the draft report.

ACTION REQUIRED: Updated budgetary information will be provided when the tentatively recommended plan is finally determined.

17. EDITORIAL / REPORT INCONSISTENCIES. Generally, the document would benefit from a comprehensive in-house review for editorial content and consistency.

DISTRICT RESPONSE: The report will be reviewed for editorial content and consistency. Throughout the report, there are inconsistencies with respect to terminology, especially as it relates to ecosystem restoration. References to environmental enhancement and environmental restoration will be changed to the proper term, ecosystem restoration. The single-purpose ecosystem restoration plan that reasonably maximizes restoration outputs will be referred to as the NER Plan, as opposed to the NEQ Plan, NED ecosystem restoration plan and NED/EQ plan.

DISCUSSION: The comment is provided to aid in the development of the draft report.

ACTION REQUIRED: The report will be reviewed for editorial content and consistency. References to environmental enhancement and environmental restoration will be changed to the proper term, ecosystem restoration. The single-purpose ecosystem restoration plan that reasonably maximizes restoration outputs will be referred to as the NER Plan.

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