The recent passage of a continuing resolution by Congress to fund the Federal Government for the remainder of its fiscal year is an encouraging short term development. As the Company has noted before, inconsistencies in U.S. Army Corps of Engineers lettings usually arise during periods of budget uncertainty. The Company is hopeful the relative certainty provided by the recently approved budget will allow the Corps to efficiently let projects over the next six months. This development, along with Corps work already underway should slightly improve dredge utilization as 2013 progresses.
The Senate Committee of Environment and Public Works has also recently approved the Water Resources Development Act (WRDA) of 2013 (Senate Bill 601). The bill would authorize the development of a variety of different projects to improve the nation's harbors and rivers, including improved water access. It is important to recognize that while the WRDA of 2013, if signed into law, would authorize various projects, it would not fund them. Funding must be secured through the traditional appropriations process before any projects would be put out for bid. The most recent WRDA, the Water Resources Development Act of 2007, authorized the La Quinta Channel Extension, which the Company was awarded in September 2011 and is currently performing dredging work on this project. This vital piece of legislation must now be voted on by the entire Senate and passed to the House of Representatives.
The Company also continues to closely monitor developments related to the Hurricane Sandy relief Bill, which totaled over $50 billion. Specifically, the Corps received $742 million to perform additional operations and maintenance work related to the aftermath of Sandy. With projects already being identified for bidding, the Company will be monitoring the situation for both bid opportunities and the effect this bill has on industry equipment capacity.The first step of a two step process to determine the civil fines related to the Gulf oil spill of 2010 is now under way. The Company expects resolution to be reached by the end of 2013 with bid opportunities funded by the RESTORE Act potentially out for bid beginning in 2014.
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