Family Farm Alliance Memo: Bureau of Reclamation's "Managing for Excellence" Albuquerque Meeting

Bureau of Reclamation's "Managing for Excellence" Albuquerque Meeting

Memorandum - March 1, 2007

The Bureau of Reclamation (Reclamation) earlier this week in Albuquerque , New Mexico conducted a two-day workshop on its “Managing for Excellence” program. This was the fourth in a series of public meetings hosted by Reclamation since last summer. I participated in this meeting, as did several members of the Family Farm Alliance ( Alliance ). The following has been prepared to summarize key developments discussed at this meeting, and to outline future steps in this process.

“Managing for Excellence” is Reclamation’s response to Managing Construction and Infrastructure in the 21^st Century Bureau of Reclamation, a comprehensive report completed earlier this year by the National Research Council of the National Academy of Sciences. Executing the action plan is a primary initiative for Reclamation this year. This process provides an important opportunity for western water users to find further ways to improve transparency in Reclamation decision-making, provide improved accountability, and make the organization as efficient as possible. If our concerns are properly addressed in this process, the improvements generated will trickle down to every Western irrigator who receives Reclamation irrigation water.

Attendance at the Albuquerque meeting was the lowest of the four hosted by Reclamation, so far. Thirty five people attended, and over half were from the Bureau of Reclamation or the Department of the Interior. Assistant Interior Secretary Mark Limbaugh participated for the entire workshop, as did Deputy Commissioners of Reclamation Brenda Burman and Larry Todd. Four of the five Reclamation regional directors were also in attendance.

Several Family Farm Alliance members were active in the discussions with Reclamation, including Jim Broderick (SE Colorado Water Conservancy District), Joe Hall (Water Consult), Bill Plummer (Yuma Mesa Irrigation and Drainage District), Steve Hernandez, (Middle Rio Grande Conservancy District), Bob Stackhouse (Central Valley Project Water Association), and John Sullivan (Salt River Project). Representatives from Metropolitan Water District of Southern California, Santa Clara Valley Water District , Colorado River Energy Distributors Association, San Juan Water Commission, and Western States Water Council were also present.

The meeting focused on reimbursable vs. non-reimbursable costs, decision-making, engineering standards, contracting, right-sizing, and expedited policy development. Mark Limbaugh opened and closed the meeting session, and he disclosed some important developments. First, in part due to concerns he heard expressed at last week’s Family Farm Alliance conference in Las Vegas (where “Managing for Excellence” was the focus on two panel discussions), he announced that the first of many implementation plans associated with “Managing for Excellence” Action Team reports would be released in the next 30 days. This is another step – separate from the original “Managing for Excellence” timeline – intended to provide more detail and assurances that truly innovative, bold and clear actions would result from this process.

Mark Limbaugh noted that “the devil is in the details” and that the implementation plans were intended to clearly articulate some of those details. “Accountability”, “transparency”, and “efficiency” are all good works, said Limbaugh, but they will ring hollow if real progress is not being made in this process. The recent mid-term report released by Reclamation (available on the Reclamation website), notes that “Managing for Excellence” (from here on out referred to as “M4E”) has generated some excellent products, to date. However, what is missing is a sense of finality regarding how the numerous recommendations coming out of this process will actually be implemented.

Larry Todd discussed some leadership changes in M4E. Importantly, Pacific Northwest Regional Director Bill McDonald will take over for Mary Ann Bach as the point person on “right sizing” of Reclamation’s Technical Services Center and engineering capacity, and Larry will move over from his previous Human Resources leadership role to directly assist Director McDonald.

I flew back to Phoenix with John Sullivan and Bill Plummer, and on the cab ride to the airport, we agreed that this work session was the most meaningful and fruitful to date. I’ll try to briefly summarize the discussions that took place below, hopefully before you drop to your knees in fatigue. Here goes….

I urge you to take a look at Reclamation’s “M4E” Midterm Report, which you can access directly on Reclamation’s M4E website: http://www.usbr.gov/excellence. I know many of you are having a hard time explaining to your customers and neighbors why M4E is important. Well, page 2 of the midterm report provides some helpful selling points that you should pass on to the skeptics. Customers and stakeholders will begin to experience the following changes in their interactions with Reclamation, directly as a result of the 12-month M4E process to date:

· Bills with more consistent information about the financial status of Reclamation projects;

· More transparency in decisions due to easily identifiable Reclamation policies in the now readily-available Reclamation Manual;

· Improved project cost estimating through the implementation of new policies for independent oversight of project design and cost estimating;

· Increased customer involvement on decisions regarding necessary repairs at Reclamation dams;

· Stakeholder and customer consultation regarding ways to add value to major repairs;

· A new Web site with contracting and financial assistance guidance and examples.

