Pursuant to congressional authorization, the U.S. Army Corps of Engineers (Corps) and the U.S. Bureau of Reclamation (Reclamation), the agencies with primary responsibility for federal water resources management, operate water projects for specified purposes. In the case of Corps dams and their related reservoirs, Congress generally has limited the use of such projects for municipal and industrial (M&I) water supply, but growing M&I demands have raised interest in-and concern about-changing current law and reservoir operations to give Corps facilities a greater role in M&I water storage. Reallocation of storage from a currently authorized purpose to M&I use would change the types of benefits produced by a facility and the stakeholders served, which has led to controversy over project operations at some federal projects. The Corps and Reclamation, therefore, may be authorized to operate federal water projects for M&I use under the project-specific authorization statutes. Alternatively, the generally applicable Water Supply Act of 1958 (WSA) authorizes the Corps and Reclamation to include water storage for municipal and industrial use as a project purpose for new and existing projects. The WSA requires congressional approval if adding water supply storage would seriously affect the original project purposes or involve a major operational change for the project. However, the WSA does not define the extent to which the change in water supply storage must affect existing purposes or what constitutes a major operational change. This ambiguity has become a particular issue when severe drought raises the competition for water supply, and is an especially contentious issue in eastern riparian states where all users are affected by any drought. Because of such water shortages in some riparian basins with Corps projects, the Corps' reallocation of water storage at its discretion has been of particular interest. This issue is at the center of ongoing litigation related to the Corps' activities in the Apalachicola-Chattahoochee-Flint River Basin (ACF). The scope of the Corps' authority under the WSA was the subject of a 2008 decision by the U.S. Court of Appeals for the D.C. Circuit (Southeastern Federal Power Customers v. Geren), as well as a 2011 decision by the U.S. Court of Appeals for the 11th Circuit (In re Tri-State Water Rights Litigation). The D.C. and 11th Circuits reached different results, and the U.S. Supreme Court declined a petition for its review of the issue in 2012. These cases each addressed a tri-state water dispute involving Lake Lanier, a Corps water project in the ACF basin, which includes parts of Alabama, Florida, and Georgia. Using the Corps' reallocations of water storage for M&I use at Lake Lanier as an example, this report analyzes the legal and policy issues associated with reallocation under the WSA. Specifically, it examines Corps authority under the WSA, including limitations on modifications that constitute major operational changes. The report details data and examples regarding the Corps' reallocations under the WSA. It also analyzes various legal challenges of water supply storage at Lake Lanier, including courts' identification of congressionally authorized purposes, and discusses results of the litigation and options for Congress. Although the WSA provides authority to Reclamation as well, the application of the WSA to Reclamation is beyond the scope of the report.

Drought is a natural hazard with potentially significant societal, economic, and environmental consequences. Public policy issues related to drought range from how to identify and measure drought to how best to prepare for, respond to, and mitigate drought impacts, and who should bear such costs. This report provides information relevant to drought policy discussions by describing the physical causes of drought, drought history in the United States, examples of regional drought conditions, and policy challenges related to drought. What is drought? Drought is commonly defined as a lack of precipitation over an extended period of time, usually a season or more, relative to some long-term average condition. While the technology and science to predict droughts have improved, regional predictions remain limited to a few months in advance. History suggests that severe and extended droughts are inevitable and part of natural climate cycles. What causes drought? The physical conditions causing drought in the United States are increasingly understood to be linked to sea surface temperatures (SSTs) in the tropical Pacific Ocean. Studies indicate that cooler-than-average SSTs have been connected to the severe western drought in the first decade of the 21st century, severe droughts of the late 19th century, and precolonial North American "megadroughts." The 2011 severe drought in Texas is thought to be linked to La Nina conditions in the Pacific Ocean. What is the future of drought in the United States? The prospect of extended droughts and more arid baseline conditions in parts of the United States could suggest new challenges to federal water projects, which were constructed largely on the basis of 20th century climate conditions. Some studies suggest that the American West may be transitioning to a more arid climate, possibly resulting from the buildup of greenhouse gases in the atmosphere, raising concerns that the region may become more prone to extreme drought it was in the 20th century. Some models of future climate conditions also predict greater fluctuations in wet and dry years. California's 2007-2009 drought exacerbated ongoing tensions among competing water uses. While drought is most common in California and the Southwest, drought also can exacerbate water tensions in other regions. For example, the 2007-2008 drought in the Southeast heightened a long-standing dispute in the Apalachicola-Chattahoochee-Flint River (ACF) basin. Both California and the ACF are again experiencing drought conditions, as are the Rio Grande and Upper Colorado River basins. What are some drought policy challenges? Although the impacts of drought can be significant nationally as well as regionally, comprehensive national drought policy does not exist. Developing such a policy would represent a significant challenge because of split federal and non-federal responsibilities, the existing patchwork of federal drought programs, and differences in regional conditions and risks. While a comprehensive national policy has not been enacted, Congress has considered and acted upon some of the recommendations issued by the National Drought Policy Commission in 2000. In coming years, Congress may review how federal agencies such as the U.S. Army Corps of Engineers and the Bureau of Reclamation respond to droughts. Congress may also assess other federal programs or choose to reassess the National Drought Policy Commission's recommendations.