From my perspective, these are all good things, and Reclamation should be commended for their focus and hard work to get to this point. However, the real test for whether bold, innovative and clear changes will become reality will happen when the implementation plans are released (see above).

According to Larry Todd, through January 5, 2007, Reclamation had completed approximately 50 percent of the action items identified in M4E one year ago. The following lists those action items completed that are now in the implementation phase, and which will continue as a part of Reclamation’s normal business.

The composition of the teams and decision documents for all completed action items are available on the Internet at www.usbr.gov/excellence/.

Obviously, Reclamation has made progress in recent months towards completing action items. Many reports and products will be generated during the “Managing for Excellence” project, and Reclamation is soliciting comments on these documents. When these products are ready for your review and comment, they will be placed on Reclamation’s website. You can send a comment by using the "Comments" link or send an email to: excellence@do.usbr.com. If you want to talk to a live person with a pressing concern, try Roseann Gonzales (303-445-2780) or Larry Todd (202-513-0508).

There will also be opportunities in the implementation process (see above) to address concerns and possibly change direction, if necessary.

Discussion focused on how the M4E process is filtering down to Reclamation area offices, and whether or not this effort is understood by water and power users “on the ground.”

Larry Todd mentioned that Reclamation is stepping up efforts to bring the M4E process and philosophy to all levels of Reclamation. He discussed the Reclamation Managers Conference held in Albuquerque a few weeks ago, where John Sullivan , George Caan and I were asked to talk to the assembled group (over 200 in attendance). Larry noted that this customer presentation “made a tremendous impact, and was very useful to our managers”.

Reclamation leadership has issued a directive to regional offices and area offices, encouraging them to go talk to their water and power users and local irrigation districts. Larry Todd also urged the water managers present in Albuquerque to contact their local Reclamation area offices and take advantage of the opportunities currently provided via M4E. There is a perception within Reclamation that water users at the local irrigation district level are not very engaged or even aware of the M4E process.

Pacific Northwest Regional Director Bill McDonald, Jamie MaCartney, and Perry Hensley provided presentations and stimulated discussion on the two questions that appeared to generate the most interest from the water community:

The Reclamation speakers first presented some of their initial findings, stressing that it was difficult to come up with applicable comparisons between the private sector and Reclamation for the type of work Reclamation does. This is due to the lack of “cookie cutter” projects and a fairly weak data set that does not answer all the questions. However, based on this initial data, it appears that Reclamation engineering “per hour” rates were comparable, or less than, their counterparts in the private sector.

The Reclamation team acknowledged that the hourly rate is a secondary consideration when it comes to cost control. More important is the amount of time it takes – coupled with the rate – that yields truly meaningful results.

The data presented by Jamie and Perry were based on senior engineer functions associated with Safety-of-Dam programs. Costs incurred by Reclamation engineers for several of these types of projects were compared to proposals submitted by private engineering firms to perform this work, and the final results showed that, in general, Reclamation engineers could do the work for a lower cost than their private sector counterparts.

Again, while the preliminary results suggest that Reclamation’s high-level engineers are providing excellent “bang for the buck”, the presenters acknowledged that there does not appear to be any hard study that indicates whether outsourcing or Reclamation engineering costs are lower. At the present time, “task to task” comparisons are limited, although more data is being developed. Reclamation is in the process of looking at outsourced NEPA work, which may provide better understanding of this topic. Also, Reclamation is preparing its own case study of the recent controversial Carter Lake outlet project ( COLORADO ), which may shed more light on how the TSC technical staff works with regional and area offices on design projects.

Customers in the audience urged Reclamation to include engineers and project managers from the private sector and other government agencies to avoid the potential future perception that Reclamation reached its conclusions with limited input from outside professional interests. The “right-sizing” discussion was teed up on Tuesday and continued with focused interest on Wednesday.

Bill McDonald, Jamie Macartney and Perry Hensley picked up Wednesday morning where they left off the previous afternoon. As new construction activity has diminished, and Reclamation has become more of a water and infrastructure management agency, the agency has made a number of efforts to adjust its engineering and design staff to reflect these changes. However, Reclamation and its customers believe further, comprehensive efforts are needed to ensure that Reclamation’s engineering and design services have the appropriate capabilities, location, and staff size.

This particular issue is incredibly complicated, and its ultimate resolution is intricately tied to a variety of factors, including outcomes from other M4E action teams. Bill McDonald emphasized that the right – sizing effort is not just focused on the Technical Service Center (which has received particular criticism from some Western water users), but on the technical / engineering staff at all levels of Reclamation (the TSC, as well as staff in regional, area and field offices). Mr. McDonald made it clear that “right-sizing” is not:

Instead, according to Mr. McDonald, the factors that will be addressed while Reclamation looks for the “right” size include projected workload; sustainable core capabilities; and how best to accomplish work beyond Reclamation’s core capabilities.

This particular presentation sparked a lot of questions from the audience. A key concern – previously expressed at the public meeting in Las Vegas last summer – raised the question of how much “outside” input Reclamation was considering as they tackled this issue. Reclamation officials responded that federal FACA[1] compliance is a concern when this type of process is considered. However, Reclamation appeared receptive to the idea that outside input would be injected into the process, possibly via peer review.

Reclamation and the customer representatives appeared to agree that, despite Reclamation’s changing role, construction expertise will still need to be retained. Although the era of big dam construction may be gone, repair / replacement of the aging massive water infrastructure in the West will provide Reclamation will a pivotal construction role in the future.

Efraim Escalante, Special Assistant for Policy, Administration and Budget walked through an illustrative powerpoint presentation on the issue of reimbursable vs. non-reimbursable Reclamation costs. As you know, the costs incurred by Reclamation to construct, operate, and maintain project facilities for the purpose of providing benefits to project beneficiaries are either reimbursable or non-reimbursable from those beneficiaries. Reimbursable costs are recovered from project beneficiaries via annual repayments, sales of water and power, or advanced funding. Non-reimbursable costs are not recovered under current law.

The key concern here is one of communications. Some Reclamation customers have expressed concerns about lack of recourse and transparency associated with the development of these costs. Historically, the customers just see the bill, which reflects the final Reclamation assessment. Efraim believes that M4E will provide a forum to better allow Reclamation managers to explain to their customers how these costs are developed.

Roseann Gonzales outlined results produced by her action team, which addresses how Reclamation makes decisions. As a result of this process, Reclamation will now:

Roseann confirmed that this process is intended to improve transparency of decision-making to those within Reclamation, as well as its customers. However, she admitted that this will not be an easy process.

Bruce Muller (Assistant Director, SSLE) outlined recommendations developed by his action team to improve the elements of good engineering, including design data gathering, design standards, design process and the close out process. His team developed several recommendations for each one of these areas, which can be perused on the Reclamation website noted above.

A customer representative’s suggestion to also set up specific standards for construction work was met with apparent approval by Reclamation.

Upper Colorado Regional Director Rick Gold walked through a fairly impressive final document prepared by his action team. This team was tasked with establishing and maintaining a central repository for examples and appropriate guidance regarding procurement contracting. Prior to this effort, the numerous policies and regulations regarding procurement were not located in a central location at Reclamation.

As a result of this team’s recommendations, the Commissioner of Reclamation has directed implementation of an internet page for acquisition and assistance related guidance and that the site be maintained the Acquisition and Assistance Management Division. The site is completed, and can be accessed at: www.usbr.gov/mso/aamd . Rick Gold led us though a “tour” of this site, and it appears to be a very useful, good tool. It is now a permanent resource, and was teed up by M4E.

Shannon Kerstiens provided an overview of the highest priority areas to expedite policy development in Reclamation:

Randy Chandler outlined policies and opportunities to outsource and transfer O & M duties to local entities. Both issues were presented well, with minimal customer response.

Alliance members and other water users at the meeting advocated for three key measures which we believe will improve Reclamation performance and its relationship with customers:

W e believe that many of the individual concerns raised in the M4E process could be resolved if Reclamation implements these measures.

The Albuquerque meetings provided a model for how constructive discourse can occur between Reclamation and its customers. Mark Limbaugh, as the meeting closed, noted that it was “one of the more intense and detailed, focused meetings we’ve had.”

Mark urged us of the need to get the word out about encouraging more water users to attend these meetings. There will be many to come, now that implementation plans are being developed, in the next ten months. At least one of these meetings will be held in Denver , and it appears that Portland is also being considered.

I STRONGLY encourage your attendance at these meetings. In my view, our concerns are being heard and acted upon. That may not necessarily be the case two years from now.

[1] In 1972, the Federal Advisory Committee Act (Public Law 92-463, 5 U.S.C., App) was enacted by Congress. Its purpose was to ensure that advice rendered to the executive branch by the various advisory committees, task forces, boards, and commissions formed over the years by Congress and the president, be both objective and accessible to the public. The Act not only formalized a process for establishing, operating, overseeing, and terminating these advisory bodies, but also created the Committee Management Secretariat (MCC), an organization whose task it is to monitor and report executive branch compliance with the Act.